Just stumbled across this site and have found it amazing, so helpful in just one evening!
Anyway i was wondering what you think of this:
I have been swing trading for a few months now still on my demo account though, ive been trying to find pairs that generally fit in with my time (London) so as not to miss out on the start of trends while I’m asleep…
Prior to reading babypips college classes i had actually been using 5 EMA, 8 EMA and 15EMA moving averages, RSI 14, and stochastic (although i had it at 14 3 5 default setting) and also using MACD 12 26 9 to look for signals to go short or long.
I’m going to give that 5 EMA and 10EMA a run as it seems like a nice medium between 5 8 15EMAs, but i was wondering whether i should be looking to adjust my MACD figures accordingly and also the stochastics to 10 3 3… what kind of effect would this kind of change make when reading the data?
When I started out in this trading world, I also spent much energy on finding the best indicators and then trying to find the best settings for them.
Long story short, I don’t use indicators at all anymore. Never mind that, it’s another subject.
I believe that the answer to your question is that it doesn’t really matter that much whether you go with 8, 13 or 5, 10 MAs and likewise I don’t really think you need to change the MACD, RSI or stoch settings.
It makes little difference really and it evens out in the long run.
faster numbers = early entry and more whipsaws, slower numbers = later entry but fewer whipsaws. Your choice
Generally, using standard settings will work for you, and if it doesn’t work with standard settings, then I believe (just my 2 cents) that changing the settings won’t fix it. The problem then is with the system relative to current market conditions.
It makes a huge difference. As o990l6mh mentions, taking MACD as an example, shorter settings will give you many more entries, resulting in many more whipsaws (losses). Longer settings give you fewer entries, but make you “miss” a longer part of the move.
I ran a steamroller chart of my indicator’s settings to find the ones that fit my trading goals.
