Trade Signals
As a trader one of the courses you must learn when it comes to trading the market is how to generate trading signals. A signal is just a set of rules that show when to buy or when to sell a commodity.
For example the simplest system is the MA cross over system which generates signals once 2 MAsmoving-averages cross-over each other.
- Buy signal - moving averages cross over pointing upwards
- Sell signal - moving averages crossover pointing downward
Trade System
To confirm the signals generated one will need to come up with a system & a set of rules for this trading system.
A system is a combination of 2 or more indicators and a set of written trading rules that are used to generate these signals with.
How to Create a Systems Strategies
From the above trade system a trader can generate signals using the trade rules below
Buy trade signal
- Both Moving averages pointing upward
- RSI above 50
- Both Stochastics heading upward
Sell trade signal
- Both Moving averages pointing downward
- RSI below 50
- Both Stochastics moving downwards
An exit signal is given when Moving Averages give an opposite trade signal or RSI gives an opposite commodity signal: A signal in opposite direction.
What is a Trade Plan? - Writing a Plan Example Template
Alternatives: EA Automated Robots or Copier Trading Signals
