Fewer whipsaws

QQQ 3,161

Signals from QQQ’s 3×161-day SMAs, trades in TQQQ — the combination found by the optimization series.

How it works

A community optimization series swept moving-average combinations exhaustively and found that taking signals from QQQ with 3/161 beats TQQQ-based signals by roughly 2%p per year with far fewer trades. When the 3-day SMA crosses above the 161-day, buy TQQQ; when it crosses below, exit fully into the rotation asset.

44.9%

10y CAGR (sim)

-48.1%

Max drawdown (sim)

Signal & traded assets

Signal (chart)	QQQ · 3-day × 161-day SMA
Traded asset	TQQQ (3x Nasdaq)
Parked after sell	SGOV (short-term treasuries)

Rules

Signal	QQQ 3-day vs 161-day SMA (traded asset: TQQQ)
Buy	3-day crosses above 161-day → buy TQQQ
Sell	3-day crosses below 161-day → sell all TQQQ
Basis	Optimization part 5: QQQ 3/161 optimal; beats lump-sum on both return and MDD

Charts on real data

Last 5 years · green shading = holding periods

Last 10 years · growth of $1 (no taxes/fees)

FAQ

Why signal on QQQ?: QQQ is less noisy than TQQQ, so even a short 3-day SMA whipsaws less. It separates signal stability from leveraged returns.
Is 161 a magic number?: It came from an exhaustive sweep. The series also showed n2 = 210–230 works — think of it as a band, not a magic constant.
Should I enable confirmation days?: In choppy sideways markets, 1–3 confirmation days filter fake signals — at the cost of later entries/exits. Use the app's signal-confirmation option (0/2/3 days).
Any downside vs the original 200-day?: Signals come from the index (QQQ), so TQQQ-specific issues like volatility decay are reflected half a beat late. Across the full backtest, fewer trades and better returns outweighed this.

Sources

• Optimization part 5
• Part 1 — exhaustive sweep
• Part 2 — with fees

Backtest charts on this page reproduce the app’s rules on Yahoo Finance daily data (last 10 years, adjusted closes) for reference only. Taxes, fees and slippage are not modeled, and past performance does not guarantee future results. Rule descriptions and live signals always follow the app’s latest implementation. Nothing here is investment advice; decisions and responsibility remain yours.

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