Monday, 12 March 2012

Possible Idea: Daily Range & Momentum Oscillators

I was visiting a Forex Factory tread that mentioned a system based on CCI. The guy who made this thread goes by the name Forexcube, and he put in there a lot of information on CCI and damn near every system based off of this indicator. His system is called the TASAYC (Trade As Simple As You Can) System, and it's really just CCI (14), EMA (200), two Bollenger Bands (both 20, with deviations 2 and 3) and Daily Pivots.

From his record of trades he keeps on the first post, he seems to have made a very profitable system using these basic indicators. I try it out for a day, and found very little that I didn't already know. But he did do something with CCI that I thought was kind of bold. Usually I would trade using CCI's Zero Level, but for Forexcube he would trade using the 100, -100, 200, and -200 levels as entry and exit points. I wasn't quite sure how he could pull that off (I've tried those levels with little or no success in the past), but I now I think I have an idea as to how to trade from those levels.

The Daily Pivot indicator used in his system has a range calculator with it (the range is the difference between the high of the day and the low of the day) that displays today's range, yesterdays range, and an average range spanning 30 days. I found that if today's range is relatively the same as yesterdays and/or the 30 day average, and the CCI is coming up/down from either a 100 or 200 level, then it would likely continue. Even better if the price is at a support/resistance level when this pattern occurs.


Here's the TASAYC thread I got this idea from: