iCharts Discussions

[rameshkg]

Dear All,

One of my friend doing trading with Moving Average Strategy for the past 2 years (Yes successfully )...

The strategy is purely mechanical in nature..

1) Time Frame: 15 Minutes
2) Trend Identification: using DMI
3) Entry / Exit : Price line crosses over / under EMA – 55
4) Long : Above high of the candle which cross over EMA 55
5) Short: Below low of the candle which cross under EMA 55
6) ADX below 20 identifies possible sidewise movements, at that
time decision should be made based on previous day’s low/high
(i.e long above pervious day’s high and short below previous day’s low)

Carrying positions:-
7) Carry Long position if the day’s closing is above EMA 55
Carry Short position if the days closing is below EMA 55

He says that, this strategy to keep ahead one with the market in capturing Big Trend movements and number of trade is very low. Of course we may face little profit / small loss when range bound days (use DMI, previous day’s high / low on those days).

I request ST sir, Experts and members to contribute their valuable suggestions on this.

Thanks & Regards,
Ramesh kannan G

[amitkbaid1008]

Dear Ramesh KG

It is very difficult to trade the moving average crossover. Using just one moving average like EMA-55 for price crossing on 15-Min Charts will not give any profits till big trends are there. Also in sideways movement it will give so many trade or if as you said will use ADX for trend identification then may miss the trade or be very late in trade as price candle may cross EMA-55 before ADX moves above 20 or some times EMA-55 may be crossed after long time of ADX moving above 20. Moreover stop loss will be quite high as time frame is 15-Min

Anyways better if you have explained this with the help of chart