Using The DAX As "BUY" Confirmation for SPX 500

Good Morning,

I was in the chat this morning when a fellow member of TV (MartyMcFly) brought up an interesting point about the DAX. the DAX and S&P 500 are highly correlated.

SPX500 vs DAX



At the end of the previous month, a BUY signal was generated on SPX 500 ( closed above its 10 month MA ) , but we didn't get the same signal on GER 30 ( DAX)

SPX 500



DAX



DAX ( D vs 200MA)



What would be the results if we used the DAX as an additional confirmation before buying the SPY ? As you can see on the equity curve the below , the result are pretty good. Although the profit factor is lower than simply buying the SPY when > 10 moth MA , the drawdown is lower.

the 'SPY > 10 ma " system is still very reliable , but adding the DAX as an additional confirmation , may be helpful as well.

cheers

Algo