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Trading system support resistance

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trading system support resistance

Write for permission to reprint. Frequently Appearing Questions Home Tribe Directory - How to Join. TTP - The Trading Tribe Process The Trading Tribe Book. A Simple Trading System. Support and Resistance systems are among the easiest to compute. You can get your signals by inspecting a chart. Such systems perform about as well as much more complicated systems, indicating, perhaps, sticking to a simple system is much more profitable than trying to second guess a more complex one. This exercise introduces several new concepts not present in the Simple Exponential Lag System. I recommend you complete the Exponential tutorial before tackling this project. Readers who would like to duplicate these results can follow the tutorial at the bottom of this section. The system trades only one instrument: For information on continuous contracts, see the main TSP index, above. Signals issue right after the close. The system enters orders before the next open, to trade on stop, resistance following day. The system uses a slow metric to determine the overall system trend and then a fast trading to trade in and out within the direction of the long-term trend. N-day support is the lowest low for the past N days. For example, the day support is the lowest low in the past 50 days. The day resistance is the highest high in the past 50 days. When the price trades above the resistance, it defines the trend as up. The trend stays up until the price trades below the support. This defines the trend as support. If you graph support and resistance on a price chart, it appears as a corridor around the price. Penetration of corridor on the upside defines the trend as up while downward penetration of the corridor defines resistance trend as down. This system uses two sets of S-R lines: When the long-term trend is positive, the system then enters the market with a stop just above the short term resistance and then places a protective stop below the short-term support. When the long-term trend is negative, the system enters the market on a stop just below the short-term support with protection just above the short-term resistance. Chart Showing Metrics for SR System. That is, it executes buy orders at a price half-way between best support and the high of the day. The best price is the highest of the open, trading stop price or the low of the day. It executes sell orders at a price half-way between the best price and the low of the day. The best price is the minimum of the open, the stop price and the high of the day. The system exits the final trade at the average of the final closing price and the worst price of the day. The system does not charge commission for entering positions or for rolling forward. This system uses stop-specific position sizing. It figures the entry stop and the corresponding protective stop prior to entering any orders. It figures risk-per-lot as the difference between trading two system that is, it does not figure support an allowance for execution cost. The system then divides the equity budget by the risk-per-lot to determine the quantity. The system computes equity at the close and then figures orders, after the close, for entry the following morning. The system sketches the equity value, records the results in an equity log, the essential computations in a metrics log and the trades in a trade log. It also provides a computation dump to trace the workings of the programming for debugging purposes. Download the Gold Continuous data at resources. Program your testing software to duplicate resistance results for the system test, above. If you do not have testing software, you can put the data in support spreadsheet and create the system in Excel. When you succeed in duplicating this run, to the penny, send an email to FAQ. Please identify the software you use Excel, TradeStation, Proprietary, etc. Use your trading to find the set of parameter values that optimizes Bliss frequency for this system. Send your solution to FAQ. To see how other readers are approaching this tutorial and contributing to the project, see Reader Feedback, above. Yellow resistance Trading Metric 5 tostep 5. Green down Trend Definition Metric 20 tostep Trend definition lines shorter than days don't work well. Trading lines shorter than 15 days don't work well. Trend lines around days work best. Trading lines around 30 and 40 system best. Ed Seykota's FAQ formerly: Tribe Directory - How to Join TTP - The Trading Tribe Process The Trading Tribe Book TSP: Levitator System Now Mics Long and Short Positioning. Trading within the Trend.

LIVE $2K FOREX TRADE STRATEGY (How to trade support & resistance live )

LIVE $2K FOREX TRADE STRATEGY (How to trade support & resistance live ) trading system support resistance

4 thoughts on “Trading system support resistance”

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