Trade on daily chart (swing trading)
5 EMA applied to the close
10 EMA applied to the close
Stop Loss = 2-3%
Entry RulesEnter long if:
The 5 EMA crosses above the 10 EMA and both stochastic lines are heading up (do not enter if the stochastic lines are already in the overbought territory)
RSI is greater than 50
For the above trading system I scanned using my Iris software where
iam able to get the followig results
NSE F&O Stocks
Exit when the 5 EMA crosses the 10 EMA in the opposite direction of your trade OR if RSI crosses back to 50
Good to backtrack at this time to know about the expectation of profitablility To know more about the trading system visit
Your trading system should attempt to accomplish 2 goals:
-Be able to identify a trend as early as possible
-Be able to find ways to avoid whipsaws (confirm your trend)
If it is profitable, then you trade your system live on a demo account for at least 2 months. This will help you get an idea of how you would trade your system when the market is moving. It is a lot different trading live than manually backtesting.
Once you’ve demo traded your system for at least 2 months and you are still profitable, you are then ready to trade your system live with real money. However, you must always remember to stick to your rules no matter what!
Find indicators to help you identify trends early
Find indicators to help you avoid whipsaws and confirm your trend
Define your risk
Define your entry and exit
Write your trading system rules down and ALWAYS stick to those rules!
There are 3 phases to testing your system:
If you have tested your system thoroughly through back testing and by trading it live on a demo for at least 2 months, then you should feel confident enough to know that as long as you follow your rules, you will end up profitable in the long run.
Trust your system and trust yourself!