Hello, Traders!
The system I’m going to introduce here has nothing new in it. I just tried to describe it with some strict set of rules as much as possible.
The beauty behind this system is that initially it does not rely heavily on indicators. There is no such thing in it as “when indicator 1 does that and that and indicator 2 crosses lvl such and such, I enter long or short”. I believe this kind of approach to be essentially wrong because when you rely only on indicators they do not give you the perspective of what price is doing.
Use indicators to guide your entry only after you’ve examined PA and you know what pattern or model you’re playing. Be that Double Top or Bottom, Head and Shoulders, 1-2-3 Pattern e.t.c.
Use visual tools first – trend lines, divergences, S/R and fib lvls and then use indicators to enter.
I don’t know how to emphasize more on this, but once you get this idea in your head, you can use any indicators you like for your entries.
For our PA examination we’re going to use Trend Lines and Divergence. But before I get to the explanation of the system itself let me talk about some important general stuff first.
General Info:
1.Timeframe: I use 5M TF. It suits my needs of active intraday trader the best. This doesn’t mean that the system won’t work on other timeframes, but initially this thread is intended for intraday trading.
2.Timing: I advice to look for trade opportunities during following market hours: 5 GMT – 8 GMT and 11 GMT – 15 GMT. This is how the pro’s do it, so instead of inventing the wheel lets just do what people who really make money on forex do. I got these timing hours from one of the best threads here on FF – the Sonic R thread (http://www.forexfactory.com/showthread.php?t=114792). Plus that’s how Dean Malone does it on compassfx. So if for some reason you don’t believe me, go and see what these people tell you.
3.Pairs to trade: I trade only EURUSD with this system. Again, this doesn’t mean it won’t work on other pairs, instead I believe that first the technique has to be mastered to the point where you do not miss any trade opportunities on one pair. Add more pairs only after you’ve felt that you can use it effectively at least with one pair.
Template:
Here I’m going to describe the indicators I use and why I use them.
1.MACD (12, 26, 9) – I use for spotting divergence and I trade only with its direction.
2.Stochastic (5, 3, 3) – I use it to spot divergence where it can’t be identified with MACD.
3.EMA’s 20, 50 and 200 – I use them for visual trend identification.
4.IB (Inside Bar) – I use this indicator to spot low-volatility areas in the market.
5.Fractals – I use them to identify pullbacks and points used for drawing trend lines.
6.Semafor (8, 13, 34) – I use this indicator to identify price swings and points which are used for trend line drawing.
7.PivotsD_v5 – I use this indicator for identifying intraday S/R lvls and targets for TP lvls.
---------------------------------------------------------------------------------------------------------------------------------------
Update:
Read post #42 for additional entries we're considering at this thread: http://www.forexfactory.com/showpost...1&postcount=42
Read following posts for some additional useful info:
http://www.forexfactory.com/showpost...&postcount=135
http://www.forexfactory.com/showpost...&postcount=151
http://www.forexfactory.com/showpost...&postcount=158
http://www.forexfactory.com/showpost...&postcount=200
The system I’m going to introduce here has nothing new in it. I just tried to describe it with some strict set of rules as much as possible.
The beauty behind this system is that initially it does not rely heavily on indicators. There is no such thing in it as “when indicator 1 does that and that and indicator 2 crosses lvl such and such, I enter long or short”. I believe this kind of approach to be essentially wrong because when you rely only on indicators they do not give you the perspective of what price is doing.
Use indicators to guide your entry only after you’ve examined PA and you know what pattern or model you’re playing. Be that Double Top or Bottom, Head and Shoulders, 1-2-3 Pattern e.t.c.
Use visual tools first – trend lines, divergences, S/R and fib lvls and then use indicators to enter.
I don’t know how to emphasize more on this, but once you get this idea in your head, you can use any indicators you like for your entries.
For our PA examination we’re going to use Trend Lines and Divergence. But before I get to the explanation of the system itself let me talk about some important general stuff first.
General Info:
1.Timeframe: I use 5M TF. It suits my needs of active intraday trader the best. This doesn’t mean that the system won’t work on other timeframes, but initially this thread is intended for intraday trading.
2.Timing: I advice to look for trade opportunities during following market hours: 5 GMT – 8 GMT and 11 GMT – 15 GMT. This is how the pro’s do it, so instead of inventing the wheel lets just do what people who really make money on forex do. I got these timing hours from one of the best threads here on FF – the Sonic R thread (http://www.forexfactory.com/showthread.php?t=114792). Plus that’s how Dean Malone does it on compassfx. So if for some reason you don’t believe me, go and see what these people tell you.
3.Pairs to trade: I trade only EURUSD with this system. Again, this doesn’t mean it won’t work on other pairs, instead I believe that first the technique has to be mastered to the point where you do not miss any trade opportunities on one pair. Add more pairs only after you’ve felt that you can use it effectively at least with one pair.
Template:
Here I’m going to describe the indicators I use and why I use them.
1.MACD (12, 26, 9) – I use for spotting divergence and I trade only with its direction.
2.Stochastic (5, 3, 3) – I use it to spot divergence where it can’t be identified with MACD.
3.EMA’s 20, 50 and 200 – I use them for visual trend identification.
4.IB (Inside Bar) – I use this indicator to spot low-volatility areas in the market.
5.Fractals – I use them to identify pullbacks and points used for drawing trend lines.
6.Semafor (8, 13, 34) – I use this indicator to identify price swings and points which are used for trend line drawing.
7.PivotsD_v5 – I use this indicator for identifying intraday S/R lvls and targets for TP lvls.
---------------------------------------------------------------------------------------------------------------------------------------
Update:
Read post #42 for additional entries we're considering at this thread: http://www.forexfactory.com/showpost...1&postcount=42
Read following posts for some additional useful info:
http://www.forexfactory.com/showpost...&postcount=135
http://www.forexfactory.com/showpost...&postcount=151
http://www.forexfactory.com/showpost...&postcount=158
http://www.forexfactory.com/showpost...&postcount=200
Attached File(s)
still on tests
