Synergy Trading Method

[droesparky]

I found this elsewhere, take a look at it. It looks pretty good to me.
There is a nice pdf file for this system, but its to big to upload even when I zip it.

The Synergy Trading Method was developed by Dean Malone and is an effective Forex trading method developed to simplify trading decisions with high probability precision. It combines the market forces of Price Action, Trend, Momentum and Market Strength to produce higher probability trades. The Synergy trading method depicts...in real-time...the interaction of these market forces providing traders the means to make trading decisions with greater confidence and less emotional hassle.




With Synergy, traders identify and use two important trading components in real-time: Price Action and Sentiment.

Price Action is market movement, such as the oscillation of Open, High, Low and Close prices. Too often, traders are mesmerized by trivial price flucuations and lose sight of the underlying trend of the market. Many traders tend to jump in and out of the market instead of staying with the trade as a trend develops. Synergy is designed to eliminate price distortions. It reveals periods of market strength and trend and periods of consolidation.

Sentiment is the intuitive feeling or attitude of traders and investors in the market. For example, if the sentiment of the market is bullish, then traders and investors expect an upward move in the market. Often, sentiment is an indication of optimism or pessimism in the market based on recent news announcements or political events. The Synergy method uses a hybrid custom indicator developed to show postive (buyers) sentiment or negative (sellers) sentiment.

Working in unison, Price Action and Sentiment give traders a distinct trading advantage. When both are in agreement, favorable trading conditions exists. For instance, when price action is showing upward movement with buyers sentiment, there is higher probability of a Long position having a favorable outcome. Similarly, when price action has a downward movement in conjunction with sellers sentiment, a short position has a favorable outcome.

Aim of this thread is to backtest and optimize the strategy and finally to make an EA out of it. In this first post you find the up-to-date indicators and templates.

First backtests show that the strategy works best on the 1H or 30M timeframe with the GBPUSD, EURJPY, EURUSD, GBPJPY, USDCHF, USDJPY and CADJPY. Here are some average results:

GBPUSD: ~ 160 pips per month
EURJPY: ~ 104 pips per month
EURUSD: ~ 100 pips per month
GBPJPY: ~ 95 pips per month
USDCHF: ~ 85 pips per month
USDJPY: ~ 82 pips per month
CADJPY: ~ 75 pips per month

To setup this strategy, please unzip Synergy.zip and copy all indicators into \experts\indicators\ in your metatrader directory. Then copy the template into \templates in your metatrader directory. After restarting metatrader and choosing the template you can see arrows and crosses which shows entries and exits according the trading method. Each cross displays a number which means the profit or loss of the closed trade. The yellow numbers at the end of the chart displays the overall result when every signal was traded. But be careful: due to some technical problems with the template at the beginning of a chart no guarantee can be given. A filled arrow shows the first time a new trade can be entered. A hollow arrrow means "add to buy" it is only used as a confirmation signal.

For backtesting the some options of SynergyInd indicator can be adjusted:

UseEntry68_32: When this is true, the indicator enters a long position even when RSI is above 68 or a short position when RSI is below 32.
UseSmallerExit: When this is true, the system closes a position when the actuall candle is smaller than the previsous candle. "DefineSmaller" needs to be a value.
ReqRedYellowCombo: When this is true, the TSL must be above the MBL before entering a long position or the TSL must be below the MBL before entering a short position.
UseVolExpanding: If this is true, positions are only opened when volatility increases (measured by the Bellinger Bands of the TDI).
UseChaikin: If this is true, positions are only opened when colatility increases (measured by the Chaikin's Volatility indicator).
Use4Trend: If this is true, long positions will only be opned when the 4H trend is up and short positions will only be opened when the 4H trend is down.
Use Alert: ... I think everybody knows this feature.

So far the following settings seem to work most suitable: UseEntry68_32 false, UseSmallerExit false, ReqRedYellowCombo false, UseVolExpanding true, UseChaikin false, Use4Trend false.

[ahefner33]

Good system...I have been testing this around a month now..But I started using real candle sticks because the HA candles seem to give traders a false indication where price is if you dont know what your looking for.

Actually, one guy told me that Dean Malone uses candle sticks but shows the HA because it makes it easier for new traders to understand.

But I like it, add the power of using higher time frames as a direction to trade and enter off your lower time frames, it can make you some money.

AH

[Harry]

Originally Posted by ahefner33

Good system...I have been testing this around a month now..But I started using real candle sticks because the HA candles seem to give traders a false indication where price is if you dont know what your looking for.

Actually, one guy told me that Dean Malone uses candle sticks but shows the HA because it makes it easier for new traders to understand.

But I like it, add the power of using higher time frames as a direction to trade and enter off your lower time frames, it can make you some money.

AH

I have faced such problem with this method when I used it for the first time but with time I am used to it and now I find it good. It was just a matter of time that this method proved better then others for me. making money for me which is what a trader wants!!

[Moddy]

Originally Posted by Harry

I have faced such problem with this method when I used it for the first time but with time I am used to it and now I find it good. It was just a matter of time that this method proved better then others for me. making money for me which is what a trader wants!!

Yes initially we all generally face problem when we try any thing new for the first time but as we get use to it we start liking it and get habitual to it. Just give little time to it and you will be comfortable with it.

[branac]

Hi everybody,

I have been testing Synergy for a month or so, like it very much. Thank you droesparky for the indicator and template you posted, it makes finding signals a lot easier.

There is one thing I've noticed so far. If there is a divergence between the price and the green line, than the signal is most likely not going to work. There is an example on the attached GBP/USD 4hr chart, check the area with purple lines. From one buy signal to the other, the price made a higher high but the green line made a lower high, and then the signal failed. I am going to do more testing on this one, but I was wondering if someone who is good with MT4 programming could incorporate this divergence in the indicator?

Thank you,
branac

[hjamident]

I am new at this. I tried to unzip the attached "synergy.zip" file without any success. I could not use what was downloaded. The system sounds very logical and practical. Can you provide me with the proper way to download the system? Thanks.

[Superion]

This is also known as Dean Malone E A S Y Method. I've been looking to this method for sometime but gathering the required indicators was a tall order. Just our luck that somone has coded it for us.

Surely to code and EA shouldn't be a painful task as the SynergyInd provides entry and exit signal code right there for the taking below.

We need to create an EA that calls on this part off the code to place orders and exit our positions.

The question is how do we call this Indicator. My guess is using the iCustom cmd but I'm a rookie mql programmer.

Also droesparky how did you backtest without an EA in place?

	// Main loop
	for (i = limit; i >= 0; i--) 
	{
		AcquireIndicatorValues(i);
		
		// Check for open signals ---------------------------------------------
		MA_Trend_Dir = GetMA_Trend();
		HA_Outside_MA_Dir = GetHA_CloseDir(i);
		TDI_Dir = GetTDI_EntryDir();
		H4_Trend = GetH4Trend(i);
		
		// Calculate where to put arrows (and labels)
		upperPos = MathMax(High[i], MathMax(HA_HiLo_2, HA_LoHi_2)) + (sp*Point);
		upperTextPos = upperPos + ((sp)*Point);
		lowerPos = MathMin(Low[i], MathMin(HA_HiLo_2, HA_LoHi_2)) - (sp*Point);
		lowerTextPos = lowerPos - ((sp/4)*Point);
		spread = Ask - Bid;
		
		// If all in Long position, signal to BUY at this candle's open
		if (!InBuy && MA_Trend_Dir == OP_BUY && HA_Outside_MA_Dir == OP_BUY && 
			TDI_Dir == OP_BUY && (!UseVolExpanding || VolBandsExpanding()) && 
			(!UseChaikin || Chaikin > 0) && (!UseH4Trend || H4_Trend == OP_BUY))
		{
			BuyEntryBuf[i] = lowerPos;
			InBuy = true;
			OpenPriceB = Open[i] + spread;
			DoAlert(i, "Synergy: New Buy Signal, candle = " + i);
		}
		
		else if (InBuy && AddToBuyPosition())
		{
			AddBuyBuf[i] = lowerPos;
			DoAlert(i, "Synergy: Add to Buy Signal");
		}
		
		// If all in Short position, signal to SELL at this candle's open
		if (!InSell && MA_Trend_Dir == OP_SELL && HA_Outside_MA_Dir == OP_SELL && 
			TDI_Dir == OP_SELL && (!UseVolExpanding || VolBandsExpanding()) && 
			(!UseChaikin || Chaikin > 0) && (!UseH4Trend || H4_Trend == OP_SELL))
		{
			SellEntryBuf[i] = upperPos;
			InSell = true;
			OpenPriceS = Open[i] - spread;
			DoAlert(i, "Synergy: New Sell Signal");
		}

		else if (InSell && AddToSellPosition())
		{
			AddSellBuf[i] = upperPos;
			DoAlert(i, "Synergy: Add to Sell Signal");
		}
		

		// Check for close signals --------------------------------------------
		HA_Closed_Inside_MA = GetHA_ClosedInside();
		TDI_Dir = GetTDI_ExitDir();
		CandleSmallerOrOpp = GetCandleSmallerOrOpposite();
			
		// If all in Short position, signal to EXIT LONG at this candle's open
		if (InBuy && CandleSmallerOrOpp == OP_SELL || HA_Closed_Inside_MA || TDI_Dir == OP_SELL)
		{
			BuyExitBuf[i] = upperPos;
			InBuy = false;
			pipsMade = (Open[i] - OpenPriceB) / Point;
			RunningTotal += pipsMade;

			// Create label for pips made for this trade
			clr = Red;
			if (pipsMade >= 0)
				clr = Green;

			if (!IsEA_Calling)
			{
				name = "SynIndBuy" + DoubleToStr(i ,0);
				text = DoubleToStr(pipsMade ,0) + " - " + ExitReason;
				ObjectCreate(name, OBJ_TEXT, 0, Time[i], upperTextPos);
				ObjectSetText(name, text, 8, "Times New Roman", clr);
				DoAlert(i, "Synergy: Exit Buy Signal");
			}
		}
				
		// If all in Long position, signal to EXIT SHORT position at this candle's open
		if (InSell && CandleSmallerOrOpp == OP_BUY || HA_Closed_Inside_MA || TDI_Dir == OP_BUY)
		{
			SellExitBuf[i] = lowerPos;
			InSell = false;
			pipsMade = (OpenPriceS - Open[i]) / Point;
			RunningTotal += pipsMade;

			// Create label for pips made for this trade
			clr = Red;
			if (pipsMade >= 0)
				clr = Green;

			if (!IsEA_Calling)
			{
				name = "SynIndSell" + DoubleToStr(i ,0);
				text = DoubleToStr(pipsMade ,0) + " - " + ExitReason;
				ObjectCreate(name, OBJ_TEXT, 0, Time[i], lowerTextPos);
				ObjectSetText(name, text, 8, "Times New Roman", clr);
				DoAlert(i, "Synergy: Exit Sell Signal");
			}
		}

[droesparky]

my bad for not answering this in a long time.

Long before there where EA's we did manual backtest. EA's in my thoughts are very capable of giving you false security in a system. But at some point you have to forward test. thats the true measure of a system.

As I said it wasnt my system I got it off of another forum, and it does seem to work.

[dipson]

Does this really work, if so i will try it.
Thanks for sharing.

[grayghost]

Originally Posted by branac

Thank you droesparky for the indicator and template you posted, it makes finding signals a lot easier.

Droesparky:

The Synergy indicator shows promise. Based on the chart shown in the previous post, which I have tinkered with below below, I think the entry, continuation, and exit rules could stand some augmentation. The initial entry seems to come too late, the corresponding exit way too soon, the second entry again too late, and the corresponding exit again too late. I looked at other portions of the chart and other currency airs, and the timing problem seems to be general. I suspect that the lateness problem derives not from the Synergy indicator itself but from the way it is used. I am thinking of applying my own rules and using the Synergy as a check on my own method.

I trade breakouts like the one in the subject post, on the daily time frame. I use standard candles for price action, the Ichimoku and the ADX for trend recognition, and MACDH for divergences. I call this method the Breakout (catchy, yeah?). It would not be easily automated, because it involves judgment calls and drawing tools that would be difficult to describe adequately. I do not get many signals this way--maybe one or two per currency pair per year--but they are high-probability, enabling me to risk a larger portion of my account on each trade. So, if you are looking to trade continually, my approach may not be appropriate.

Unlike my Breakout method, the Synergy indicator is quite mechanical and presumably amenable to automation. I should say here that I do not believe that any automated trading method has ever proved profitable over the long run, because conditions change and there usually are complications that can be easily assessed by the brain but not by a set routine. I believe indicators are better used to augment discretionary decisions. However, should you want to develop an EA, the Synergy indicator seems like a good basis.

I will compare my Breakout method with the Synergy indicator and will than propose changes in the way the Synergy is interpreted. In the first chart below, I’ve used my discretionary Breakout method to trade the same chart as shown in the post. Reasons for decisions are given on the chart. Note that I got in earlier than the Synergy did and that I stayed in all the way to the top, adding to the position at one point, and realizing about three times as many pips as did the Synergy.

The second chart is the one shown in the previous post. I do not know exactly what criteria you use to evaluate the indicator signals, but your general approach is obvious. (Do you know where I might find a Synergy manual?) I have left the Synergy entry and exit points on the chart but have traded it using Synergy rules of my own devising, which I have noted on the chart. In this way I was able, using the Synergy indicator, to duplicate the trade I mounted using the breakout method. The criteria I used are noted on the chart.

If the Synergy is used as the basis for an EA, or merely in conjunction with discretionary trading, I suggest that my criteria be tried. Since they are based only on a single chart, they probably would need to be generalized for across-the-board use. But you get the idea.