Category: Trading Systems - Page 6

Forex Trading System Gurusomu

The polyvalent trading system “Gurusomu” is based on the famous Japanese indicator “Ichimoku“. This trading strategy can be used both for small timeframes (up to 30 minutes) for scalping and short-term trades, as well as for medium-term and long-term trades using 1 hour price charts and higher time frames. With this system we can trade with any currency pair and at any time. Naturally, if you want to do scalping, you will have to choose the time period where there is greater market volatility, and a Forex broker for scalping.

To trade safely in the Forex market, choose one of the best Forex brokers that are regulated. If you have doubts which to choose, you can always make a comparison between them.

The scientific method in the development of trading systems

by rcanessa

Tell me one thing: how do you validate your trading system? How can you be sure that by following these entry and exit signals from the market you will have profitable results? Just because you have executed a backtest and it has given you good results?

In today’s article I propose to rethink your way of working and begin to apply the scientific method as a procedure of development and validation of trading systems.

What is a Trading System?

by rcanessa

What is a system?

A trading system is a set of rules that unequivocally define the way to trade one or several financial instruments in order to obtain benefits. Experts say that a trading system only exists if it is written, so that there should not be any ambiguity in the investment methodology that is intended to be applied. The rules must be coherent with each other and can not be contradicted.

Karl Dittman indicators for Metatrader

by rcanessa

In this article, we present five new indicators for Metatrader 4 designed by a famous and expert trader in the Forex market named Karl Dittman. These indicators are available to any trader and can be used at their discretion. For each indicator we include a brief explanation and image showing how they look. At the end of this article, we include a link through which these indicators can be downloaded.

The indicators are:

BrainTrend
Gmacd
ATR Levels
Breakout indicator
Trendlines indicator

Vegas Trading Strategy With Moving Averages Tunnels

by rcanessa

A type of trading strategy that has been used for some years to trade successfully in the Forex market and with other financial instruments is based on moving averages tunnels such as the Vegas systems. In summary, these are discretionary systems for swing trading which are based on moving averages envelopes. To better understand how works this type of strategy we will explain in detail a system known as Vegas Wealth Builder.

The author of this strategy has defined the following steps for implementation:

Pure Trading System

by rcanessa

This trading system seems to be relatively profitable because it quickly stops the losing trades and let the winners trades run, ie the ideal of all profitable trading systems. As with any strategy is very important to have discipline and follow the rules to the letter, not “hunches” or anything similar.

The first thing we will do is set the graphic settings as follows:

1 Japanese candlestick chart.
1 Moving Average SMA of 50 periods in the High.
1 Moving Average SMA of 50 periods in the Low.
Fibonacci extension pulls.

By using a SMA 50 in the High and a SMA 50 in the Low we form a channel which use is described below:

Simple Forex Daytrading System

by rcanessa

The following is a simple trading system that uses only two indicators and has given good results. It can be used in any market, including Forex, precious metals and others. Of course, we recommend that before using this trading system to trade with real money, it must be evaluated on a demo account. You can check our list of Forex brokers to find one that satisfies your trading needs.

This trading strategy uses the following indicators:

Bar/candles daily chart.
SMA (Simple Moving Average) of 13 periods.
10-period RSI (Relative Strength Index), with a line at level 50.
Read more

Trading System with RSI and CCI

by rcanessa

This is a simple trading technique based on the use of the indicators RSI (oscillator) and CCI (trend indicator). The author claims it is a pretty efficient system, however, I recommend to evaluate it on a demo account before risking real money. The strategy was explained in a forum on the Forex market and its author has indicated that sometimes he obtains more than 400 pips in two days with this system.

To implement the system the trader requires a candle or bar chart with a time frame of 5 minutes (the trader can use longer time frames but can be more risky). The indicators used are the RSI at 14 (it can also be used with 8 periods too) with additional levels at 45 and 50 and the CCI with 14 periods. The recommended currency pairs are:

EUR/USD.
USD/CHF.
EUR/JPY.
GBP/USD.

Because it works based on oscillators and in a short time frame, the system produces false signals, which can be filtered using an indicator like the ADX at 14 for example. The MACD can also be used with a configuration of (3, 81, 29) and (3, 10, 16). Another indicator that can be used is a moving average to verify the direction of the trend. Remember that in markets with a strong tendency the oscillators produce even more false signals so it is best to trade in favor of the trend. For that an EMA can help us.

How to move the stop loss in a trading operation?

by rcanessa

We have already discussed in previous articles how important the stop loss is. For those who are not yet clear on the subject, the stop loss will be that price level from which our trade would cease to be valid and should be closed.

The stop loss can be automatic and programmed in the broker itself or manual. In the manual stop loss the trader makes the final closing of the transaction after checking the price in the market.

Knowing how to define the stop loss is very important. Depending on the distance of the stop loss from the price, we will have more or less profitability in the trade, provided that we respect an efficient money management.

The stop loss, once defined, may have a double evolution.

On the one hand we can have a fixed stop loss that does not evolve with the price. This type of stop loss is normally used on transactions with a high Risk/Profit ratio, so we are going to look for a price target that is much farther from the stop loss level.

What is a Market Neutral strategy?

by rcanessa

Market neutral strategies, as the name implies, are investment strategies that show neutrality to market trends.

What does that mean?

It means that the profitability of the strategy is not related to the performance of the market in which it operates.

It is a non-directional strategy. With this type of strategy we do not seek to guess where the market will move. Regardless of whether the market rises or falls, a market neutral strategy will look for constant and little volatile results.

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