Perfect Order

January 2, 2006 by Trader Rich 

Required Indicators:    Moving Averages (minimum of 5; ie: 10-day SMA, 20-day SMA, 50-day SMA, 100-day SMA, 200-day SMA)

Trading Environment:  Trending environment near the beginning of the trend

Condition Required:    Moving Averages need to be in perfect order or in sequential order.  For example, in an uptrend, a perfect order would be when 10-day SMA > 20-day SMA > 50-day SMA > 100-day SMA > 200-day SMA

Rules:   

1.    Find currency pair with MA’s in perfect order
2.    Look for ADX pointing upwards, ideally greater than 20
3.    Buy 5 candles after the initial formation of the perfect order
4.    The initial stop is the low on the day of the initial crossover for longs and the high for shorts
5.    Exit the position when the perfect order no longer holds

Popularity: 11%

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