Complex trading system #10 (Egudu simple 4 tools trading)
Submitted by User on December 17, 2007 - 13:50.
This Forex strategy was submitted by Egudu.
ok guys, here the strategy:
any currency
1hr,
7EMA(blue)
21EMA(red)
ADX(14)
MACD(12,26,9)
enter long once the 7EMA crosses 21EMA up and the ADX has passed it's 25 or 20mark and the MACD is trending up. The other way round is for short position. Note, only enter a position once the ADX has passed it's 25mark.
Exit: exit any position once the 7EMA crosses the 21EMA. Also, the MACD should be looked at before entering a trade, when it's consolidating, you should stay away from the trade.
Egudu,
Thank you from all our users and web team! Your contribution is greatly appreciated!
Edward Revy,
http://forex-strategies-revealed.com/
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Have tried trading with ADX trending up but got stopped out by false signals. I like this strategy very much and would like to refine it further. Would appreciate if others trading this strategy can advise on other indicators to look out for?
Ideally, ADX should be trending up, but ADX signals most of the time will lag.
Initial trading was very profitable but has been experiencing quite a few false signals recently. Noticed that after entry upon the EMA cross, the EMA uncross again resutling in losses and most of the time, ADX was in the 30s and trending down. Wondering if ADX has to be trending up all the time to signal strength of trending market?
Sorry, i mean the adx eliminate false signal. hehe.. happy trading!
Oh my God i love this strategy!
the Crossing MA's eliminate false signal on MACD, vice versa. Great Job!!
-wolf-
Indicator explained: MACD
may i know more about MACD please, thankxxx...
wrong
Hola cual de las tres lineas del ADX se toman para ver si esta por encima de 20 o 25??
Gracias
If you put the Stochastics on (6,3,3)...when it cross...it the best for exit signal :)
Congratz for your system
Hi David,
it matters, however, depending on what preceded to different ADX stages.
-> Weakening of ADX below 20 or flat ADX below 20 - stay aside.
-> Weakening of ADX (or flat ADX) above 20 but below 40 after ADX had risen from below 20 - disregard and keep trading, treat is as a temporary market retracement until further notice: it stalls in a sideways channel or breaks previous Support/Resistance level, signaling of a reversal.
-> Weakening of ADX after it descends from above 40 - the trend has already started to change.
-> ADX strengthens while below 20 - identify breakout lines/channels and wait for an opportunity to trade - a trend begins to form.
-> ADX strengthens above 20 - a trend is there to take advantage of.
-> ADX strengthens past 40 - a trend is peaking, keep on trading till ADX continues to rise.
-> ADX gains strength shortly after descending from 40, follow a signal from -DI +DI lines, but make sure to take trades only after S/R level is breached, in other words, make sure the market intends to trend again.
Best regards,
Edward
I'm new to this site and wanted to asked the following re this strategy. Re the ADX being above the 20/25 mark, does it matter whether it is strenthening or weaking or flat?
thanks
David
You've got the point here: by relying on exits with moving averages you're giving back some good portion of your profits, sometimes more, sometimes less... But, there is the other side of it: the reason you're able to hold to a trade for an extended period of time is because you used moving averages to follow the trend in the first place.
With MAs one should find the balance between profits and risks, and simply work on protecting the largest portion of gains while risking the rest for the privilege to stay in a trade for a longer period of time.
Regards,
Edward
The problem I have with EMA cross strategies is the exit. Exits that rely on EMA's crossing back always result in lost profits, usually a lot.
I have tried your system and it's really working only a little bit choppy on exiting... i used parabolic sars to have more confirmation. Keep up the good work guys, it really helping people, like me:)
eddy
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