Forex trading strategy #2 (Slow moving averages crossover)

Hi Edward

I am currently using FXCM platform, i am not able to find the indicator SMA, but they have WMA, can this be use instead? also, is there any difference which I have to take note?
Thanks

Edwin

Hi Edwin,

unfortunately, I'm not good at MT4 programming to be able to help here.
There are some freeware that could help you write simple EAs, just follow this link:
http://forums.forex-strategies-revealed.com/how-start-writing-trading-sy...

Regards,
Edward

Hi Edward
Can you advise how can we programmed this strategy to make it automated?

Thanks

Edwin

Nice strategy seems like parabolic SAR 0.2,0.1 works well to avoid choppy markets. Only retrospective analysis.

Right click on the moving average and go to Properties.
You'll find MA method there.

Thomas

hi what is that ?

You can do it by calling the settings window for your Moving average, and there changing MA Method parameter to Simple.

Cheers,
Thomas

Where to get SMA in mt4 platform
Thanks..

Hi Nitya,

try Heiken-ashi candles for trailing stops.
Reference:
http://forex-indicators.net/trend-indicators/heiken-ashi-candlesticks

Another way to do it would be with CCI, which will help you to not give very little profits back, please take a look at the method here:
http://forex-strategies-revealed.com/money-management-systems/cci-exit

Best regards,
Edward

Hi Edward,

Great website you got here.
I experimented with this strategy. However, i have a few comments and questions.

Firstly, I used 3 EMAs i.e. 10,20, and 50. I use it on a H1 and H4 time frame.
First signal is the 10EMA and Price cross over (I use the Line chart as it is less clustered and signals a clear close), followed by the 10EMA and 20EMA cross over for trend reversal confirmation (Also confirmed by fib retracements at 23.6). I also keep and eye on the MACD and PSARs (0.05,0.1. Once entered the market, I use 50EMA price cross overs to add on a position.

However, my biggest concerns are the exit strategy. EMA cross over exit strategy does not optimize trade positions. I noticed that EMA cross over exit strategy would only give approximately 45%-55% of the trend. Please advice on an good exit strategy that would be between 55%-70% of the trend.

Another question - I noticed the alignment of the EMAs makes a difference on how the market reacts to retracements and reversals. That is to say, when 10EMA cross 20 EMA from above and 20EMA crosses 50EMA from above aswell, it is a much stronger signal as opposed to when a 10EMA crosses 20EMA from above but 20EMA does not cross over at the same time. And can a 100EMA be used to gauge the take profits (support or resistance)

Please share your thoughts.
Thank you very much. Appreciate your efforts on this website.

Nitya

I have no such skills, unfortunately. Other traders might be able to help.
I'd recommend asking a trading community at http://www.forex-tsd.com/
They have lots of members who can code almost any EA.

Best regards,
Edward

can you send this strategy in mq4 format

Hi Samuel,

EMAs are constantly changing. After crossing, they can still "uncross" within the next few candles, but only if the price has changed direction and this change is significant. In all other cases, we'll have a valid cross.
The best we can do is to wait till a current candle is closed to ensure that EMA stopped moving and a crossover signal is still there.

Regards,
Edward

how do i know the indicator has stopped changing? i mean where in the chart do i look to determine this?

thanks

samuel

Stop loss is a must for any strategy.

The middle band of Bollinger bands indicator is a simple Moving average.
For BB (20, 2) we have 20 SMA as a middle band.
If to trade the retracement, you can easily switch to 20 SMA. Like any retracement, it won't happen every time you expect it.

Regards,
Edward