Forex trading strategy #1 (Simple balanced system)
Submitted by Edward Revy on February 28, 2007 - 14:49.
Current Forex trading system represents a well thought and very simple combination of indicators. Knowing what signal to look for with each indicator, provides a strong tip for good entries and exits.
Time frame: Any.
Currency: Any.
Indicators: 5 EMA, 10 EMA, Stochastic (14, 3, 3), RSI (14, 70, 30)
Entry rules: Buy when 5 EMA crosses above 10 EMA and Stochastic lines are heading north (up) and Stochastic is not in overbought position (above 80.00 level) and RSI is above 50.
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Hi Norma,
The rules of the strategy suggest to: "Exit when 5 EMA and 10 EMA cross in the opposite direction or if RSI crosses the 50 mark again."
If I understood you correctly, you just wanted to figure out how the stop loss order is placed in general. If so, lets take an example:
EUR/USD is now trading at 1.4687. We have chosen to use a 20 pip stop loss for every trade.
If we go Long at 1.4687, our stop loss order will be set at 1.4667.
If we go Short at 1.4687, our stop loss order will be set at 1.4707.
(excluding spreads for the simplicity of the example).
Regards,
Edward
HI Edward,
This strategy seems to work pretty good, but when we enter or exit do we have to wait for the current candle to close, so that the change in the trend is confirmed or we just enter or exit whenever we get all three signals in our favour.
I use EURO.USD 15 min.
Thnx
Robin
That's correct, Robin, we wait for the current candle to close before we decide on a trade.
I'm glad you're successfully applying this strategy.
Regards,
Edward
Hi Edward,
Does it matter whether you use Stochastic slow or Stochastic fast indicator?
Hi,
Mathematically, slow and fast Stochastic are nearly the same (with a little alterations in K% value).
The difference is in sensitivity: Fast stochastic is more sensitive to price changes than Slow stochastic. With Fast stochastic you will get more signals and they'll arrive quicker, than with Slow Stochastic. But sometimes more signals doesn't equal quality.
Regards,
Edward
hi
my name is sami
i don't find EMA indicator in my platform fx sol meta trader
can you help me to find it
thank you
Loom at menu links above and click:
Insert, Indicators, Trend, Moving average. In window settings choose MA type - Exponential.
the other way is to hover over the top pictograms on your screen until you find one called "Navigator". Make sure it is on. The window will appear on your left side. You'll see there all indicators as well as "Moving average". Drug and drop this indicator on your charts.
hope this helps.
Hi All,
I cannot decide to take profit before the 5 ema crosses 10 ema, or should one wait until the crossover? I notice a significant portion of profit is given back to the market waiting for the crossover exit signal.
All opinions welcome.
Mike
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