Thanks to a conversation with a friend over the weekend. I’ve generated a monthly forecast that influences the usage of leverage in my trading going forward. For example, if the daily and weekly forecast are negative and the annual forecast is also negative, but the monthly forecast is actually positive; arguably, I shouldn’t be investing with leverage based on longer-term forecasts in that circumstance as the monthly and annual forecasts contradict each other. Essentially, the monthly model is a “not yet” tool, providing some indication of whether the annual forecast is imminent or not. If it’s not imminent, leverage in my trading positions isn’t justified.
