FollowTheLeader System | Foreign exchange indicator download - MT4/MT5 resources

Who wants to test the FTL system?

The rules are very simple and best of all, no indicators are needed - just candlesticks! Designed for newbies and Forex fools like me.

Timeframe - Daily (but H4, H1 seem to work too)
Currency - GBPUSD (applies to everyone I guess)

When to buy or sell?
At the beginning of the day, just check the previous candle. If positive, buy, if negative, sell

TP - let it continue running until SL is met

SL - buy if the candle reverses and reaches the day's close; or if the current candle closes lower (next candle we open a sell position)
SL - when selling, if the candle reverses and reaches the close of the day, or the current candle closes higher (next candle we open buy)

Always trade in the direction of the last candle. Therefore, if the stop loss line is hit for the day, but it comes back and goes in the direction of the previous candle, we will open a new position again. But if it is a reversal, we will not open a new position.

I think this can be best explained by using some actual candlesticks, GBP USD, daily time frames

http://img17.imageshack.us/img17/593/gudaily.jpg

January 2 OHLC -
1.4565 1.4576 1.4377 1.4546

January 5 OHLC
1.4546 1.4738 1.4433 1.4699

January 6 OHLC
1.4698 1.4992 1.4503 1.4916

Note the candle of January 2nd, it is a bear candle. Therefore, we open a sell trade on January 5th at the opening price of January 2nd (1.4565), with a stop loss. It opened at 1.4546 on January 5, reversed upward, and hit stop loss. -19 points + 3 points difference, a net loss of 22 points on the day. We do not open a buy position for the day because the previous candle was bearish.

Day 1 On the second day, we bought (based on the bull candle of January 5th) with the stop loss at the open of January 5th (1.4546) and it fell again to a low of 1.4503, thereby hitting our stop loss and losing 153. But lo and behold, it rose again and surpassed the previous day's closing price. Since we are in a buying trend, we open a new position . Therefore closing the trade at +218, the net profit is +59 points today. If the trend is the same, we will only open the second trade of the day.

January 7 (#4) – The hands-down winner to buy. +175 points
January 8th - Another buy winner +118 points

January 9th (#5) - The candle closed lower, so we close the trade with

So far we have +276 points.

If we continue, we will have 2 profitable sell days, +244, +319. Let's say we close the trade at the end of each day. That's why we calculate a 3 pip spread. Then there was a loss of -115pips on day 3 on January 14th.

The total net gain was +724 points. For a "no-brainer" person, just following the leader trade would be great, right?

The results for January are as follows: Net income +1407 points

2009.01.02
2009.01.05
2009.01.06 59
2009.01.07 175
2009.01.08 118
2009.01.09
2009.01.12 244
2009.01.13 319
2009.01.14
2009.01.15
2009.01.16 96
2009.01.19
2009.01.20 493
2009.01.21
2009.01.22
2009.01.23 73
2009.01.26
2009.01.27 134
2009.01.28 114
2009.01.29
2009.01.30 178

For the first 7 months of this year, from January 2nd to July 31st, the net gain was +3132 points , if my calculations are correct. Maybe someone knows how to write an EA so we can backtest/forward it? I just calculated them manually using an Excel sheet.

This is an EA provided by Ronald Raygun - http://www.forexfactory.com/showpost...8&postcount=24