Extreme TMA System
Trading strategy Extreme TMA System suitable for all currency pairs, the recommended timeframe M15.
Market resembles a pendulum, constantly swinging first one way, then the other. He always strive to create a high price, but never reach this success, constantly reaching this level, turning, trying to reach him again and never reaching balance. This system is designed to use the pendulum swings. It is a compendium of my understanding of the market in the most simple terms.
Principles of the system are simple. The first indicator - is smoothed TMAWhich shows us the middle path, which should be the price. The indicator reflects the past price movement, through which we are trying to determine the future based on recent history. He corrected by repainting. The indicator consists of two outer boundaries of price movement.
Our second indicator - is TMA Slope. He shows us the relative change in the slope of the center line from previous candles. Indicator determines the direction of our potential transaction, also in it to keep track of divergence with the price. For example, if the price increases, and our indicator drops, it is very likely to predict a price reduction in the near future. The stronger decline in the indicator, the greater the risk of falling prices. The same concept, we can deploy. If the price falls, and the indicator is growing - it is likely that the price will go up. In addition, we will use this indicator in the output, as described in detail below.
The third and final indicator - is histogram MA Crossover Histogram, Which is a visual guide that helps us to analyze the direction of price movement. The blue bars indicate a bullish price behavior, red - on a bearish price behavior.
1) We first determine the trend by TMA Slope indicator. If the TMA is in the range-0.50 0.50 before we can open the transaction in either direction. TMA value is bullish above 0.51. In this case, we only long positions. Bearish value TMA (below-0.51). In this case, we only short positions.
2) Once we have determined the direction of the transaction, we look at the TMA and wait for the price to cross one of the two outer limits of the range. The upper limit for a short order, the lower orders for long. As a rule, the price moves within range, so these transactions relatively reliable.
3) Now we look only at the TMA Slope Indicator. We open only long positions if the indicator values are rising, and only short positions when they are down. The greater the angle of fall or rise, the stronger the signal.
4) Finally, we only disclose short positions when the price is above the upper limit of TMA and testing the resistance level which is above the upper limit of TMA. We open only long positions if the price is below the lower limit of TMA and is testing the support level, which is below the lower bound TMA. The further away from the borders of the price range, the stronger the signal.
There are two ways to open a position in the trading strategy Extreme TMA System, Depending on your tolerance for risk:
1) No hard stop-loss. If you do not use tight stop-loss (30 pips to the entry level or less) after 4 conditions described above, place the order, after the price has touched the (test) at least once a support / resistance level.
2) With strict stop loss. If you use a tight stop-loss (30 pips to the entry level or less), then you need to apply to the chart right EA from in papke.Experts. 5 x 5 Buy EA is designed for long transactions. 5 x 5 Sell EA for short trades. Please note that the use of the EA will reduce your profit a few pips, but your risk is lower.
5 x 5 EA will result in the execution of a warrant when the conversion price on the smoothed 5 periods and shifted to 5 period moving average (white line on the graph). When EA automatically results in the execution of the order, it automatically shuts off. That is, you get only one time and in one direction. After EA stopped working, you will see a notification at the top left of the screen, you can remove it from the chart and move to an exit strategy.
Very conservative yield. Close the position when the RA touched the center line TMA.
Conservative. Close the ½ position when RA touched the center line. The second half of the position we close when price touches the opposite one TMA, or when TMA Slope closes formed in the opposite direction of the trend of our bar.
Aggressive. When RA touched the opposite one range or when TMA Slope indicator closes formed in the opposite direction of the trend of our bar, use a trailing stop above the high of the previous candle for a short position, and under the previous candle to go long. We work with a trailing stop until the position is stopped.