{"id":9947,"date":"2022-10-14T06:50:54","date_gmt":"2022-10-14T06:50:54","guid":{"rendered":"https:\/\/mdr.foobrdigital.com\/?p=9947"},"modified":"2022-10-14T06:50:54","modified_gmt":"2022-10-14T06:50:54","slug":"so-easy-its-ridiculous-trading-system","status":"publish","type":"post","link":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/2022\/10\/14\/so-easy-its-ridiculous-trading-system\/","title":{"rendered":"\u201cSo Easy It\u2019s Ridiculous\u201d Trading System"},"content":{"rendered":"\n

As you can see, we have all the components of a good forex trading system.<\/p>\n\n\n\n

First, we\u2019ve decided that this is a\u00a0swing trading\u00a0system and that we will trade on a\u00a0daily chart<\/strong>.<\/p>\n\n\n\n

Next, we use\u00a0simple moving averages\u00a0to help us\u00a0identify a new trend<\/strong>\u00a0as early as possible.<\/p>\n\n\n\n

The\u00a0Stochastic\u00a0helps us determine if it\u2019s still ok for us to enter a trade after a\u00a0moving average crossover<\/strong>, and it also helps us\u00a0avoid oversold and overbought areas<\/strong>.<\/p>\n\n\n\n

The RSI<\/a> is an extra confirmation tool<\/strong> that helps us determine the strength of our trend.<\/p>\n\n\n\n

After figuring out our trade setup, we then determined our risk<\/strong> for each trade.<\/p>\n\n\n\n

For this system, we are willing to risk 100 pips on each trade<\/strong>.<\/p>\n\n\n\n

Usually, the higher the time frame, the more pips you should be willing to risk because your gains will typically be larger than if you were to trade on a smaller time frame.<\/p>\n\n\n\n

Next, we clearly define our entry and exit rules.<\/strong><\/p>\n\n\n\n

At this point, we would begin the testing<\/strong> phase by starting with manual backtests.<\/p>\n\n\n\n

Trade Example: Buy EUR\/USD<\/h2>\n\n\n\n

Here\u2019s an example of a long trade setup:<\/p>\n\n\n\n

\"Long<\/a><\/figure>\n\n\n\n

If we went back in time and looked at this chart, we would see that according to our system rules, this would be a good time to go long.<\/p>\n\n\n\n

To backtest, you would write down at what price you would\u2019ve entered, your stop loss, and your exit strategy.<\/p>\n\n\n\n

Then you would move the chart one candle at a time to see how the trade unfolds.<\/p>\n\n\n\n

\"Long<\/a><\/figure>\n\n\n\n

In this particular case, you would\u2019ve made some decent pips! You could\u2019ve bought yourself something nice after this trade!<\/p>\n\n\n\n

You can see that when the moving averages cross in the opposite direction, it was a good time for us to exit.<\/p>\n\n\n\n

Of course, not all your trades will look this sexy. Some will look like ugly heifers, but you should always remember to stay disciplined and stick to your trading system rules.<\/p>\n\n\n\n

Trade Example: Sell EUR\/USD<\/h2>\n\n\n\n

Here\u2019s an example of a short entry order for the \u201cSo Easy It\u2019s Ridiculous\u201d system.<\/p>\n\n\n\n

\"So<\/a><\/figure>\n\n\n\n

We can see that our criteria are met, as there was a\u00a0moving average crossover, the\u00a0Stochastic\u00a0was showing downward momentum and not yet in oversold territory, and\u00a0RSI\u00a0was less than 50.<\/p>\n\n\n\n

At this point, we would enter short.<\/strong><\/p>\n\n\n\n

Now we would record our entry price, our stop loss, and exit strategy, and then move the chart forward one candle at a time to see what happens.<\/p>\n\n\n\n

\"So<\/a><\/figure>\n\n\n\n

Boo yeah baby! As it turns out, the trend was pretty strong and the pair dropped almost 800 pips<\/strong> before another crossover was made!<\/p>\n\n\n\n

Now isn\u2019t that ridiculously easy?<\/p>\n\n\n\n

\"The<\/figure>\n\n\n\n

We know you\u2019re probably thinking that this system is too simple to be profitable. Well, the truth is that it is simple. You shouldn\u2019t be scared of something that\u2019s simple.<\/p>\n\n\n\n

In fact, there is an acronym that you will often see in the trading world called KISS.<\/p>\n\n\n\n

It stands for Keep It Simple Stupid<\/strong>!<\/p>\n\n\n\n

It basically means that forex trading systems don\u2019t have to be complicated.<\/p>\n\n\n\n

You don\u2019t have to have a zillion indicators on your chart. In fact, keeping it simple will give you less of a headache.<\/p>\n\n\n\n

The most important thing is discipline<\/strong>. We can\u2019t stress it enough. Well, yes we can.<\/p>\n\n\n\n

YOU MUST ALWAYS STICK TO YOUR TRADING SYSTEM RULES!<\/strong><\/p>\n\n\n\n

If you have tested your forex system thoroughly through backtesting and by trading it live on a DEMO account for at least a month (or two).<\/p>\n\n\n\n

Then you should feel confident enough to know that as long as you follow your rules, you will end up profitable in the long run.<\/p>\n\n\n\n

Trust your system and trust yourself!<\/strong><\/p>\n\n\n\n

If you want to see some examples of some slightly more complicated forex trading systems, take a look at Huck\u2019s\u00a0HLHB system\u00a0or Pip Surfer\u2019s\u00a0Cowabunga system.<\/p>\n","protected":false},"excerpt":{"rendered":"

As you can see, we have all the components of a good forex trading system. First, we\u2019ve decided that this is a\u00a0swing trading\u00a0system and that we will trade on a\u00a0daily chart. Next, we use\u00a0simple moving averages\u00a0to help us\u00a0identify a new trend\u00a0as early as possible. The\u00a0Stochastic\u00a0helps us determine if it\u2019s still ok for us to enter […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[831],"tags":[],"_links":{"self":[{"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/posts\/9947"}],"collection":[{"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/comments?post=9947"}],"version-history":[{"count":0,"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/posts\/9947\/revisions"}],"wp:attachment":[{"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/media?parent=9947"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/categories?post=9947"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/tags?post=9947"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}