Coyotte.
A few things.
Firstly lagging indicators (in my view) are fine for positioning a stock/index/commodity in a pre trade condition. For trade execution I use price itself combined with pre trade conditions being met.
Entry is the least important part of a trade the longer term the trading method is.
It becomes more important as the timeframe shortens. Very short term methods can and are based purely on NOW price action.Swingtrading/Support resistance methods,Elliot,Steidlmayer etc.
True all methods will run into conditions not found in the sample of testing,a situation that ALL traders will have to deal with at the time it occurs,wether trading a system or in a discretionary manner.
If you can get your head around the following it may help.
"Systems are based around a vast number of singular trade events the positive and negative results of individual trades have very little effect on the short term success of the system or method. So in themselves they are only a snap shot of an overall event---the event being the positive performance of the trading system or method.
During the course of trading the system the overall performance will move from over performance at times to underperformance at other times. However whilst the method which is a singular trading event in itself---overtime it will win or lose---just as any singular event within it--
Each trade within a method OR system has a criteria which governs Entry/Stop/Exit/Moneymanagement rules,their success or failure is governed by their performance relative to those rules.
So to is a System as a singular event.
It has a Blueprint and like an individual trade event if the systems or method falls outside the blueprint it can be seen as failure---and yes it can occur.
However that failure can still mean that the performance of the method was well over the performance of random selection or say an Index benchmark.
Its failure in a situation (which once found can be included in refining of the method) can be alerted well before ruin--purely because the parameters in the Blueprint are clearly known."
As an example.
Maximum Peak To Valley drawdown of a method maybe 20%,is a system or method found itself trading at a 23% P/V drawdown all system trades would be terminated with a realised loss from peak open equity of 23%.
Still profit and far from ruin.
Same for initial drawdown.
If you start a method with a maximum say 12% initial drwadown then find it at 14% your out! 14% loss of capital but not ruin.
I follow 4 systems all have performd within their trading Blueprint over the last 4 yrs and if and when they all fail due to outlier conditions not seen in testing all will still be very profitable.
"is this market the place to be right now?".
This question is answered when a system or method falls outside its blueprint.
Once breached then the answer is NO.---relative to the particular trading system method your trading.
Until an event can be found that has a negative effect outside those which were included in any test period it cannot be forseen and or included in the design. Once it has then it can be included.