The Ichimoku Dow and S&P System
As the title suggests, I want to share with you a very simple ichimoku system that I have been using to trade the Dow (US30) and S&P 500 (US500) with great success. After trying footprint charts, price ladders, volume profiles, various breakout systems, etc. to find success with the index, I finally settled on this extremely simple strategy using the simplest of indicators with great success.
The rules are very simple. Once the HA candle closes above the ichimoku span and above the MA, buy, once the HA candle closes below the ichimoku span and below the MA, sell.
I only use it on the M5 time frame.
stop loss
US30 - between 30 and 50 pips depending on volatility (40 is usually the sweet spot)
US500 - between 2 and 4 pips depending on volatility (3 pips is the sweet spot)
To take profits you can use a fixed target of 2RR (Risk Reward Ratio) but I personally just move my SL to BE after reaching 1RR and let my winners run until the move is exhausted. The Heiken ashi candle variation is also a great exit system.
index
Ichimoku is at 12, 29, 52, but only span A and span B. We don't need the other 3 parts
50 moving average
The Heiken Ashi Smoothed Supply and Demand Indicator shows the day's and week's highs and lows, as well as previous turning points.
Some things to note
1. The Dow can be extremely volatile at the cash open (9:30 a.m. New York time) and there is often stop hunting (also known as weeding out weak longs), so I tend to give it a few minutes to settle before getting involved. Thankfully, the big brother, the SP500, is generally much calmer.
2. Always have two charts open at the same time. This will save you from exiting the winner prematurely.
3. It also works with Dax, but I haven't fully backtested it yet. I will upload the results once completed
4. As with all trading systems, keep an eye out for fluctuations on major news days such as NFP and FOMC.
5. Since the Forex market is fundamentally different from the world of indices and stocks, I strongly recommend that you learn the mechanics of supply and demand in order to successfully use this system on currencies.
Backtest and let us share these charts. Glad you're joining us.
The rules are very simple. Once the HA candle closes above the ichimoku span and above the MA, buy, once the HA candle closes below the ichimoku span and below the MA, sell.
I only use it on the M5 time frame.
stop loss
US30 - between 30 and 50 pips depending on volatility (40 is usually the sweet spot)
US500 - between 2 and 4 pips depending on volatility (3 pips is the sweet spot)
To take profits you can use a fixed target of 2RR (Risk Reward Ratio) but I personally just move my SL to BE after reaching 1RR and let my winners run until the move is exhausted. The Heiken ashi candle variation is also a great exit system.
index
Ichimoku is at 12, 29, 52, but only span A and span B. We don't need the other 3 parts
50 moving average
The Heiken Ashi Smoothed Supply and Demand Indicator shows the day's and week's highs and lows, as well as previous turning points.
Some things to note
1. The Dow can be extremely volatile at the cash open (9:30 a.m. New York time) and there is often stop hunting (also known as weeding out weak longs), so I tend to give it a few minutes to settle before getting involved. Thankfully, the big brother, the SP500, is generally much calmer.
2. Always have two charts open at the same time. This will save you from exiting the winner prematurely.
3. It also works with Dax, but I haven't fully backtested it yet. I will upload the results once completed
4. As with all trading systems, keep an eye out for fluctuations on major news days such as NFP and FOMC.
5. Since the Forex market is fundamentally different from the world of indices and stocks, I strongly recommend that you learn the mechanics of supply and demand in order to successfully use this system on currencies.
Backtest and let us share these charts. Glad you're joining us.
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