Forex System



ACCURATE ALIGNMENT FOR HANDS-FREE FOREX TRADING

Accurately aligning the periods D1, W1, and MN1 in any chart is the key to hands-free Forex trading. The simple moving average MVA-3 or SMA-3 closely traces the path of most Forex pairs and even equities. It is important to compare approximately the same number of trades in each period. Between 50 and 65 trades should be okay. Thus D1 for 2 months gives 60 trades, W1 for one year gives 52 trades, while M1 for 5 years give 60 trades. See charts below.

AUD/USD D1 MVA-3



AUD/USD W1 MVA-3


AUD/USD MN1 MVA-3                                                                                                                             



Notice that the pink MVA-3 line is saying the same thing in all three periods. This is an alignment that allows short trading of AUD/USD for quite a while.




CONFIRMATION OF D1 MVA-3 DIRECTION WITH DAILYFX SUPPORT/RESISTANCE DATA

Usually the first chart to go off alignment is the D1 MVA-3 chart. The misalignment may be so large that an investor is tempted to immediately reverse trading direction. But before such a reversal is made, it is always better to examine W1 MVA-3 and MN1 MVA-3 charts. If two of them are still in alignment, the best response would the to cut losses by reducing lot size and maintain the same trading direction. The lot reduction could be as much as 10000 >>> 1000 units depending on how uncertain the investor is.

One way of ascertaining whether a trending will be short-lived is by listening to Forex news and looking at DAILYFX support-resistance data.



 AUD/USD
                                   
R3: 0.7346m
    Trend: up
R2: 0.7291m
                                        
R1: 0.7235m
                      
S1: 0.7145s
    Volatility: 3%

  S2: 0.7056m
                                        
S3: 0.6946m
                                        
   With the current market price for AUD/USD at 0.71896, it is clear that the top support line has been overtaken with the instrument sitting on S2: 0.7056m line. But a look at R1 at 0.7235m shows that a trade reversal is imminent. In addition to R1, there two other resistance lines that must be broken, for the upward surge to continue. These three resistance lines will then form a reliable basis for believing that the market trend will soon be reversed back to the short direction, and therefore there is no need for change in trading direction.        

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