FreeFX # 134: review of SPX and my trading strategy

Trading Discussion
1

Hello traders!

I had a question on Twitter about my trading, therefore in this video
I go into detail about how I trade and approach trading.

Check the YouTube page to see the time-stamps and details
for the video.

Cheers
Happy Trading

PipMeHappy

1 Like
2

Very detailed discussion, Francesco. Great job! :blush: I might have missed it though, but for your strategy, do you have any particular entry or exit signals? :blush:

1 Like
3

Hello @ria_rose ,

thank you very much, I appreciate your feedback, and I am very happy to answer your question.

The signals are not mechanically set, because my platform does not have the tools (nor do I have

the programming skills) to alert me of situations such as, for example:

" If price touches upper/lower Bollinger Band";

" If price crosses the basis (=20 MA) from above/below";

“if CCI reaches +200/ -200”.

However, I watch the above situations often enough that
I am ready to act when these conditions occur.

Market context also seems very important, e.g.: trading for a big reversal
on a low-ATR day when the previous day candle was tiny, probably will not
be easy to achieve with confidence.

To summarise:

  • I tend to trade price interacting with the Bollinger Bands (long from the lower band
    and short from the upper, generally speaking). Price tends to move from one band to
    the one opposite, or from one band to the middle moving average and back to the band
    (this tends to happen in a strong trend), therefore these three lines are the ones that I watch
    a lot, mostly on the four-hour chart;

  • I use the CCI to guide me in terms of confirming the strength of a move, or how overextended
    it may be, and looking at signs of divergence (e.g. just like you would with other oscillators such
    as RSI).

I hope this answers your questions, but keep them coming if you have more.

PipMeHappy

4

Great video! Thanks for explaining your strategy too. Haven’t ever looked at CCI indicator. I’ll add it to the bag and see if it provides any worthy signals.

Another question, though. Are you trading FX at all?

1 Like
5

Thank you @samewise I am glad to hear it.

No, I hung up my forex trading a year ago (Sep 2021) after many years of trying and failing, I figured it was a bad asset class to trade, and going to indices has been such a blessing.

6

Was there a big learning curve with the switch or really more of what you were already doing?

7

And what’s your index of choice?

8

Yes, forex is too unpredictable for me. Except for big trends like the one we have seen from the Pound or the Euro since 2021, it is often the case that they chop around etc. Also, there are two conflicting fundamentals that give a pair little direction if you are a day trader, just looking at the EurGbp as an example. Or look at USD/MXN, which I try trading for a while.

My index of choice is the S&P500 in the form of SPX.

9

Glad you found something that works. Doesn’t matter what it is, as long as you can successfully trade it!