How to define market trend ?

[newtrader1]

I am trying to make a trading system but so far not much success.

My system is very simple::

Stochastic : 14 3 3
When stochastic cross 80 and falls down then open sell.
When stochastic cross 20 and moves up then open buy.
Time frame is 15M.

So far lots of lossing trades.

I think If I trade with trend and skip trades against trend then I will get more winning signals.

I tried to use 200 EMA but did not worked well.
Example: If market is above 200 EMA only take buy trades and If market is below 200 EMA only take sell trades

The main problem is that I do not know how to define the market trend correctly.

Can some one help me in this regard?


BEST WISHES,
-NEWTRADER

[kenny]

Hello, fellow fxmasters!I need a great assistance concerning the usage of 1 minute, 15 minutes, 1 hour, 1 day, etc in different currency pair. Does each pair has its own unique timeframe or you can use anyone you like?Also, sometimes, 1m timeframe may indicate an upward trend while 1 hour or so indicates a downtrend. When I see this, I become confused and unable to know the suitable one to use.I will be very glad to get this problem solved and this confusion stopped.Kenny

[et_phonehome_2]

The 200EMA can vary between all TimeFrames. If you are trading off a particular timeframe, just look at the timeframe higher to determine where the trend is. You should try using MAs as guage when to enter, eg., if price touches the MA, its only then you will consider buying/shorting. Proce could be so far away from the 200EMA that eventually price will cross it, eg., the EURJPY did that today.... Know your timeframe, and when to enter....

[Van]

Hello, in general, Timeframe plays great much role in understanding and defining trend. Price actions can be trending in one timeframe and show just the opposite trend in other. So, the question is in what timeframe you are looking for trend. Where the trend ends and where it begins. These are almost philosophical questions. All you need is to mention timeframe and identify extremes.
You can use MA, MACD, ADX or any other indicator but in my belief the best trend identification is the simplest and oldest one.
You have up trend when each next extreme (both max and min) is higher then previous.
For down trend, the opposite is true.
Wining signals can be generated just based on this simple rule.

[bossxero]

Another way to detect and measure trend strengh is to put RSI indicator on the daily timeframe with default settings and a 50 limit level, if RSI above 50, look for long positions only in the lower TFs and if its below 50, do the inverse.

Hope that helps

[newtrader1]

Yes it is may be a good idea to look higher time frames.

Can some one tell me how to find the market trend if I am doing
trading in a monthly time frame?


BEST WIHSES,
NEWTRADER

[bossxero]

Originally Posted by newtrader1

Yes it is may be a good idea to look higher time frames.

Can some one tell me how to find the market trend if I am doing
trading in a monthly time frame?


BEST WIHSES,
NEWTRADER

Draw a trendline The first thing you should study about trends is how to draw trendlines the right way. A trendline will give u the trend direction of the current instrument.

[newtrader1]

Yes it is a good idea but as I mentioned I use stochastics so my buy and sell signal always come before any trend line break.

I tried to use that but it did not worked well and most of the time it is a long way to wait for the trend line break and then enter into trade.

Need some thing quick that tells we are in a up or down trend.
Anyway thankyou for taking the pain.

I think I need to consult some professional trader with a bundle of US$ ;-)



EST WIHSES,
NEWTRADER

[bossxero]

Originally Posted by newtrader1

Yes it is a good idea but as I mentioned I use stochastics so my buy and sell signal always come before any trend line break.

I tried to use that but it did not worked well and most of the time it is a long way to wait for the trend line break and then enter into trade.

Need some thing quick that tells we are in a up or down trend.
Anyway thankyou for taking the pain.

I think I need to consult some professional trader with a bundle of US$ ;-)



EST WIHSES,
NEWTRADER

Spend your money wisely because there are many professional crooks who are here to take your money. You should know that waiting for the right moment to trade is also part of the game The desire to be always present in the market is a very bad and can lead you to losses.

There are many systems that you can choose from. If your system does not seem to work, then look for some other one. I firmly believe that you can become a pro trader without spending a dime. But its up to you...

[newtrader1]

Can you show me any and I mean any trading method posted
in this whole forum that give you a winning ratio of 80% or above ???

BEST WISHES,
NEWTRADER