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Creating Your Own Trading System

In fact, there are two basic criteria that you actually have to program rules. Well, they are Market exit or your stop and market entry. Besides, you are able to utilize a bit number of various indicators to time your own trades. However, on some automatic forex trading system, it is necessary for you to utilize as few of them as possible. And so here I will show you how exactly to build your one rule forex system just based upon trading volatility.

Without any doubt, a quite simple trading system would certainly be one based on the standard volatility or deviation of price. For instance, so called Bollinger Band actually points out a mid-average band and also the two outer lines, standard deviation from the average to norm, as volatility really increases, then the bands are widen away from the average. Thus you can easily construct your simple volatility forex system with your personal settings. Well, below is what exactly you do.

Of course, it is necessary for you to decide your mid-line moving average to begin. And that is where particularly current prices are going to find support in the bull market and also resistance in the bear market. Moreover, your buy signals are going to be generated and also held in the bull market when the average is really hit. Besides, the outer bottom band will give the stop level as well.

For sure, what is necessary for you to do is to test many different standard deviation settings and also moving averages for the outer bands. However, it is very easy and simple to do with the modern software. And then it is necessary for you to decide your spread of foreign currencies to trade them on and also test them back over time to really see how successful and profitable they are. Because there is only one rule: it is going to show a very realistic back test of actual performance.

Without any doubt, the main logic of the above trading system is quite easy and simple for understanding. And below you are going to find how exactly to generate your stop and also buy signal in the bull market.

In fact, in some strong bull trend, actual prices may obviously go away from some average price. However, they are going to find support against the average. And so if volatility actually takes prices through this mid band to the outer bottom one, the demand and supply situation is possibly changing from bearish to bullish and your stop can be placed.

In addition, it is necessary for you to perform a little research. Besides, you are able to add extra filters when you want. You should remember that!

Before you make up your mind to make a forex investment or start forex trading yourself, better find a good forex book and learn more about foreign currency trading market – this will save you from lots of troubles and traps.

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