Forex trading strategy #1 (Simple balanced system)

Hi Tim,

By default absolutely all indicators for all strategies use values applied to Close. If some other settings are being used, it is always mentioned in the strategy.

By default all trading platforms use indicators with values applied to Close. In Metatrader4 we have an option to also use Open, High and Low, but this is just an option :)

The difference is straight-forward - when a price bar is closed we have most adequate and most recent market values comparing to High, Low etc. It is a common default rule - all indicator values are normally applied to Close.

Regards,
Edward

Hi Edward,
Just curious about the EMA settings. I have Open, Close, High & low settings available. What is the optimal setting for this strategy? Also if you could briefly explain the differences I'd be eternally greatful.
Thanks,
Tim

Thank you for your feedback and a useful summary, MGirl

Happy trading!

Edward

Hi Edward,
Thanks for replying.Yeah, u r right about this strategy.
it really works as it is,it really doesnt need 100 EMA or any other trend confirmation as the trade signals come pretty "filtered''already with crossover,stocs n rsi.
For exits,however,I prefer to use traling stops than waiting for ema crossovers in opposite direction.i have noticed that they kill half of yr profits if u wait that long. i watch stocs closely throughout the trade, i think stocs give pretty early signals of exits.
I am using it on 30 min chart and it has nt let me down yet.
this is truly a KISS method.
thanks for sharing it
Cheers!
MGirl

Hi Miraclegirl,

This strategy already got lots of "ifs", so I decided to keep it simple, besides it works well as is.

However, I always encourage traders to run own tests and improve trading rules. We all have good ideas, sometimes brilliant ideas which we shouldn't be afraid to use.

Best regards,
Edward

All messages wait to be reviewed before being published. Thank you.

Thomas

where has my messag gone?

hi Edward,
tks for a great site.
This strategy has been quite good 4me on demo.But i wonder if i am getting too conservative when I added my version- only long when price action is above 100EMA n only short when below 100Ema.
i see that u normally advise trading with the main trend but 4 this strategy u dont suggest that rule.why exception to this rule for this stragety?
i am testing it more n surely will post my results.
tks again.
miraclegirl

Good results, well done.
I appreciate your feedback on this strategy!

Thank you and happy trading!

Edward

To add to this all the positions were long as I limited the opening. From what I could see using the opposite signal to close the position wasn't the best solution, I just let it close on a trailing stop. I want to test various exit strats with this.

I coded a strategy based on this approach and run it through dukascopy's backtester - nice results. I trail a stop on this but it's a quite a way back and really just a safety harness as the opposite position will trigger the close.

I also added bollinger bands to the mix for a breakout signal and making sure the gap is above 2.5 makes a good test. Added another couple of bit's and pieces but essentially staying with the main strategy.

Based on 280 trades - got one looser which was over the Chinese new year. That was going from the beginning of the 2009 to now... I also based my signals on 1minute bars on the close.

Hi Niyi,
Taking half of the position using a trailing stop would be the right thing to do.
Letting the other half run until exit rules are met.

Regards,
Edward

Hi Edward or anyone,

what can be a good money management for this strategy?

thanks.

'Niyi

Hi all,

When all conditions are met (EMA cross, RSI and Stoch are in position), we enter with a marker order (instant order) right after the close of a candle that caused/created a valid setup/signal.

This is not the best system to use for scalping.
Its range is 5 minutes charts and above. But, on 5 min charts you can do some quick trading by taking small gains of 5-10 pips at the time.

With 100 SMA you'll be able to see major trends + when price trades close to 100 SMA (25-30 pips away from SMA line), you'll know that there might be some choppy sideways price shifts ahead; this is the time you may want to keep away from trading for a while.

Regards,
Edward

I like this strategy a lot i just cant work out how to determine the fast buy/sell entries.

any suggestions?

Kenneth