What do you think is wrong with this system
🟢The 1st thought would be too many indicators, you are right to some degree.
🟢But the major issue is all the indicators are momentum indicator
🟢They all represent the same parameter
hence not directly adding value.
Mistakes to avoid while creating your system
1⃣ Don't use indicators that represent the same parameters
2⃣ Try to keep the system simple
3⃣ Create a system that can define entry, stop loss, and exit as clearly as possible. or at least help you to gauge the market correctly
There are only 3⃣ categories of indicator
1⃣ Trend indicator
2⃣ Momentum indicator
3⃣ Volatility indicator
🟢This also means you hardly ever need to use more than three indicator
🟢This also means you can use the free version of #TradingView effectively 😋
🌟Trend is your friend.
Trading in the direction of the trend puts the winning probability more in your favor.
Following are the famously used trend indicator
🟢Moving average
🟢Super Trend
🟢Parabolic SAR
🌟Catch the Momentum
Without momentum, Trend will be a boring friend 😆
As a trader, your goal is to make big money as quick as possible.
Following are the famous momentum indicator
🟢RSI (favorite for many)
🟢STOCHASTICS
🌟Let there be some Volatility
Without much volatility in the market the opportunity to make money will be very less.
Famous indicator to gauge volatility
🟢ADX
🟢ATR
🟢BOLLINGER BANDS
Combining them to create a system
1⃣ Price in an uptrend
2⃣ Volatility is decent i.e above 20
3⃣ Momentum increasing
It doesn't have to be perfect
🟢You can also create the system by using two indicators or no indicators at all.
🟢The idea is to have some rules/parameters that can help you to gauge the market correctly.
🟢System will fail from time to time hence have good risk management.
I hope this will improve your trading and help you to become a better trader.
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The following Things are used in this strategy
1⃣ Triple RSI indicator - to filter
2⃣ 50 EMA - to identify the trend and dynamic support/resistance
3⃣ ADX - to identify the strength behind the trend
4⃣ Time frame to be used is 15 min
How to use triple RSI in strategy
1⃣ On #TradingView apply triple RSI indicator
2⃣ +ve signal if redline crossing up
3⃣ Bullish trades only when all the lines above 50
4⃣ Trade to be initiated by using support
1⃣How much time you can dedicate to markets.
- if you have a day job that requires lots of your attention then it's better to use a daily or weekly time frame.
- This removes the burden of making constant decisions
- Gives you ample time to plan and think about your trade.
2⃣ Your current skill level
- As a beginner, it's better to start with a higher time frame such as 15 min, daily, or weekly.
- This gives your ample time to process different data points.
- Reduce burden of making a frequent decision
- Forces you to look at the larger picture
Swing trading strategy based on the use of ⭕️Stochastic Oscillator⭕️
🧵Things you'll learn
- How stochastic value is calculated
- How to use the indicator
- Swing Trading entry exit rules. #StockMarket#Trading#Investing
What is a Stochastic Oscillator 🤔
- It's a momentum indicator.
- Developed by George C. Lane in the late 1950s.
- It shows the location of the close relative to the high-low range over a set number of periods
How is it calculated?
🟢%K = (Current Close - Lowest Low)/(Highest High - Lowest Low) * 100
i🟢f you use the values in the below image you'll get a Stochastic value close to 50.54
🟢5 min time frame on the spot chart
🟢Heikin Ashi chart
🟢20 SMA
🟢MACD indicator default settings
⏹️⏹️⏹️⏹️⏹️⏹️⏹️⏹️⏹️⏹️⏹️
⭕️You can either trade with this signal in futures
⭕️Or use ATM call/put option depending on signal
2⃣ Types of Heikin Ashi candles you should know
🟢Candle with no lower wick = bullish
🟢Candle with no higher wick = bearish
🟢Candle with lower and higher wick = Indecisive