A Journey to Master Forex Trading (FX Trader from Singapore)

Sunday, December 7, 2008

Trading Strategy - ADX with Stochastic:

ADX with Stochastic:

ADX:
define trend force, whether the trend will develop further or will gradually weaken.

Three lines in ADX:
1) +DI (Yellow)
2) -DI (Red)
3) ADX line (Blue)

Stochastic: compares a stock's closing price to its price range over a given period of time.

Using the both will give traders great forecasting trend strength.

Two lines in Stochastic:
1) %K: This is the number of time periods used in the stochastic calculation.
2) %D: This is the number of time periods used when calculating the moving average of %K.

Signal to buy:
When either %K or %D falls below the line, and then again crosses the bottom level upwards or when the curve %K crosses the curve %D from below upward.
When +DI is higher than -DI

Signal to sell:
When oscillator grows above the line, and then crosses the top level downwards or when the curve %K crosses a curve %D from top to downward.
When +DI is lower than –DI

adxsoch

No comments: