I am a new trader and poster on the forum. I have just finished the school of pipsology which I thought was great and amazingly structured. I have since then attempted to develop a strategy to suit my style. I want to execute day trades on the com dollar pairs as well as commodoties if a certain set of conditions (4) have been met. My strategy is as follows;
Read All Daily news reports; do not trade on days of large news events
Apply following indicators on 4 hour and 15 min chart
Evaluate 4 hour trend for current trend
Use 15 minute chart to determine entry and exits points
1.Apply 5 EMA to chart
Apply 10 EMA to chart
When 5 EMA crosses below 10 EMA then Sell.
When 5 EMA crosses above 10 EMA then Buy.
2.Apply RSI (9) to confirm Trend
-Sell signal when <50.
-Buy signal when >50.
3.Apply Stochastic (10,3,3) for Overbought vs Oversold.
Sell signal when overbought.
Buy signal when oversold.
Apply ADX: Average directional index
20-25: Current price action is running out of steam = Trend Reversal Confirmation
What do you think of the strategy? I would greatly appreciate your input and feedback.
i think you should trial it on demo for 3 months minimum and see what the results are.
simple as that
I do know what you are asking… You are asking us to Critique your Strategy.
it doesn’t work like that, because we all trade differently
JUST TEST IT.
be cool
There is some potential in what you are proposing although I suspect there are some problems too! Maybe the least of which is how much time you will be screen watching while you wait for the 15m MAs to cross.
I think there are some strong similarities to this method “HLHB Forex Trend-Catcher System” which is a BP blog by Hucklekiwi Pip, which you might like to take a look at here…
I think your main problems will be whipsaws during non-trending periods in the 15min TF even though you have some filters with the 4H direction and RSI.
I am not clear from your description how your exit strategy works. If you are intending exiting on reversal signals from the 15m TF then you may find that the price will retrace too much before your crossover gets you out. Your indicators are quite predominantly cyclical and whilst this may be beneficial on entries, it can lag terribly when the price suddenly collapses in the other direction.