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Simple 5 / 8 moving average crossover

  • #881
  • Apr 1, 2010 8:38am Apr 1, 2010 8:38am
Whip-saws are common with a MA cross system . Thats where momentum , trend oscillators are used to confirm direction and momentum.
Look at Chamane's chart a few posts back. If the MACD or Stochastics or RSI ( whichever oscillator you chose to use ) doesnt confirm the Crossover you would pass on the trade and wait for a new set-up where the MA's , RSI , MACD or Stoch all agree .
" Master Your Set-Up , Master Yourself "
  • #882
  • Apr 1, 2010 1:48pm Apr 1, 2010 1:48pm
Quoting peterM
I have been using a strategy for a few months now. It is very simple and I have followed the rules exactly. Its certainly not holy grail but it has made me some nice pips over the last few months.

I use the 5 EMA and 8 EMA crossover on the daily chart. For the stop loss I use the low or high for the previous day (depending on if we are or short). Alternatively if this is too close or too far away, so the risk/reward ratio would be too low, I draw fib lines on the daily chart and trendlines to try and pickout important support and resistance points...

Agree with you. I use 5,10 ema's and it's not the holy grail, but it's realistic and it makes $ when you follow your system and stick to your guns. KISS is key. Can't be said enough.
  • #883
  • Apr 1, 2010 1:49pm Apr 1, 2010 1:49pm
Quoting yunielescaz
the cross over needs filters. i just watched a cross over get UNCROSSED and continue in the opposite direction right in front of my eyes. on the gpd/usd pair

Listen to EZTrades, he's got the right idea on filtering these
  • #884
  • Apr 5, 2010 5:58am Apr 5, 2010 5:58am
Quoting yunielescaz
the cross over needs filters. i just watched a cross over get UNCROSSED and continue in the opposite direction right in front of my eyes. on the gpd/usd pair
.

I've been using this cross over for years and its been so good. But it doesnt work well on its own, and one of the best ways of using MA crossovers is to apply them at the close of candle formation and not in the the process of the candle formation.

You can fiddle with some indicators and come out with your own combinations to help filter out bad signals, but i use RSI 14 0r 13 and Stochastic Indicator with a setting of 8,3,3.

Its also good to take crosses in line with a higher time frame's direction.

But if you know you dont have the time to check your system for signals as often as the time frame you use, then i'll advise you run away from this technique and look for something that suites you..

Hope you'll find this simple technique useful.
God's Love For You Is Sure Never You Doubt It
  • #885
  • Edited 4:56am Apr 6, 2010 4:35am | Edited 4:56am
Quoting D liberators
.

I've been using this cross over for years and its been so good. But it doesnt work well on its own, and one of the best ways of using MA crossovers is to apply them at the close of candle formation and not in the the process of the candle formation.

You can fiddle with some indicators and come out with your own combinations to help filter out bad signals, but i use RSI 14 0r 13 and Stochastic Indicator with a setting of 8,3,3.

Its also good to take crosses in line with a higher time frame's direction.

But if you know you dont have the...
Hi,

Thanks for your input on your tweaks of the system.

I wonder what you look for at the Stochs and RSI? Any particular levels, or just the major changes? Have you tested using MACD as well, or do you get the same results with the other two?

It has been mentioned in this thread that it is good to apply thr 8 EMA to the open and the 5 to the close. What is you input on this?

Regards

Archie
  • #886
  • Apr 12, 2010 3:00am Apr 12, 2010 3:00am
This is a really simple and effective system. It's a shame that this thread is so quiet.

It would be nice to discuss experiences and different approaches.

I am watching this thread, so if anyone is trading this system, please feel free to jump in!

Archie
  • #887
  • Apr 12, 2010 3:13am Apr 12, 2010 3:13am
SMMA 5/8 works fine as well
SMMA Crossover arrows
http://s46.radikal.ru/i113/1004/5f/e2dae2fe8457.jpg
  • #888
  • Apr 12, 2010 3:43am Apr 12, 2010 3:43am
Hi,

Do you trade the daily TF as well? What differences have you seen between SMA and EMA? I think that since the periods are fairly small, the EMA is more responsive, but trading on larger TF's perhaps the differences are smaller.

Archie

Quoting dimaxx
SMMA 5/8 works fine as well
SMMA Crossover arrows
http://s46.radikal.ru/i113/1004/5f/e2dae2fe8457.jpg
  • #889
  • Apr 12, 2010 6:42am Apr 12, 2010 6:42am
Quoting Archie
Hi,

Do you trade the daily TF as well? What differences have you seen between SMA and EMA? I think that since the periods are fairly small, the EMA is more responsive, but trading on larger TF's perhaps the differences are smaller.

Archie
SMMA stands for Smooth moving average.
i use it aplied to median price and for only long term trades.
for short term trades i use 20 sma - breaks above - buy, below - sell.
  • #890
  • Apr 12, 2010 9:41am Apr 12, 2010 9:41am
For daytraders, i suggest using ema close 288 on 5 min tf. Only take long position when price above the ema and vice versa. Why 288? 288 x 5 = 24 hour.
Good trading
  • #891
  • Apr 12, 2010 10:34am Apr 12, 2010 10:34am
Good morning/ afternoon,

Bill Williams Alligator system is very similar to what's being discussed here.

"the alligator indicator.
The alligator was first
described by Bill Williams
in his book New
Trading Dimensions.
Some software packages
include the alligator
indicator, but if it’s
not available, all you
have to do is take three
smoothed moving averages
using 13, eight, and
five periods and shift them by eight, five, and three bars into the future. The longest
period line is blue (the alligator’s jaw), the middle one is red
(the alligator’s teeth), and the shortest one is green (the
alligator’s lips).
According to Williams, when these three moving averages
are twisted together, it means the alligator indicator rests, and
so we also rest. But the longer the alligator sleeps, the
hungrier it is. So when the alligator awakes after a good, long
rest it is very hungry to hunt for food. And its food is price."

Unfortunately the software I'm using doesn't have a code for a smoothed moving average

But still working on it
  • #892
  • Apr 12, 2010 1:51pm Apr 12, 2010 1:51pm
Quoting dimaxx
SMMA stands for Smooth moving average.
i use it aplied to median price and for only long term trades.
for short term trades i use 20 sma - breaks above - buy, below - sell.

Hi,

Thanks for your input. I havenät used smoothed MA's before. Worth looking into.

What sort of exit strategies do you use, profit levels? Also, how about SL, do you watch previous high/low or previous candle?

Regards

Archie
  • #893
  • Apr 13, 2010 2:25am Apr 13, 2010 2:25am
Quoting Archie
Hi,

Thanks for your input. I havenät used smoothed MA's before. Worth looking into.

What sort of exit strategies do you use, profit levels? Also, how about SL, do you watch previous high/low or previous candle?

Regards

Archie
I use trailing robot to do the job. settings depend on pair.
Attached File(s)
File Type: ex4 e-trailing.ex4   3 KB | 736 downloads
  • #894
  • Apr 14, 2010 7:41pm Apr 14, 2010 7:41pm
hello guys!
well,im new here ,first of all i want to thank everyone for the great information that are shared in this forum!

well,i've been using this system for about 6 months in 4H tf and 90% of the times the result were great, after a lot of wins and 40% profit of my capital, these last weeks i had 12 consecutive losses! - what is not good at all! all this because i had a lot of false signals,because the market was choppy and indecisive , i use RSI and stohastics to filter my trades,but still are not enough,ive tried some stuff sugested in this thread but nothing is working for me, is just me who is having this problem lately?

If anyone have any other suggestion to filter these bad signals,i will appreciate thanks everyone! and i agree that this system is pure gold!
regards
  • #895
  • Apr 14, 2010 11:26pm Apr 14, 2010 11:26pm
Here is my own coded 5(close) and 8(open) smooth EMAs if some one need.
Attached File(s)
File Type: mq4 smma.mq4   3 KB | 1,060 downloads
  • #896
  • Apr 16, 2010 10:03am Apr 16, 2010 10:03am
Quoting Forex-Girl
hello...
One thing I would add to your filters is to check the 5/8 ema cross on the next or two next higher timeframes and avoid entries if one of them is not compatible.
  • #897
  • Apr 17, 2010 11:14am Apr 17, 2010 11:14am
alligator is standard equipment in metatrader

hope this helps
  • #898
  • Apr 19, 2010 12:35am Apr 19, 2010 12:35am
anyone try midnite to midnite with a signal and running it till profitable or till it changes next midnite? Seems profitable. Set profits and stop loss. More mechanical.
  • #899
  • Apr 19, 2010 8:42am Apr 19, 2010 8:42am
I don't want to be negative , but I tried MA crosses on a live account ,and cross over signals will repaint ALOT ,IMO its not the best way to trade and this thread has too many replies because only the simplicity of the method.
  • #900
  • Apr 20, 2010 8:24pm Apr 20, 2010 8:24pm
Brb-Fraudin ,

What do you mean MA crosses repaint alot ? MA crosses do NOT repaint. They have whip-saws ( false trend cycles ) but if you filter your trade signals by use of a larger TF and trend/momentum oscillators , this will cut down on alot of losing trades. Also , if you manage your risk , the winners on a MA cross system when you let them run is far greater than the small losing trades. MA cross systems are probably one of oldest , simplest , most profitable systems out there if you have done the work to research them , study them and get in 100's if not 1000's of hours of screen time to gain the confidence that they do indeed work and are profitable.

EZ Trades
" Master Your Set-Up , Master Yourself "
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