Forex Dragon Trend Following Strategy
Forex Dragon Trend Following Strategy:
The nature of forex is that it has a lot of noise especially in lower
timeframes. As such, it’s difficult to trade off any timeframes less than
15 minutes. I recommend using the Profitable Trend Forex System in
1-hour, 4-hour, and Daily timeframes.
If you use this system to trade indices such as S&P, you may use
shorter timeframes: 5-minute, 15-minute.
3. Currency pairs
Currency pairs that have a large daily range are more suited for this
system: GBP/USD, USD/CHF, EUR/JPY, GBP/JPY.
In the picture belowProfitable Forex Trading System in action.
When a trend is established (based on our criteria), we look for the
first small retracement (L1 signal) and the first larger retracement (L2
signal). We always take the first L1 signal and the first L2 signal.
However, when price retraces the second time and gives us the second
L1 or L2 signal, we must be cautious. We need to determine if the
trend still has enough momentum to resume its original direction.
In our system we use MACD (3,10,16) as momentum indicator. We
call it short MACD indicator.
When an uptrend makes new highs in price and in momentum
indicator (new high in short MACD indicator), it still has momentum to go up.
When a downtrend makes new lows in price and in momentum
indicator (new low in short MACD indicator), it still has momentum to go down.
Therefore, the second L1 signal is valid as long as the previous L1
signal was successful and resulted in the trend making new high/low in
both price and momentum. Likewise, the second L2 signal is valid as
long as the previous L2 signal was successful and resulted in the trend
making new high/low in both price and momentum.
This method of momentum determination is important. It helps us
filter a lot of false signal.
The following chart illustrates this rule. We observe that the downtrend
is making lower low in both price and momentum after a successful L2
signal. Thus the second L2 signal is valid.
In attach also basic version.
In forex a trading strategy is a fixed plan that is designed to achieve a profitable return by going long or short in markets. The main reasons that a properly researched trading strategy helps are its verifiability, quantifiability, consistency, and objectivity.
For every trading strategy one needs to define assets to trade, entry/exit points and money management rules.
How to install Forex Dragon Trend Following Strategy?
- Download Forex Dragon Trend Following Strategy.zip
- Copy mq4 and ex4 files to your Metatrader Directory / experts / indicators /
- Copy tpl file (Template) to your Metatrader Directory / templates /
- Start or restart your Metatrader Client
- Select Chart and Timeframe where you want to test your forex strategy
- Load indicator on your chart
How to uninstall Forex Dragon Trend Following Strategy?
To shut down an indicator, one has to remove it from the chart. At that, its drawing and recalculation of its values will stop. To remove an indicator from the chart, one has to execute its context menu commands of “Delete Indicator” or “Delete Indicator Window”, or the chart context menu command of “Indicators List – Delete”.