Accumulation Distribution Divergence D1 Strategy - Part 5 | Trading Highlights
Автор: Project Trade
Загружено: 2023-10-08
Просмотров: 73
STRATEGY
On this reversal strategy we're looking for divergence from the accumulation distribution indicator. For out entry signal we’ll start by having a look at a 200 period exponential moving average for a filter on our trades. If price is above the moving average and clear of it then we’ll only be looking for sell trades. If price is below the moving average and clear of it then we’ll only be looking for buy trade. If price is on the moving average then no signal.
Then we can move onto our accumulation distribution indicator and we’re looking for our divergence between the last 5 and 60 candles. Don’t want weaker signals outside of that range. From there it’s the standard divergence. If price makes a higher high between two periods in the range, but on the higher high the accumulation distribution indicator actually makes a lower high, that’s a show that momentum on the move may have overreached and is now going to drop. Into a trade we get. Vice versa if price makes a lower low but the indicator reads at a higher low, we’d be in a buy trade for bullish divergence.
Once we’ve got the signal to get in we’ll need to assess for our money management. First off it’s vital to note if the candle for our entry signal is a reversal candle, we’ll double up our risk amount as we’ll be vibing on a bit of an extra indication of the move. 1% for each sub-trade without the reversal candle and 2% for each with it.
The stop loss for both sub-trades will go at 1x average true range distance from the entry price. For the take profits sub-trade A will be the same 1x average true range distance, but for sub-trade B we’re going big with 3x the average true range distance. Really looking for profit but we’ll want to lock in some profits along the way if we can so we’ll also be using a trailing stop loss on sub-trade B at 1x ATR value. So if we do take profit on sub-trade A, we’ll be guaranteed at least a cent from sub-trade B.
That’s the core of the strategy everything else is a personal choice so we can get trading.
ACCUMULATION DISTRIBUTION
• Accumulaton Distribution (A/D) Explained |...
https://www.investopedia.com/terms/a/...
EXPONENTIAL MOVING AVERAGE
• Exponential Moving Average (EMA) Explained...
https://www.investopedia.com/terms/e/...
AVERAGE TRUE RANGE
• Average True Range (ATR) Explained | Techn...
https://www.investopedia.com/terms/a/...
POSITION SIZE CALCULATOR
https://www.babypips.com/tools/positi...
All for entertainment purposes only.
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