The Sproule System
Below is a very simple system that I use both manually and also via an EA that I have written on a live account. It's easy to setup and doesn't require you to be sitting at the computer screen all day, only check it every few hours if doing it manually.
100EMA applied to close
1 hour chart
AUDUSD, EURJPY, EURUSD, GBPJPY, GBPUSD, USDCAD, USDCHF & USDJPY
Enter a buy position when the current price is above the 100EMA and the previous low is above the 100EMA.
Enter a sell position when the current price is below the 100EMA and the previous high is below the 100EMA.
Take Profit and Stop Loss
Set take profit at 100 pips
Set the stop loss at the current 100EMA value and keep moving the SL to the current 100EMA value each hour.
The open position and stop loss do tend to get wider as the trend gets stronger but the price and 100EMA SL will close in on each other minimizing the loss if the trade goes sour.
When it is a side ways trend you can either sit out and wait, or if like me and you use an EA you can take a small number of very small losses (this is because the 100ema keeps moving in on the price) and then you get the long trends.
I have had trades opens for a few days in profit and as long as you keep moving the SL to match your 100EMA you will profit nicely.
In regards to the 100 take profit, it gets hit alot but you also make alot of pips if the the price never reaches the TP, as it comes back to hit the SL that has been moving with the price.
And that's it..... feel free to leave comments and suggestions.
Last edited by aidysproule; 01-20-2012 at 09:18 AM.
I'm working on a similar system myself, and I have an idea for you. I added StDev to my system, when this deviation is below a certain number, you know the pair isn't going anywhere and you risk getting a lot of bad entries. (you do miss some good entries as well, since stdev lags a bit behind, you'll lose one good, but avoid potentially 10 bad?)
I have quite a lot of optimising to do but I'm confident my system could generate quite some pips! Hope yours improves as well!
Could you kindly upload a larger image?
Originally Posted by aidysproule
Its better you upload it in any image file sharing site and share the link with us.
could you upload a zoomed pic?
I like the idea of nice simple systems. Have you tried backtesting this over any period (either manually or with your EA)?
The problem with simple price/MA crossover systems is that they often suffer from too many false signals to be profitable in the long term. I tried backtesting this over various periods and each time, whilst there were some nice trends to be found, there were too many signals that lost.
While back testing, the issue was that the trade was entered, and then lost within the next few bars, so the MA had not moved enough to allow the stop to tighten. I was trading 2% on each trade, and as a result, the losses were too many so I couldn't make any profit. When you say that in a sideways movement your EA makes a few small losses, how is that? What is it doing to move the SL so as to reduce the risk?
I like the name "Sproule"
I found that there are many small orders triggered around the MA line, so I added "Once per bar" functionality. That means only one order per bar (one hour) can exist. I added StdDev (pipbiquitous idea) and the result is here:
FxDreema - The Sproule System
(click .mq4 or .ex4)
what is it used for?
Originally Posted by JDeel
i want to ask you take trades according to the first candle closes after touching the EMA? you look for a marubozu candle for ex? and one more question did you ever test it with NZD pairs?
Originally Posted by aidysproule
looks promising. thanks for sharing
I think that this system has much potential, I'll keep into consideration during the 2012 and making the necessary changes.
I think that the same system can also be applied for a time frame of 15 min or 4 hours, what do you think about?
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