Mar 18
Author : Dave Lex
In making or choosing a system, there are a few things to look for You want to make sure it is suitable for your style of trading and you want something that is simple rather than complicated, that is easy to understand, and that works The more complicated a system is, the more likely it is customized to the data You also want a system that will work over different time frames and markets as opposed to one that works only on a specific market and time frame A good trading strategy should work regardless of market and time frame
There are many different trading strategies that work Finding the one that fits you is what's important The following are few strategies that you could develop your trading systems upon:-
Breakout Systems
The oldest, simplest and most effective systems are breakout systems The reason these systems work well is that they will get you into a trade at the start or during the continuation of a major trend Every trend or major move starts with a breakout of the previous high or low, and if you want to get in on it, a breakout system is for you A trader using these systems must be willing to be wrong quite often, as they will produce many false signals that can cause one to buy many highs and sell many lows They key to making money with these systems is that one or two breakouts will be quite substantial and can more than make up for the false signals Break out systems are best suited for a patient trader who can wait for a retracement and then hold on to winning trades as long as possible
Trend-Following Systems
For those who want to trade with an established trend, moving averages and trendlines will be the core of your systems Since trendlines are hard to program, on is better off relying on moving averages in programming trend-following systems Those who use patterns, such as channels and lines as a trading guide most likely will have to make visual systems or draw their lines on a chart so that the software can compute signals Probably the greatest traders well-known for their trend following systems are Richard Denis and his turtle traders They have been hugely profitable and their method is very simple
Retracement Systems
The next kind of setup that you might want to consider in you trading is the retracement Basically this setup involves finding the longer-term trend of the market; getting some sort of pullback from the trend and then entering in the direction of the trend based on some third type of signal such as a resumption of the trend with a new high These are very old trading strategies Based on my own experience, retracement systems usually offer the least risk and the highest potential reward
Generally, the simpler your system, the better it will work trading the markets It is important that after defining the concept of your trading strategy, you rigorously test your system for at least a month to see whether it works I hoped these high probability trading strategies will help you in your journey to become a successful trader
Dave Lex is a full-time trader and trades the forex and the US stock and options market. He also constantly test and develop trading systems to share with the public. For more information on how you can get one of his high probability trading systems for free, go to http://ProvenTradingSystems.com
In making or choosing a system, there are a few things to look for You want to make sure it is suitable for your style of trading and you want something that is simple rather than complicated, that is easy to understand, and that works The more complicated a system is, the more likely it is customized to the data You also want a system that will work over different time frames and markets as opposed to one that works only on a specific market and time frame A good trading strategy should work regardless of market and time frame
There are many different trading strategies that work Finding the one that fits you is what's important The following are few strategies that you could develop your trading systems upon:-
Breakout Systems
The oldest, simplest and most effective systems are breakout systems The reason these systems work well is that they will get you into a trade at the start or during the continuation of a major trend Every trend or major move starts with a breakout of the previous high or low, and if you want to get in on it, a breakout system is for you A trader using these systems must be willing to be wrong quite often, as they will produce many false signals that can cause one to buy many highs and sell many lows They key to making money with these systems is that one or two breakouts will be quite substantial and can more than make up for the false signals Break out systems are best suited for a patient trader who can wait for a retracement and then hold on to winning trades as long as possible
Trend-Following Systems
For those who want to trade with an established trend, moving averages and trendlines will be the core of your systems Since trendlines are hard to program, on is better off relying on moving averages in programming trend-following systems Those who use patterns, such as channels and lines as a trading guide most likely will have to make visual systems or draw their lines on a chart so that the software can compute signals Probably the greatest traders well-known for their trend following systems are Richard Denis and his turtle traders They have been hugely profitable and their method is very simple
Retracement Systems
The next kind of setup that you might want to consider in you trading is the retracement Basically this setup involves finding the longer-term trend of the market; getting some sort of pullback from the trend and then entering in the direction of the trend based on some third type of signal such as a resumption of the trend with a new high These are very old trading strategies Based on my own experience, retracement systems usually offer the least risk and the highest potential reward
Generally, the simpler your system, the better it will work trading the markets It is important that after defining the concept of your trading strategy, you rigorously test your system for at least a month to see whether it works I hoped these high probability trading strategies will help you in your journey to become a successful trader
Dave Lex is a full-time trader and trades the forex and the US stock and options market. He also constantly test and develop trading systems to share with the public. For more information on how you can get one of his high probability trading systems for free, go to http://ProvenTradingSystems.com
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