How to create a trading system
Determine which type of trader you belong to. What trade suits you more: long-term or intraday. Or maybe you like to analyze charts every day, week, month or year? Also determine how long you can keep the position open. After answering the questions posed, you can select the required timeframe (the time interval used for grouping quotes during the construction of price chart elements) for trading.
Find the necessary indicators that can help you identify a new trend. Indeed, one of your main goals when creating a trading system is to identify trends as early as possible, as far as is possible. That is why you need indicators working in this direction. At the same time, moving averages are one of the most well-known indicators that are used to identify a trend. You can use two moving averages (one should be slow and the other fast) and wait for the moment when the fast moving crosses the slow.This is the fastest method to identify a new trend.
Identify the risks. When developing a trading system, it is very important to determine how much loss is possible for each individual trade. Decide how much space you need for your position so that it does not close the foot too early. At the same time, limit the risks to the trade.
Determine entry and exit points. Enter the market as soon as the indicators give a good signal, and the candle will be closed. For the exit point, you can apply a trailing stop, which means moving the stop-loss level by a certain number of points, depending on how much the price went in the direction of your profit.
Set a goal and close the position when the price can reach the goal level. Do not leave ahead of time from the position that would not happen. Stick to your own system.
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