Contango and Backwardation

Last Updated on 9 September 2022 by

Contango or Backwardation may be a trigger-condition to develop a trading strategy.
I developed the strategy in pinescript in Tradingview, but found out only one opportunity, using 30 minutes-Natural Gas chart and golden/death cross applied to contango’s curve (chart: NG2! – NG1!).
I’m not happy as a good strategy should be applicable on more timeframes and other row materials (no good result backtesting Gold, USOil, Silver, Soy, wtf…).
But it’s ok, only hard work will lead good money, and I like this.
Anyway, this strategy in running on my demo account, setting up a webhook alert notification in Tradingview towards my python-custom webserver running on my VPS (using amazon web services cloud)

Backtesting result. Going long 30-minutes NGAS chart after death cross occurring from contango’s chart (NG2! – NG1!). Death Cross is when SMA-50 crossing down SMA-200. This strategy beats the “buy and hold” strategy. Drawdown, percent profitable, profit factor, are acceptable.

Giancarlo Pagliaroli

Disclaimer: The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types od advice or recommendations supplied or endorsed by me.

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