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Trading with Heikin Ashi

  • Post #1
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  • First Post: Oct 5, 2006 2:48am Oct 5, 2006 2:48am
  •  jest1081
  • Joined Sep 2006 | Status: Chasing Trends | 2,339 Posts
Hi all,

I am a new to FX. I have read various methods of trading posted here, all very powerful styles, if applied correctly.

My favs :
1. Kolachi's 5WMA Price action
2. James16 Price action
3. Twoblink's OCC 55/56 tunnel

From this I created a separate system and style of trading. I have been backtesting it for a while and been fairly successful with it.

I trade the 4hr time frame due to commitments.
My chart set up:

EMA 21
EMA 55
LWMA 200
EMA Envelopes
RSI 9
Heikin Ashi Bars

Like Kolachi, i take price and action to enter trades which means i enter trades before the cross actually happen but instead of using 5WMA i use Heikin Ashi bars and RSI. I will post my trades here from now on.

There are 2 reasons why i don't take on MA crosses.
1. Lag
2. Whipsaw

They way i see it MAs are not only good trend indicators but also a good ossilator. They tend to draw away from each other after a correction during a good trend, this is what i call the fading effect or what many of you would call a whipsaw.

MAs also act good resistance areas, thus allowing you to use them as profit taking levels.


So here goes...this is SpeedFX.V2
  • Post #2
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  • Oct 5, 2006 11:16am Oct 5, 2006 11:16am
  •  senbanda
  • | Joined Nov 2005 | Status: Member | 84 Posts
Please give us some more information.
Senbanda
 
 
  • Post #3
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  • Oct 5, 2006 1:58pm Oct 5, 2006 1:58pm
  •  xxDavidxSxx
  • Joined Sep 2005 | Status: Full Time Trader | 1,780 Posts
Hello and welcome.

What is your entry trigger using Heikin Ashi Bars.

I have been looking for some way to use this indicater.

Dave
 
 
  • Post #4
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  • Oct 5, 2006 11:47pm Oct 5, 2006 11:47pm
  •  jest1081
  • Joined Sep 2006 | Status: Chasing Trends | 2,339 Posts
Hi senbanda,

You will get more info when you see my trades in the future.

David,

I don't really understand what you meant by trigger, but i use bar formation and the bounce from EMAs as signals, I dont trade on price crosses and ema crosses. I hope that answers your question.

Jest
 
 
  • Post #5
  • Quote
  • Oct 7, 2006 1:10am Oct 7, 2006 1:10am
  •  jest1081
  • Joined Sep 2006 | Status: Chasing Trends | 2,339 Posts
NZDUSD +18 pips
Long term trend showed liked the bull run against the US dollar is ending.

If you look at the charts, you will realise that i am using Donchian channels too, I intend to use it to further identify running trends where RSI keeps giving oversold indication. I will probably use it permenantly in this SpeedFX.
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  • Post #6
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  • Oct 8, 2006 3:36am Oct 8, 2006 3:36am
  •  xxDavidxSxx
  • Joined Sep 2005 | Status: Full Time Trader | 1,780 Posts
Quoting jest1081
Disliked
Hi senbanda,

You will get more info when you see my trades in the future.

David,

I don't really understand what you meant by trigger, but i use bar formation and the bounce from EMAs as signals, I dont trade on price crosses and ema crosses. I hope that answers your question.

Jest
Ignored
trigger....the exact thing that needs to happen the moment befor you click buy/sell order.

if its a bounce, do you enter befor the candle closes, or after. And if after do you wait for new bar to break high/low of bounce bar.<--just an example

But I am refering to how do you relate Heikin Ashi to this trade trigger.

Does Heikin Ashi have anything to do with your trigger or just alert you to a setup possibly forming?
 
 
  • Post #7
  • Quote
  • Oct 8, 2006 11:40am Oct 8, 2006 11:40am
  •  jest1081
  • Joined Sep 2006 | Status: Chasing Trends | 2,339 Posts
Hi David,

I get what you mean now.

These are my triggers,

1. Bounce from EMA 21 or EMA 55 confirmed with a HA bar without lower shadows.

2. Price break out from correction during a trend. Example from chart below.

From the above, if the first bar gives a strong signal, eg long bar without lower shadows, i will enter on second bar. Usually i will wait till the 3rd or 4th bar before entering. The reason why i use Heikin Ashi is due to the fact that the formations are easier to recognize compared to Candlesticks, which gives more complex signals, i still believe candlesticks are best used when coupled with an oscillator best 4 me would be a stoch osc.

Jest
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  • Post #8
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  • Oct 8, 2006 5:16pm Oct 8, 2006 5:16pm
  •  xxDavidxSxx
  • Joined Sep 2005 | Status: Full Time Trader | 1,780 Posts
Ok i got ya now.

Thanks.

Dave
 
 
  • Post #9
  • Quote
  • Oct 10, 2006 9:28pm Oct 10, 2006 9:28pm
  •  jest1081
  • Joined Sep 2006 | Status: Chasing Trends | 2,339 Posts
I haven't been in tune with the market recently...and thus missed many trades. Watching for audusd reversal....targetting a 50 pip move UP!.
 
 
  • Post #10
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  • Last Post: Oct 12, 2006 9:05am Oct 12, 2006 9:05am
  •  jest1081
  • Joined Sep 2006 | Status: Chasing Trends | 2,339 Posts
-27 pips

One of the worst things that could happen to a trader is to be right about the direction of a market but got stopped out before the price moves. The signals for a reversal in the audusd pair was so strong that i was so convinced that it would be ok to trade against the trend i wasn't really looking for a rebound off either MAs.

Call it overconfidence or plain ignorance, i was a t work when i got stopped out. Refer to chat below and watch my pain...
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