Simple 4 Hour System | Forex Indicator Download - MT4/MT5 Resources
This is my first post here and I thought I'd start by sharing my system. It is very simple in approach and understanding.
set up:
100 Simple Moving Average Damiani Voltmeter
MACD - 15,26,9
4-hour chart-EUR/CHF
The 100 point Simple Moving Average acts as a support/resistance line and since it is known to be used by major banks and financial institutions, it is a self-fulfilling prophecy so to speak.
System rules
Long: Enter a long trade when the price closes above the 100 SMA and the MACD histogram is above the 0 line.
Short: Enter a short trade when the price closes below the 100 SMA and the MACD is below 0.
Re-Entry: When price retraces back to the 100 SMA once a long or short signal has been issued, re-enter the direction you first entered. It is recommended to trade the first 2 times the price hits the 100 SMA and stay on the sidelines thereafter.
Retracement entry: When the bar exceeds 100 points, wait for the retracement to the 100 SMA line and then enter the market. This will allow you to avoid unnecessary withdrawals.
Exit rules
Scaling: I personally hold 3 positions per trade. I set the first price target at 40, the second price target at 70, and let the third position run a stop loss at the breakeven point.
For example, once my trade reaches its first target, I move the second position to the breakeven point and leave the third position unchanged. When the second position is hit, I move the third position to the breakeven point to give the trade enough breathing room. I then look for the return price to add to the position (if it is open). Sometimes, when price goes back to the 100 SMA, I get stopped out at breakeven, resulting in a 100 pip gain on 2 positions.
This is a trend following system that has had its bad days. To avoid getting stuck in a range, I use a voltmeter indicator. This is by far the best indicator I have seen that helps detect range-bound moves in trending markets.
I will try to attach some snapshots of past transactions so that the whole idea becomes clear.
Comments appreciated.
Goodbye
set up:
100 Simple Moving Average Damiani Voltmeter
MACD - 15,26,9
4-hour chart-EUR/CHF
The 100 point Simple Moving Average acts as a support/resistance line and since it is known to be used by major banks and financial institutions, it is a self-fulfilling prophecy so to speak.
System rules
Long: Enter a long trade when the price closes above the 100 SMA and the MACD histogram is above the 0 line.
Short: Enter a short trade when the price closes below the 100 SMA and the MACD is below 0.
Re-Entry: When price retraces back to the 100 SMA once a long or short signal has been issued, re-enter the direction you first entered. It is recommended to trade the first 2 times the price hits the 100 SMA and stay on the sidelines thereafter.
Retracement entry: When the bar exceeds 100 points, wait for the retracement to the 100 SMA line and then enter the market. This will allow you to avoid unnecessary withdrawals.
Exit rules
Scaling: I personally hold 3 positions per trade. I set the first price target at 40, the second price target at 70, and let the third position run a stop loss at the breakeven point.
For example, once my trade reaches its first target, I move the second position to the breakeven point and leave the third position unchanged. When the second position is hit, I move the third position to the breakeven point to give the trade enough breathing room. I then look for the return price to add to the position (if it is open). Sometimes, when price goes back to the 100 SMA, I get stopped out at breakeven, resulting in a 100 pip gain on 2 positions.
This is a trend following system that has had its bad days. To avoid getting stuck in a range, I use a voltmeter indicator. This is by far the best indicator I have seen that helps detect range-bound moves in trending markets.
I will try to attach some snapshots of past transactions so that the whole idea becomes clear.
Comments appreciated.
Goodbye
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