Google Trends: Individual Stock Keyword Rank system

This system uses Google Trends for buy/sell signals. For background and theory, see original magazine article: Google Trend Sentiment Systems.

System rules

1. Buy at stop next bar at the 5-week highest high price if Google Trends filter is bullish (trend entry).

2. Buy at market next bar if the Low price has been declining for 6 weekly bars in a row or more if Google Trends filter is bearish (counter-trend entry).

3. Sell trend position at stop next bar at the 5-week lowest low price if Google Trends filter is bullish.

4. Sell counter-trend position at market next nar if the High price has been rising for 3 weekly bars in a row or more and Google Trends filter is bearish.

Google Trend filter composition rules

The Google Trends rank is determined based on a company’s search rank represented by either the stock ticker itself or the company name, if the ticker is ambiguous (“cat”) or rare (and consequently, missing in Google Trends output). Below is the disctionary of ticker/keyword pairs our system was configured with: "AAPL" = "Apple", "BA" = "Boeing", "C" = "Citigroup", "CAT" = "Caterpillar", "CSCO" = "Cisco", "DIS" = "Disney", "FITB" = "FITB", "HPQ" = "Hewlett Packard", "IBM" = "IBM", "INTC" = "Intel", "IP" = "International Paper", "JPM" = "JPM", "KO" = "Coca Cola", "MSFT" = "Microsoft", "SBUX" = "Starbucks", "T" = "AT&T", "WMT" = "Walmart". It is considered valid when its value is greater than 0.

• Index is bullish: composite Google Trend rank value for the current week is above 1.0 (indicating rising interest to a keyword) and the GT rank is above its own 5-week simple moving average.

• Index is bearish: composite Google Trend rank value for the current week is below 1.0 (indicating declining interest to a keyword) and the GT rank is below its own 5-week simple moving average.