Advanced technique #9 (System Selection Technique)
Submitted by Edward Revy on September 18, 2008 - 10:21.
Choosing the right strategy for trading is a strategy by itself. (from Edward)
All credits and special thanks to Arsalan, the author of this technique.
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Hello everyone and thank you Mr.Edward Revy for publishing my ADX+EMA SYSTEM.
I want to share one very good idea with everyone.
This is not a trading strategy but a technique to determine which system to use and when. There are many systems available to use some are trend following systems like moving average crossover and some are oscillator based system which utilize indicators such as Stochastic, Rsi and William %R but if all these systems are good then why they work sometimes and sometimes they fail?
The reason is selection of a good system at wrong time.
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Thanks Edward. Great site you have here!
That exact MACD is available on FXTrade with Oanda broker.
For MT4, you can download this one: MACD_2_Colour_HISTOGRAM.mq4
Regards,
Edward
Superb idea, by the way where can i get that MACD like yours Andrew?
Thank you friends for your beautiful comments.
Happy Trading,
Arsalan.
I agree, this is really an awesome summary of the way these indicators work, I've been trading for six years and I have never seen it so neatly summarized before-truly is the closet thing you can get to a holy grail. Thank you so much, this has really helped my trading incredibly!
Good grief I never thought about this before! Thank you so much for sharing! I have been backtesting it and it's like my eye's have been opened as to what is really going on for the first time in 5 years of trading!!! I'm mad at myself for not figuring this out before. I know I'm not supposed to say this but this is like the Holy Grail - at least for me. I found that for intra-day trading, look at ADX on the hourly - see what it's doing there - then go to the 15 and 30 minute charts to apply the rules from here and you will find it's pretty hard to find a losing trade. Thanks again!
this single piece of advise seems to be the one thing that make everything works as expected. Is like the glue between all the indicators and oscillators that exist! thank you very much
Raul
good one, wish you all the successes
imran khan
On MT4 Full Stochastic = Slow Stochastic.
Thomas
Where to find full stochastic in MT4 pls help..
hye Arsalan,
can u explain about this, its a bit confusing because there are more than 3 levels of ADX
1)ADX is below 20 - USE OSCILLATOR BASED SYSTEM(RSI,STOCHASTIC ETC.)
2)ADX is above 30 - USE TREND FOLLOWING SYSTEM(MOVING AVERAGE,MACD ETC.)
3)ADX is at 45 or above it - BOOK PROFITS.(Wait for new entry)
4)ADX IS RISING FROM LEVEL BELOW 18 AND THEN GOING ABOVE 23 - USE TREND FOLLOWING SYSTEM.
5)ADX DECLINING FROM LEVEL ABOVE 30 AND THEN GOING BELOW 27 - USE OSCILLATOR BASED SYSTEM.
thank you.
Hi friends,
I have never used this method in intra day trading so i cannot say for sure that this system will work for intra day trading.I mostly use opening range breakout strategy for intra day trading so i never even tried to test it.I will soon post a method to select trading systems for intra day trading.
Regards,
Arsalan.
Dear Arsalan,
can this system determine what strategy to be used if im a intraday trader?any suggestion?
hey Arsalan,
im a bit confused about ur explanation regarding the ;
4)ADX IS RISING FROM LEVEL BELOW 18 AND THEN GOING ABOVE 23 - USE TREND FOLLOWING SYSTEM.
5)ADX DECLINING FROM LEVEL ABOVE 30 AND THEN GOING BELOW 27 - USE OSCILLATOR BASED SYSTEM.
what do mean exactly?does this system only use 3 levels (20,30,45)?
Thanks friends for your beautiful comments.
Arsalan.
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