Straightforward Bands with Stochastic

EAcpu | 4 reads | 0 comments | 2026-05-02

One trade entry method I saw recently looked pretty good. It is presented on a 4-hour chart.

Here's the thing.

//| 1) Create two pairs of moving average indicators as follows:
//| a) 72 period high simple moving average
//| b) 72 period low simple moving average
//| c) 12-period high exponential moving average
//| d) 12-period exponential moving average of lows
//|
//|This sets up two bands or channels.
//|
//|When the 12-period moving average is at
//| 72 period range, we believe the trend is upward. when this
//|If the conditions are met, we will only conduct long transactions.
//|
//|When the 12-period moving average is at
//| 72 period range, we believe the trend is downward. when this
//|If the conditions are met, we will only conduct short transactions.
//|
//|We will not place a trade when any part of the two bands is at the same level
//|Touch or overlap.
//|
//|Trading entry signal is stochastic indicator
//| %K period is 14, %D period is 3, smooth value
//| of 3.
//|
//|For long trades we look for the %K value to cross above
//| The %D value after the %K value falls below 65.
//|
//|For a short trade we look for the %K line to cross below
//| %D value after the %K value rises above the 35 level.

I like this because it's simple. When I put these indicators on a chart, it looks clean and easy to follow.