Vegas Dual Tunnel System

Vegas tunnel trading originated from a well-known fund manager who published his Vegas tunnel trading methods on the Internet. It can be said that this method puts forward a very remarkable and excellent trading concept which concludes the definition and breakthrough of tunnels, as well as an application to the extreme of the golden ratio. Vegas used this method to back-test nearly two decades of historical data on about 100 products. The tunnel trading system provided by Vegas is the crystallization of his research and forward trading for more than 20 years. This method also shows a profitable track record in many trading varieties.

In order to identify the trend, we added a second tunnel to the traditional Vegas tunnel. These two tunnels can give us very good guidance on prices and trend directions.

Indicator parameter as below

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How to use it to identify trends?

Other than providing a support and resistance to market trends, the most essential application of vegas double tunnel system is that it can identify changes in trend.

Firstly, we identify the black tunnel as tunnel 1, and the blue tunnel as tunnel 2. The fluctuation of tunnel 1 is relatively faster, and the parameters of tunnel 2 are twice that of tunnel 1, so the fluctuation will be slower.

When tunnel 1 is above tunnel 2, and the tunnels are all moving upwards, this is a very intuitive upward trend. Therefore, we will trade longs in the upward trend of the market. Conversely, if tunnel 1 is below tunnel 2 and is moving in a downward sloping direction, we can judge in this system that the trend is falling. It is easy to identify trends when double tunnels is moving in a clear upward or downward trends. But how do we know if the market is in a consolidation stage? That is, when the two tunnels are entangled with each other, and the slope of the tunnel is almost horizontal, such a trend is often in a ranging market.

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