Find the reasons how backtesting became the only reasonable way to trade smart.
Intrigued? Keep reading and learn more.
What does make the difference between a lucky guess and a profound trading? Are you sure, your trading style is more than just flipping a coin and expecting the positive outcome?
Or probably you are overwhelmed by the quantity of the trading strategies on the Internet promising to bring a fortune? Want to know how to avoid a desperate confusion when the “simple” strategies only drain your live trading account? (read more).
We are back again to RSI, but accompanied with the Moving Averages this time.
Our choices are the strategies easy to understand for the beginner traders, but at the same time attractive for the more advanced ones.
We believe this trading strategy is one those, but only backtesting can reveal all strong and weak sides of the strategy (read more).
As we loved Awesome Oscillator in action, we proposed another trading strategy using this indicator, but accompanied with the RSI indicator this time. Let us check how powerful these two can be together and either such combo of the indicators will make our trading decisions more precise.
The combination of these two popular indicators believed to make the strategy applicable almost for any trader – it is simple to understand even for the beginners (read more).
As we loved Awesome Oscillator in action, we proposed another trading strategy using this indicator, but accompanied with the RSI indicator this time. Let us check how powerful these two can be together and either such combo of the indicators will make our trading decisions more precise (read more).
Till now we have tried various indicators in pairs and combinations.
However, can the indicator stand alone and still be enough for the prediction of the next movements of the market? This time we put Stochastic Indicator all alone to the test. Read further and learn how it turned to be – profitable or not.
It should be one of the simplest strategies ever, but can it leave the trader with profits? (read more).
We have tested a line of the well-known indicators and now it is time to try the Parabolic SAR indicator.
As it is better to use the combination of the indicators for signals confirmation, we compliment the Parabolic SAR with the Moving Averages (read more).
Confused by the tones of the trading strategies flooded the Internet? Tired of believing another ‘trading guru’ about the next ‘the most profitable trading strategy ever’?
We have backtested popular trading strategies so you wouldn't have to! Save your time and enjoy the reading!
We’d love to start with the indicator that gained love and respect of the millions of traders – MACD Indicator (read more).
While determining the direction of the trend and points of change is essential for entering the market, one of the bigger challenges facing the trader is to find out when the sentiment has changed.
When it comes to determining the earliest reversal of trend direction, one should look at using Renko charts (read more).
According to Williams, Awesome Oscillator, evaluating dynamics of the price movement − the most effective element in his trade system Profitunity.
Even if you not the fanatic of the wave market theory, it will be very useful to see accurately wave pieces in the market to enter the market after the termination of an old wave in an optimum point of the new (read more).
We offer classical option for sure trade.
The Alligator indicator uses the idea of the moving average and the theory of fractals in the original interpretation of Bill Williams.
The author's description in books «Trading Chaos: Maximize Profits with Proven Technical Techniques» and «New Trading Dimensions…» in general coincides with the mechanism of the modern tool (read more).
The science of chaos means much more than a just new trading approach.
It is an entirely different way of viewing the market, that until the mid-1980s, we didn’t have the computing power needed to deal with on a mathematical basis.
Applying rigorous mathematical thinking to complex forms, chaos theory is the first technique that successfully models turbulent price flows (read more).
In trading, a moving average is defined as a product of adding up the prices for a given interval and then dividing the sum by that interval. Simple moving averages are effective for the analysis of trend and used extensively in algorithmic trading systems.
They are also appropriate for determining the support and resistance levels.
One can use a single moving average or combine a few different ones to plot on their charts (read more).
It is necessary to clearly understand who is currently stronger: «bulls» that provide a price increase, or «bears», pushing the price down.
The right choice of «colleagues on a trend» considerably increases chances of success (read more).
In a pursuit of profit, we often do not notice the standard tools capable to simplify the routine engineering analysis without loss of quality of signals.
We offer dynamic trend Moving Average of Oscillator (OSMA). The indicator evaluates a difference between the value and its smoothing, and on the basis of it draws conclusion about force of the current tendency (read more).
Article on RVI appeared in the S&C magazine in January 2002, and the credibility was provided by the author John Ehlers − the best expert in the use of cycles in technical analysis.
An Indicator of the «confidence» about the trend continuing has long proved to be effective (read more).
Though the WPR indicator (Williams%R or Williams Overbought/Oversold Index) bears a name of famous Larry Williams, this author is George Lane − the developer of the classical Stochastic oscillator. For the first time the indicator is mentioned in the book «How I made one million dollars last year trading commodities» , where its anticipated signals of a turn are actively advertised (promoted) (read more).
One more element of the well-known Theory of Trade Chaos analyzes how attractive the asset is to financial market participants. Except for dynamics of the price, the MFI indicator, in addition, considers market volume that, according to Bill M.Williams, allows you to see how fast money «enters and leaves the market» (read more).
The revolutionary idea of Bill M.Williams reveals that trade volume is the main driver of the price’s movement. The correct analysis of the «relations» volume/price gives a clear understanding where (and how attentive!) the market is «watching» at the moment. And the MFI indicator, together with other developments of the author, has to be one more assistant to the trader in fight for profit (read more).
The MACD indicator is a variation of the moving average crossover and represents a smoothed difference between two exponential moving averages.
The moving average convergence-divergence is one of the most potent technical tools in trader’s arsenal.
It is also one of the simplest and extremely versatile, as it can be used both to trade trend and the range.
The moving average convergence-divergence indicator is based on the insight that more can be learned about price behavior from the interaction between moving averages than from the moving averages themselves (read more).
The first mentioning of CCI or index of the commodity channel appeared in October 1980, when Donald R. Lambert published analytical article in the journal Commodities.
The author successfully worked in commodity markets, experimented with the analysis of volatility and developed the Сommodity Сhannel Index almost by accident − to test the hypothesis of a cyclical price. Today this indicator has become an indispensable element in the arsenal of any active trader (read more).
Financial journalist Dan Valcu on his website says that in the summer of 2003, when studying the methodology of Ichimoku Kinko Hyo, he accidentally discovered diagrams with an unusual trend picture developed by an unknown stock trader.
Attempts to adapt this method to Japanese candles turned out to be so profitable that the program code of the indicator Heiken Ashi was developed prior to the presentation in the press (read more).
Hybrid indicator Traders Dynamic Index, the algorithm of which was created by the usual trader Dan Malone, performs a full-fledged market analysis: in addition to the direction and strength of the trend, it allows you to effectively assess volatility.
Despite the fact that the author's strategy of Trading Made Simple was scalping (on M5-M15), practice proves that the indicator’s signals are effective on any timeframe and trading asset (read more).
In the global trading system of Trade Chaos Williams, Gator Oscillator plays the role of an additional filter of the “sleep” and “hunt” periods for the Alligator, so it is usually used in conjunction with its “big brother”.
Because of the unconventional interpretation, this oscillator can cause misunderstanding among beginners, but the benefit from its application becomes more obvious with some trading experience (read more).
The popular book of the successful analyst and trader Thomas R. DeMark «The New Science of Technical Analysis» was carefully read by few. But practice proves: those who have not regretted the time to study his theory, will always be in profit.
The author created his own technical tools even before the era of the computer revolution − at that time analysts performed most of the calculations manually (read more).
Ichimoku is a Japanese charting technique developed before World War II by a Tokyo newspaper writer, which literally means “one look”, presenting a panoramic view of the market.
It is enjoying renewed popularity and a chart of this style is referred to as Ichimoku Kinkou Hyou — the table of equilibrium prices at a glance.
An Ichimoku chart is a trend-following system with an indicator similar to moving averages. You may wonder how another eastern style charting approach can be different from an already impressive arsenal (read more).
If you have come to the market to play, then you will be able (very seldom!) to win, but with probability of 90% your money will go to a pocket of the more professional and competent players. Let's also ask the famous investor for advice and try to understand − why is this so? (Read more).
All beginners, even those who had theoretical training and already have the minimum experience, suffer a «Woe from Wit» syndrome after the first losses, and the more active their subsequent actions, the worse it affects their deposit.
As a result, there is one step before a nervous breakdown and only several steps before the total loss of the trading account (read more).