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4 hour MA strategy

Discussion in 'Forex Trading Systems and Strategies' started by SXMTrader, Apr 24, 2009.

  1. SXMTrader

    SXMTrader Private

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    Hello Trader's,

    I started to trade 4 hours time frame on GBP/USD. I am using EMA 5,8,13,21,34,55,233 plus RSI 14 (over 50 bullish, under 50 bearish) and MACD 12,26,9. I also have the EMA crossover signal indicator which you find in the indicator folder on MT4.
    The ema crossover signal is set to EMA 5 and EMA 13. As soon I get a signal that the EMA 5 is crossing the EMA 13 I take my order. My question now is, can you help me to find the perfect SL, TP for this system? Right now I am looking for a opposite signal to close my order. I just started this system after looking back on my chart for some weeks and there are moves between 100-200 and up to 400-600 in one trading signal. Maybe somebody is trading the 4hour and can give me some help which we all can share.

    Thank's a lot,

    SXMTrader
     
  2. rnfuller102

    rnfuller102 Recruit

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    Hey sxm, go for it.

    I like the macd and rsi helpers. For profit targets you might try adding the daily pivot points showing support and resistance to 3 levels. Fib levels might also be helpful.

    But I would ask why all the clutter with the multiple EMAs if you are only watching out for the 5 over 13 crosses? You might keep the 34 or 55 just for trend verification. I just set up a chart with your parameters to see what it would look like. I've seen similar strategies using ONLY the 5 and 13 EMAs. However, do what works for you. If you find the extra EMAs useful, keep them.

    As for stops, it may depend on how volatile the market is at the time you enter your order: the choppier the market, the wider the stops.

    In my opinion, I don't think there is a so-called "perfect" SL and TP, and I think you may know that too. We watch our charts to get a feel for the market at the time and we do our best to peg entries and exits. The SL and TP you use in today's trades may not work next week or all month long, and, of course, that's why you are asking for suggestions. Hence demo trading over time to gain experience.

    If you don't already, you might want to keep a trading journal notebook, or take screen shots of each entry and make notes of what's going on in the market to keep track of your progress. You may find that invaluable to look back on down the road.

    Just my two cents for what its worth... Others with more experience may suggest something better.

    Keep us posted on your progress, please. I'm interested.

    Thanks,
    Raymond
     
    #2 rnfuller102, Apr 25, 2009
    Last edited: Apr 25, 2009
  3. SXMTrader

    SXMTrader Private

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    Hello Raymond,

    Thank you very much for you reply. It is always very helpful to here other's opinion. You are right, less MA will also show the strengh of the trend and gives in general a more clear picture. Thank's again.

    Holger
     
  4. SXMTrader

    SXMTrader Private

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    Hello Raymond,

    I have another post: 'Average Moving Average Alarm' under Forex Trading Systems and Strategies, which can help to stay away from some false signals in flat markets. I found this indicator late yesterday and was sitting for hours to check it on 1 and 4 hour time frame with some other indicators. Maybe you like to have a look at this too. It will be great to get your opinion about it. It will give similar signals, but less false signals.

    Holger
     
    #4 SXMTrader, Apr 25, 2009
    Last edited: Apr 25, 2009
  5. wail

    wail Recruit

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    how are you SXMTRADER?
    i was wondering, how good did this strategy work for you for the last 2 years ? and what pairs did it work the most?
     

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