My Trading System

Hi all. Just like topchess, I decided to put on my own system for you guys to check it out.
I’d also recommand checking it on demos before going for the real deal. nevertheless, from my expreience with it, it’s pretty good. started using it last week, and hit about 11 out of 15 trades.

enough talking. here goes:

[U]Trading Setup[/U]
Trade on 1 hour chart
26 EMA applied to the close (RED)
50 MA applied to the close (BLUE)
100 MA applied to the close (YELLOW)
Stochastics (10,3,3)
MACD (12,26,9)
ADX (14) (Optional)

[U]Trading Rules[/U]
Stop Loss:
will be determined by MAs, and other supports levels.
maximum stop loss would be 2% of capital.
Take Profit:
will be determined by MAs, Fibonachi and other resistance levels.
win\loss ratio MUST be 1:1 or better!

[U]Entry Rules[/U]
[B]Enter long if[/B]:
Trend* is bullish
Stocks are at oversold
MACD doesn’t show convergance (against you)
26MA and 50MA haven’t crossed against you recently (10 previous


Trend* is bullish
MACD shows convergance (in your direction)
stocks are not at overbought
<in this case go to 15M frame and catch the best price possible using bollinger and stochastics>

[B]Enter short if[/B]:
Trend* is bearish
Stocks are at overbought
MACD doesn’t show convergance (against you)
26MA and 50MA haven’t crossed against you recently (10 previous


Trend* is bearish
MACD shows convergance (in your direction)
stocks are not at oversold
<in this case go to 15M frame and catch the best price possible using bollinger and stochastics>

[U]Exit Rules[/U]
one of the following occurs:
Trend* is over
Stocks are overbought\sold (against your position)
MACD shows convergance (against your position)
MAs cross against you

*I usually define the trend using the 100MA, and by my own eyes actually.
If I wanted confirmation I’d switch to 4 hours chart and make sure.
However I took Chess’s advice on using the ADX (Average Directional Movement Index). so a trend would either be MA100 going up (and not a one time candle who pushes it up) for a period of at least 40 candles OR ADX>40 (optional)
Use MACD signals as indicators for a trend as well (value goes from negative to positive is bullish and vice versa)

Looks good. Do you think you could post your trades with charts so we can see what its supposed to look like when you enter and exit? Thanks for posting.

…and this is how it looked like today.
in both cases I spotted a trend, stocs were oversold\bought and MAs & MACD were okay with it. I used fibonacchi levels a lot to set TP and SLs however I don’t want to visually overload you guys, so just trust me on this one :wink:

Chart 1
both striped lines represent TP1 and TP2.
both were chosen according to fibonachi retracment levels.
forgot to add the SL to the picture - was at about 1.3254, which is as well a fibonachi resistance level. (61.8)

Chart 2
in this one I almost got into the first (orange) trade, however I noticed that exactly 10 candles ago there was a crossover against me. I decided to be disciplined and didn’t trade (the Orange X mark). unfortunatly I forgot to check on it later on as there were 30 pips available easily, and a lot more with 2 lots. too bad. next time.
in the trade I DID get in to:
blue striped line stands for TP. chosen because of previous resistance there (and close enough to fibo [100.0])
oh, and ofcourse, Stocs are oversold again.
red one stands for SL. chosen by both fibo and 100MA.
you can see that in this one, unfortunatly I didn’t hit the entire jackpot. 30pips still pretty good, but if I used 2 lots (1 trailing stop) might have been a lot more.

very nice screenshots, parsush. it seems you’re using candlestick patterns (doji spear, hanging man…) as well to enter, am i correct?

originally written by londont:

very nice screenshots, parsush. it seems you’re using candlestick patterns (doji spear, hanging man…) as well to enter, am i correct?

I’ll use whatever it takes to make me filfthy rich!! :smiley:

just kidding… while I might use patterns to support my decision whether to get in a trade or not, (when things could go either way), I don’t give them a lotta credit.
if my stoc says it’s overbought, no dragonfly doji would make me think otherwise.

I’ve decided to add yesterday’s trade, which is still up and running, as well.
in this one I left the Fibonacci on the chart so you could see how I use it.

unfortuantly, I was 1 pip short from take profit, but I hope it would get there eventually. again you can see that if I were near the computer in the right time (last time stocs hit buttom) I would have made a massive pip gain by using 2 lots, 1 with a trailing stop. oh well. next time.

Interesting system you’ve got there Parsush!

It’s so inspiring this section of the forum.

It feels like walking into an art gallery, so many different works, ideas, perceptions.

Just wonderful!

We are all going to be silly rich :smiley:

Good luck to you!

E. Lang

lol thanks Effi :slight_smile:
I totally agree. few more systems posted here and we’ll combine them all into one mega system and rule the world with it!
yours is also very good (if anyone hasn’t seen Effi’s art work, just look here)
and I’m saying so because of the good comments you got… unfortuantlly I haven’t tried it myself yet cuz I’m still busy working on mine.
I promise, however, that when I’m done, I’ll open a demo account dedicated to your sys and tell you what comes out.

Elang, I’ve completed setting up my charts using your 4 ema system. It looks promising. I am testing it now on gbp/usd,eur/usd,usd/jpy,usd/chf, and usd/cad on the 1H chart. Well see in the next few days. Are you trading this system live?

hey parsush, how about a review of your latest trades? how’s your system doing?

I was too busy counting my profits I forgot to post it :slight_smile:
last several trades have been very profitable… here goes:

in the USDCAD trade I used the second part of my system, relying on the MACD’s excellent accurecy in detecting hidden convergances.
in the other trades, I was using the good old first part, the stochs based part.

right now I have three active trades and two of them are not going too good, but I’ll soon upload them anyway for the sake of authenticity.

hello again!

alright. these are the 3 trades:


in this one 2 hours after I got in I noticed a crossover against me.
I had to close the trade losing only 2 pips on the spread…
on the daily chart, we can see that the major trend is actually bullish. I’ll wait for the big PPI reports today at 13:30 GMT to come out, and then we’ll see if the minor (1H) trend gets bullish again. if that is the case, we’re into some serious money-makin’ in the coming days.


This one is going pretty well. I got strong signals from both MACD and Stochs.
it almost hit my TP, but then the currency retraced back, and now it’s on the right direction again. hopefully by the time you read this I already hit the TP. I’ll keep you posted.


Here I got stopped within the hour, and as you can see the crossover came the next hour. again, on the daily chart, we can see that the major trend is bullish and that it might be up to the PPI reports today to tell if this pair is to continue going up.

it seems like you’re doing really good using that system of yours. can you sum up the amount of pips you earned each trading day?

nahh I’m too lazy :rolleyes: .
I’ll post the monthly sum at 1.10.07 for you all to see, and then see if the system needs any more adjustments or if it’s good to go.

right now I’m working on a potential adjustment - what should I do in cases such as this:

by the 1H chart it seems as if I got all the positive signs for a go.
(positive trend, oversold pair, positive crossovers and no conflict with the MACD)

on the daily chart, however, it seems like the currency hits the top of its ascending channel…

should I get in long?

  • I have. I decided to stick with the system. I’ll do the analyzing later, at the end of the month.
    went long at 156.00, SL at 155.76, TP at 156.35.
    this would give me accurate info because this pair is right now technical. next fundamental events are the
    All Industries Activity Index, and the Trade balance in Japan 9 hours from now (11:30PM GMT).
    these have a low impact on the JPY as well.

have I made the wise decision, altough we’re almost at the peak of the channel? time will tell.

It appears time has spoken:

things went exactly as planned - however I notice something, 3-4 hours before the TP was reached, stochs we’re at overbought.

in this trade, taken as well today, stochs showed overbought before TP2 was

luckily for me, I wasn’t around the computer to close the trades so they really did hit my TP points.

I suppose that these cases show me that an adjustment should be made, considering my exit rules. I should give more credit to Fibo and less to stochs, since the real money (TP2) only comes when they ARE overbough\sold against the trade. I suppose I’ll change the rules to just move to breakeven, and not shut down the trade entirely.

I must also add, that at first I lost the GBPUSD trade, when I entered it a bit too early, lost 40 pips (2 lots) and only an hour later, when i saw that the bears power was over I got in again and made around 85 pips.

Any comments or suggestions would be appreaciated.


ho hamor aravi sheli,
great charts parsush. it seems to me that your system makes good pips.
i have one question though.
you seem to enter with two diffrent TP points yet only one SL, i think you should consider using another SL. this can be useful in cases like your previous trade (you said you lost 2 lots with 40 pips because of wrong entrypoint/SL).
please care to reply.:smiley:

no problem my hairy bear,
infact, the explaination is rather simple.
by entering with 2 lots and setting SL on -20 pips each, I ALREADY EXCEEDED my limitation of 30 pips per trade. if my system allowed it, I would have set it to -40 or -50 each, and spare those percious pips, but I can’t do that since I’m counting on a good P\L ratio.

I already bent the rules a little bit, by setting the max loss to -40 pips (and paid for it costly).

this is why I usually use one SL.
when I see an “all go” sign from my indicators (MACD Stochs Trend and MAs are all in for the ride) I allow myself to increase risks a bit more, enter with 2 lots, and sometimes bend the max -30 pips rule to -35 or even -40, if it gets me behind a good support\resistance line.

Latest trade:

went long on EURCHF in 18:07 (GMT) at 1.6025.
SL at 1.6015, TP1 at 1.6045, TP2 at 1.6075.
(later on I changed SL to 1.6017… the minimum SL my broker allows is -10 pips, so I just set it when the price got a bit higher.)

Trade review:

it looked so promising at first, even the MACD gave me good signals.
yet my SL was triggered and I lost 8 pips on each lot.
that was quite disturbing… it did look like the perfect trade…

…and then I looked at the higher (H4) timeframe.

obviously I should have seen that. the ascending channel was broken just before I got into the position. if I saw that, I wouldn’t have executed the trade. now price might as well hit the 23.6%, or the 38.2% fibo support line, before continuing the uptrend.

well, this is how you learn :slight_smile:

lost 8 pips on each lot (total: -16 pips)


Good morning everyone!
I decided that this week, I’ll try to post the trades real time, or even an hour before opening a position, so you guys could catch up and make profits as well.

here’s this week’s first trade. just opened the postion, and if this one goes right we’ll have a good week.

I spotted an overbought at the GBPUSD, a nice bearish trend and even two crossovers to confirm. I also added the trendline to make sure it wasn’t approached like in previous trade, and noticed we’re at its top.
the unfortunate thing, was that when I was just about to execute my short order at around 1.9620, the pair dropped by around 18 pips to 1.9602.
If I woke up 20 seconds earlier, for example, this trade would have looked differently (probably 2 lots instead of one - and more probable to win)
but my entry price (1.9609) should be good enough to make it anyway.
so: Short at 1.9609 SL at 1.9646 TP at 1.9566.
if any of you get into this position at a better price\conditions, you’re more than welcome to use 2 lots. I can’t afford it because I’ve already exceeded my per-trade limitation.

good trading!


seems like previous trade (GBPUSD) just opened a time window…
right now price is at 1.9638 meaning if anyone wants in - time is now. you can also get in with 2 lots, TP2 would remain 1.9566 and TP1 would be defined using Fibo and you entry price (ratio)

regardless to that, there’s another trade (USDJPY) coming up soon and as I said, I’m giving you all the time to prepare yourself for it. should be triggered next hour (12:00-13:00 GMT).

in this USDJPY chart, we see the trend and we see the stochs.
if current candle closes below 0.20 value in stochs, that’s the signal. go long. aim for 118.91. SL depends on entry price, but if ratio allows it (1:1 or better), keep it lower than 118.50 (example: entered at 118.67).
that’s about it.


I just noticed USDCAD also follows the same criteria.

if after candle close stochs are lower than 0.20, and you manage to catch it at a relativly low price, set TP for 1.1584 for a humble profit. humble, but still a profit :slight_smile:
…just make sure P\L ratio is in your favor. otherwise - don’t trade.

Trade Review

got stopped at 1.9646. seems like the descending channel was approached.
at least I know the SL was positioned correctly. the minute the price rose above the channel and the MA100 (yellow) it was a lost case. too bad.
can’t win 'em all, I suppose :mad:

so it’s a -37 pips.