How to build trading system

Analysis of new indicators. Steps to how to build trading system

All experienced traders once started. Everyone at first was only the interest and desire to have the extra money.

In Internet search engines flashing colorful ads with slogans: "build your own trading system and start earning money right now," "Start with a minimum deposit of your trading system", "20% profit per month trading robot," "The best trade conditions. Scalping is allowed. " A huge number of dealerships, each with its own advertising their offers, features. For a man who had just come on the market it is all dense forest. He rushes to the first run were caught dealerships, among which the most suitable working conditions. Opens a demo account, download and install a terminal metatrader, what next to build trading system? Then the trader-beginner there a lot of issues that he needs someone to ask. Well if he has in this case have a friend who had already studied all of this and can explain, but if that is not, then the trader will have to look at all the answers yourself. Climbed vast expanses of the Internet, asking questions on the forums, he begins to understand what the Buy, Sell, Stop Loss, Take Profit, indicators, advisors, bulls, bears and many more in what.

Naturally, human nature is composed in such a way that it is primarily looking for an easy way. So the easy way to build trading system in the forex market, according to a novice, of course, is the "counselor" or as they are called "trading robot", but in reality it is rather hard way. Shopping robots million dollar amount. Here Ilan-s, Gepard-s, Pallada and a lot of different advisors for transfer are not enough pages. After working on a demo account a couple of months a trader understands that the adviser is not so easy to make. Trust him with this deposit real hard, this requires a strong belief in the work of counselor and always-on computer, again, in any case psychological barrier allows a trader to leave the place of work and require it to carefully monitor the work of the adviser. Working with an advisor in any case, stress and excessive fatigue. Another of the old tales, we emphasize the morality that easy way is always difficult.

Finally, the novice comes to such a milestone in its development, he understands: "In the forex something needs to change." At this stage of its development, it attracts more scalping. Advertise in fact says that this is the easiest way to earn yourself without adviser 20-30% profit per day, it is necessary only to catch market moves with the indicators for the scalp, quickly close the profitable and losing trades. As the saying goes: "Business is." But here, it offers a rake. A trader works in compliance with the rules of scalping, analyzes the market, looking at the indicator signals. Buys, sells, wins, loses job turns into a jump on a horse, up and down. Trader "jumps up and fidgeting" in the chair of nervous tension. Some people do not like this method is no longer trading and he is still scalpers, but most still work so very hard. Yes, and covered with gray hair prematurely reluctant to no one else.

Here a trader comes to step number three and asks, "How to work in the market and at the same time as you can spend less time, nerves and earn stable?" Again, to help him come to books, forums, friends. A trader starts to think about trading the longer time intervals schedules and finding a good trading strategy. On the daily charts, but still at a very small deposit, you must be very careful in the analysis of prices. Movement on the intervals from hours to days, much longer than the Orientation meeting. The prices here are more transparent, easier to analyze, less unpredictable shocks and vibrations. In the graphs of D1 with a small deposit is lots to play no more than 0.1. You'll find out in detail, read below.

At this stage of his growth as a trader, a man begins to understand that the market is not a toy, money, he just will not, so it should not be lazy to earn, learn how to read more. The books for beginners write that we must first develop your trading system does not take a ready-made (to buy, etc.), namely to establish himself.

In many books written on this subject. Any classic indicator there is painted inside and out. With the new developments are much more complicated. New indicators are not described, there are many, but information about them is very small. The only source of information on new indicators that forums and portals, distributors. The forums and portals, as a rule, scanty information that tells when to buy and sell. It is not enough. What to do with the time interval settings, the ins and outs of the indicator? No, of course, there can be read on any chart is better to use an indicator, with some settings and even on a pair. Often, these data garbles (say from personal experience) and believe they are 100% worth it. Therefore, if you decide to include in the trading system only new lights, you should carefully review them on a demo account.

Below I give a rough plan of action for this:

1. Determine what type of indicators, it is:

a. Build Trend indicators.

Trend indicators work well on trend, ie the long ascending or descending trends. These indicators are useful when you need to know the trend, if it is to confirm or flat (sideways trend). These indicators are the classical moving average indicator Alligator Bill Williams

b. Oscillators.

Oscillators allow a trader on the basis of data from the past to predict future price movements. These indicators, for example, are classic indicators Macd, Stohastic.

c. Digital.

These indicators are the same as behaving in trending markets, and on the side. For example, the indicator Zig-Zag, an indicator of profit I-Profit.

2. Determine at what time period works best indicator.

Many indicators are not suitable to use on short time frames, because a lot of false alarms fed because of the noise of the market.

3. Determine the most appropriate setting indicator to build trading system.

Such parameters may be, for example, a period averaging factor, the smoothing method and others.

4. Indicator to identify deficiencies in building trading system.

Disadvantages of the indicator can be anything. It depends on the indicator, but the most common are:
a. number of false alarms.
b. ease of use.

It is very frustrating when the indicator often gives false signals. On this parameter depends very much on the profitability of its use. Very importantly, how convenient to use this indicator. The indicator should be as simple as possible, but give as much information, do not clutter up the schedule a variety of colored lines, because of which the trader will not be able to analyze it. Most indicators are redrawn. With this drawback, too, must be very careful. One such indicator is the Forex Glaz.

5. Determine for themselves the usefulness of the indicator in build trading system.

The usefulness of the indicator is not less important parameter than the others. Maybe so that the light is best replaced by any other, because it has a much higher technical data. Some of them I've described above.

So you've set for ourselves a leading indicator of future of its trading system. Revealed all its pluses and minuses. Now, on this basis you can try to build your trading system. For this we must know the criteria of your trading system.

In the building trading system include:

1. The main indicator.

This indicator would have greater weight in the analysis of the market. It was his signal will be fundamental to the analysis of prices.

2. The second indicator.

The second indicator is very useful. Its main purpose in the trading system - is a filter signals first. For example, if the first indicator says to buy, and the other does not confirm this, or vice versa says of the sale, the transaction is not recommended. This indicator is usually chosen so that it overlaps the main drawbacks. Indicators may be as much as anything, the question is only in the management of a large number of them. Many - not so good quality. I would recommend using just two, maximum three. As you work in the market you are sure to specify the number yourself.

3. Money management in build trading system.

The main purpose of money management is to strictly control transact. helps the trader to consider the risks, namely, set stop loss and take profit on the basis of the deposit amount. At this point, the trading system you must determine for themselves what amount of money from each deal you're willing to sacrifice. It is also important to determine the possible level of price movement. With this you can very well help to cope Fibonacci lines. Fibonacci lines on a certain probability can be predicted for a number of items price will be the trend or will correct the main trend.

4. Psychology in build trading system.

This point I think I singled out, because if your trading system will be weak emphasis on the psychology of trading, the whole system will not bring the fruits of success. This is the most difficult moment in the construction of a trading system. Most traders are perfectly through various methods to predict the market, but because of unfinished psychology can not make money on it. There are cases when a trader asks the second person to make purchases or sales. This item includes work on his inner world, a far more difficult than to understand the indicators, advisors, orders, etc.

Build Trading system based on technical analysis, fundamental analysis is recommended to supplement or candle. There are times when any trading system based on indicators give serious failures, due to limited data to be processed. Candlestick analysis, with its candle shapes perfectly enhance your ability to forecast prices. Candlestick analysis can predict the market turn, the future trend, and each candle say who at this stage to dominate the market (bull or bear).

Build Trading system can be constructed not only on technical analysis, there are opportunities to build it on a graphical analysis, candlestick and fundamental. On what principle, to build a trading system for each trader to decide. There is a great opportunity to show their creative data and make it original, not like all the rest. Your trading system will then reflect your personality. In the market survival of the fittest, and the power of knowledge.


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