Simple 5 / 8 moving average crossover

Dear PeterM,

Thanks for providing the idea.
I am applying your ideas to the following pairs:
eurusd,usdjpy,usdchf,usdcad,us30,gb pusd,audusd,nzdusd

manually stop loss and take profit,
if there is good news, I will post it on board.

Thanks a lot.

Trading log:
2011/10/13 usdjpy buy@77.118

Hello

I am quite new to trading forex and I have just found this thread. I have, up to now read the first eleven pages and think that this is the type of system I will like. Referring to PeterM saying that he trades the day charts, when is the start of the day? I live in England so would it be 8am when London opens?

Thanks, peterM, for sharing this.

Just came across this method of yours now. I have been using 5 SIMPLE MA and 8 EMA. But your 5EMA/8EMA seems to be a bit "smoother." Testing this out as I type.

Btw, I was wondering, is there a way to close a MANUALLY open trade using this EA by FireDave here - http://www.forexfactory.com/showthread.php?t=233301?

Dear All,

I have applied a FXCM demo account for testing.
The rule is Linear-MA(5,8) Cross without taking profit or stopping loss,
the following hyperlink is myfxboox trading log:

http://www.myfxbook.com/members/gftc...58-demo/180273
Thanks a lot.

This is the best instructions on how to draw a trend line I have ever come across. Fantastic. Thank you. A few years too late but thank you.

Charmane,

From what i read so far, you are using this on DAILY and/or H4 timeframe?

Is this your latest template?

Thanks for the share. And I hope not to much to ask, are you still trading this 5/8 cross?

Your new day is determined by your broker. It doesn't matter where you live. It's the time zone your broker uses. For example, I live in Japan, which only has one time zone, but my broker, Forex.com Japan, uses USA Eastern Standard Time for its scheduling. My trading week begins on Monday at 6 a.m. and ends on Saturday morning at 6 a.m. Right now it's 2:10 a.m. Saturday morning. (The Euro has 3 hours and 50 minutes to poop or get off the pot .) If you hold a position over into the next new day you will either be credited or charged a "swap"/rollover fee which is determined acccording to the interest rate of the central bank of the primary currency that you hold a position on plus the size of your position. Generally speaking, if you're buying the major currency pairs (those paired with the $US), you'll recieve the swap fee, and if you're selling you'll pay it. The USDCAD is the opposite - selling, you get, buying you give. The Japanese yen is the best payout for the carryover becauuse the official interest rate of the Japanese Central Bank is so low, (if you're Long) but right now the Yen (INMHO) is a dog. Some traders, who mainly trade multiple standard lots and hold postions long term (weeks or months), make a decent business out of collecting the carryover fees. Even if you're position is in the red, you can collect the difference in the interest rate between the two currencies.

bobby2 Thanks for that

Does any one have force/snakewithborders indicators? I am new in this forum and in Forex too.... with 8/5 system i want to use... pls suggest for scalping

seems very good and it seems simple.. i will try this strategy next days..
thanks for sharing

S

Hi everybody
I was a follower of this thread, 3 or 4 years back and actually did some contributing to it also at the time, since then I have tried many many strats, used many many indicators and looked for simplicity itself in which to try and trade as successfully as is possible. I have blown up numerous accounts, lost a kings ransom, and the only reason why i am still here is because I am a stubborn bastard, and stubborn bastards dont like grey areas we like simple yes simple black and white, I am also a crime writer so I leave complicated plots to that and need a simple escape, (note the word simple again), Now human nature is a funny thing, some people believe that a system, a formula needs to have alot of indicators, be challenging, difficult, have some kind of magic rule only known to a few, passed down for centuries, a handful of lucky in the know funny handshake individuals able to break the code, to be one of the 5% who know how to make a living, earn some money, pay the bills and have a few quid left over for a few beers forex gurus. Might be true if you believe what you are told, advised, kept in the dark, What amazes me is that there are literally thousands upon thousands of retail traders, trading every day in every country on the planet and seemingly nobody can find a winning formula. Some people have been trading for years unsuccessfully, 5-7-10 years without success, it dosent take that long to become a brain surgeon so why should it take that long to determine the direction of a candlestick. I can only put it down to one thing.....YOU.
So lets break it down, go back to the drawing board, please dont slate me if I missed something, this is just my ranting ideas and my take on things:
1st/ Simplicity, Open a blank screen on Euro/Usd (could be any pair)
2nd/ I don't want to scalp, havn't the patience as you have probably gathered so lets make it a daily chart.
3rd/ Put 2 moving averages on the chart, 5 expo (close) and 8 expo (open)
4th/ Wait for them to cross, lets do an hyperthetical example, they crossed up yesterday at some point, so new candle opened at 12.01am last night which would be todays candle.
5th/ Lets be a little conservative and add a indicator, its ok I am not a witch please don't burn me, we will add the RSI (14) with a 50 median line and so there is our line in the sand if after the cross the price was above the line exactly the same as the cross of the MA'S, then damn it lets go long, yes i know there would probably be a retrace maybe back to the 5ema, maybe even cross back over, its called probability, so I have cited 2 reasons there not to take the trade, 3 if the RSI isnt above 50. There will always be reasons not to trade, its monday, its Friday, big news day, its a counter trend on a monthly chart, i walked under a ladder yesterday.
6th/ Stoploss, Oh! yes a biggie this, so lets make it simple, the high or low of the cross candle, simples
7th/ Take profit, God I hate this one, a recent survey was done asking all forex traders what the most difficult aspect was in trading and this came out top, so where do we take profits, you could ask 100 different traders and get probably a 100 different answers, Fibos, support and resistance trendlines, diagonal trendlines, yesterdays, last weeks, last months high or low, pivot points, 200, 60ema's, now one thing i hate is when somebody on the forum says look at your chart and draw in by hand trendlines support and resistance, train your eyes to see them, yeah right I wear glasses I can't even see when a bus is coming, now before I get slated i know the importance of support and resistance really i do, but you sit 10 traders down and ask them to draw S & R on a chart and I guarantee that you will have 10 different looking charts, so clever clogs Tom what do you do? Me I set a target if i get a cross on a daily chart and a RSI confirmation then I want at least 50 pips, this may seem a bit gung ho but ask yourself this, if you have waited for a cross and got it, and it hits a trendline that only Mr Smith in Australia could see then what was the point in the first place, comprendi. Of course if you do get your 50 pips, then you can trail your stop blah blah blah, sorry that is going into the realms of complicated again.
Well thats my take on things anyway lets recap, what I would do.
1/Open a chart, BLANK
2/ Make it a daily chart
3/ Add 2 EMA'S 5 expo (close) and 8 expo (open)
4/ Add indicator RSI (14) median line 50
5/ Wait for Ema's to cross, wait for close of candle for confirmation
6/ Example Ema's cross up and RSI above 50 Stick your trade on
7/ Stoploss set to low of crossed candle
8/ Take profit 50 pips or down to you as an individual
9/ Do the same again with another pair
Good luck

Now in all seriousness, I may have been a bit flippant there but it's simple, it really is, its not the holy grail, dosent exist honest, I know that people are going to be saying this is what I do, this is what I use, this is what indicator I use, I trade at this time, I walk the dog, I pick the kids up, but that is YOU, so I hope I havn't offended anyone and all replys would be greatly appreciated even if to just call me an arse.

respect to all

Tom

Decided to put my money where my mouth is today so did a trade, Maybe considered a counter trend considering the strong trend in recent days on Aus/Usd, but when looking at longer timeframes a counter trend can be anything from a 50 - 200 pips, over night the Aus had been edging down, I watched the cross over on a 4 hour time frame which was on my 8.00am UK time candle, i waited for the close which was at 12.00, the EMA's were nicely parted and the RSI was dipping below 50, got to have a more than reasonable chance of another leg down, I entered and closed with 30 pips profit, it seems to have hit some resistance around the 1.0436 level, what ever that may be. Now yesterday I wrote and ranted and rambled on about the daily timeframe and taking at least 50 pips profit, I would never advocate going any less than the 4 hr tf, unless you want to stress yourself into a early hole in the ground, Just to add I set my original stop loss at 1.0505, which was the high of the cross trigger candle, there does seem to be a bit of a Usd bullish day today why? I don't know but there is a cross forming on e/u, e/g, u/chf, u/c, NZ/U, all on 4 hr Tframes, might be worth a watch
good luck all

Tom

P.S
Keep it Simples hey!

respect

Tom

Hello Tom...

I think you summed it all up very well. I have been digging myself an early grave trying to trade the 5 and 15 minute charts the past year with all of the chart watching and stress. So I am going to try the 4 hour and daily charts from here on. Will try out this simple moving avreage cross thing. Thanks for the entertaining read. Good luck to you.

Tony

Hi Tony
many thanks for your mail, firstly good luck my friend for your trading, Me personally I think it is as simple as you make it, how you want it to be, I have read hundreds of threads, strats with many many indicators, so many you need a pilots licence to run some of them, on timescale anything less than 4 hrs now scares me, and trading is addicive enough with out putting yourself in the 20 trades a day club, I got a mortgage and kids, my god thats stressful enough, Of all the strats over the years I have read this one does seem to be easy and manageable, it tells you where to get in and where to get out, simples, my problem always use to be money management, I was stubborn if a trade went against me I would think f--k you I am not losing and watch it go hundreds against me in alot of cases, what a dickhead I was, but now, I get the cross, stick the trade on set my stop to cross/trigger candle and a 30 pip for 4 hr and 50 pip for daily take profit, its not perfect and not the holy grail but for my personality its great, keep posting how you are doing and I do hope it works for you.
respect

Tom

Hi Tom (Booktimes),

I liked your recent postings and have one question: now that you stick to the simple cross with your profit target set at 50/30 pips and Stop at the cross bar are you now consitently ahead of the game and making money ?

Cheers

Keith

A great believer in the KISS theory!

Hi Heith
many thanks for your mail, I have made 5 trades in the last couple of weeks and had 5 winners, could have had more but not been at comp all the time, yeah I know ,it's not as if 4 hrs and daily arnt big enough time scales, what do I want hey!
What I did was, (I use metatrader for a demo platform like everyone else) I cleared my charts completely of any indicators, made them blank, then just added what I talked about before, started from scratch, it felt good like cleansing ones soul, I use to wake at 6.30am, be sat at my comp by 7, and stay there all day, my wife would work all day, come home and go mad at me, "hey, what have you been doing all day?" but you try and convince someone you have been sitting at a comp all day trading, performed 25 trades, 12 losers and 13 winners and made a fiver profit all day, no to a non trading outsider it didnt add up, all I use to get was "why do it" So i woke up one day and decided not too, now I just look at the charts (if I am home, yeah I go out now) at 8am, 12, 4pm and glance at 8pm, yeah the 4hr timeframes. Now like I said b4, this is ME, to some other folks they may like sitting at their comps all day, kudos to them,
So in the last few days I have performed (yes performed, it is a pantomime) 5 trades, 5 winners for a total of 230 pips, now some may scream, is that all, but I didn't take every trade that crossed, through one reason or another, but I did it with confidence, set my stop and profit and said goodbye.

Respect

Tom

Hi Tom
Thanks for the update I will keep an eye on the 4 Hr & Daily Charts for the signal.
Cheers.
Keith

I read this thread over the weekend as I don't mind indicators even though they lag. But I'm not doing well, I hope this is just another crazy week where any announcement by anybody in Europe sends the price in the opposite direction. I'm using the arrows, SEFC Bulls-Bears and Robby . . . I will just have to fine tune the entries better.

Morning guys
I have been doing a bit of demoing and live trading over the last week on this particular simple system, (Theres that word again) especially over the pairs, e/u, a/u and g/u, mainly because of low spreads and these seem to be the most popular pairs.
My simple no nonsence, take it how it is, don't answer me back else you will get a slap verdict was, that this system should be purely for a daily chart and above,
I dropped down a few times to the 4 hr charts and even entered a few trades, getting almost decimated, yes decimated I say on nearly all, admitedly the markets have been pretty choppy since the end of last year and what with the european debt problems, the forth coming U.S elections this year and Germany wanting to take over Europe (again) I feel a longer time frame is the only way, if we consider the 4 hr time frame, which to some people is long enough but compare it with the daily, it is only a 5th of a daily candle hence the whipsaw effect we are getting, whereas once the cross occurs on the daily time frame, it seems to create a trend or a change of trend for a few days at a time, look at the charts for the pairs I have mentioned.
So in my humble, not worth a jot, what does he know anyway opinion, I would say wait for a cross on the daily, before entering, Simples

respect
Tom