This strategy is thanks to Baby Pips to their good information/school, ForexPhantom and the Daily Crossover System, the Cowabunga System, the Cat and Mouse System and the many threads and posts I have been reading.
This is a very simple system, so I will do my best to explain it simply.
_Daily Chart. ( I have not tried this on any other TimeFrame)
_EMA 1 (exponential moving average)
_EMA 4
(like the Daily Crossover System without the use of the MACD)
Those are the only settings I use.
I trade all currency pairs. (currently 19 pairs) However I have never had more than 7 signals in one night.
Trade Entry: I enter trades at 9:00pm pacific coast time or just before or just after, but as close to the close of the Daily candle as possible.
You are looking for a cross of the EMA’s in the previous day’s candle. So if it is 8:55pm you are looking for a cross in that day’s candle. If it is 9:05pm then it is a cross in the previous day’s candle.
_Sell if the EMA1 crosses the EMA4 from above. The lines are going down.
_Buy if the EMA1 crosses the EMA4 from below. The lines are going up.
(If you have to convince yourself there is a cross or wish your screen could zoom in 10000000x to see if the lines crossed, move on to the next currency pair, don’t trade it. Don’t worry, a year is a long time and there will be lots of trades out there.)
SL:100
TP:100
Like the Complete Cat and Mouse System I am always trying to compound my gains (and inevitably my losses). Meaning that I will type in my current balance into the number of units to trade for that given day.
Example: Day 1: Balance:$1000.00 Units: 1000
Day 2: Balance: $1002.00 Units: 1002
This way 100pips is always either -1% or +1%. I like easy math.
I then close the computer for the night.
Trade Exits: Hopefully during the night every single trade (I will open as many positions as their are signals) have reached their TP, (as if I could ever be so lucky). Or the SL have been triggered.
I open the computer at 8:00am pst the next morning. Why then, because that is when I eat breakfast.
If a trade is still open and in profit, I sell half the position, move the SL to +1 (there is no better feeling than being in a free trade, even if it retraces the entire way).
If a trade is still open and negative I sell the entire position.
Start again that night at 9:00pm. I trade Sun-Thurs night and do not hold positions over the weekend.
Oh and if you see on you calendar of events the words: Federal Reserve or Interest Rate comment/decision/mumbling/, just take the night off but don’t lose the opportunity and just switch to a demo account and see what it is like.
And that is it.
In this last month I was up 21%. However there was more trending than usual and with any crossover system a trending market means money.
The expectancy for the system is about 10%/month, which is 1000pips. (back tested over one year, take my back testing with a grain of sand/sand that sleepy stuff in the corner of you eye and do it yourself.)
I have not traded currencies before but have traded stocks (full time and with a full time job) since 2005 and yes, I have lost my entire account twice.
My only two cents is don’t demo trade for forever, use real money as soon as possible. Just take $100 dollars and lose it all a couple of times. Get used to seeing a negative position when you open your computer. It will take a while for some people, like myself, to learn to control yourself when you see that red number on the screen. Remember losing $1.00 on a balance of $100 is the same as losing $10,000 on a million. You just have to get your body used to it.
Thanks! Would like to hear any positive criticism/critique/tweek!