4 Example Templates of Stock Indices Trading Systems
When creating your own indices trading system, there are a few things to keep in mind. Your indices strategy needs to be able to identify new Indices Trading market trends, while at the same time making sure you do not to get faked out -indices trading whipsaws. The real trick is, once you've created a indices trading system that works for you, stick to it. Being disciplined will help you a lot in becoming successful in stock indices trading.
Before trading Indices on a live indices trading account, you have to figure out what indices strategy works for you. It's good to know in what chart time-frame you are going to be working in, and how much you're willing to risk once you begin indices trading. All these factors should be factored in, and should be written down within your indices trading plan. A good place to test this indices trading plan would be on a free practice trading account. This is where you test your strategies risk free without investing money to determine which indices trading strategy is best suited for you.
So, now how can a trader like you create a "good indices trading system" or the "best indices trading system"?
To come up with the best trading strategy the first thing to do is to define your indices trading objective or goal:
The following examples shows a goal and explains the indices rules of how to achieve that goal
Goals of Indices Trading System
1.Identify a new indices trend
Moving average crossover strategy indices trading strategy is most oftenly used strategy to identify a new indices trend. The time to open a long or short trade is decided when 2 moving averages indicators cross over or cross under each other.
2.Confirm the new indices trend
Relative Strength Index(RSI) Indicator and Stochastic Oscillator Indicator are the most commonly used technical indicators to confirm a Indices trend.
Indicator based Trading System
The best type of a indices trading strategy is one that is indicator-based. You will find it straight forward to generate the stock indices signals & thus less error-prone on your part & this will help you to avoid market whipsaws.
There are several things we want to achieve when creating a Indices trading system:
- Find entry points as early as possible.
- Find exit points securing maximum gains.
- Avoid fake entry and exit signals.
- Proper Stock Indices Trading Money Management Guidelines
Finishing these 4 goals will result in a profitable indices strategy that works.
The last piece of information needed, is deciding how aggressive you are going to be when entering and exiting a trade. Those traders who are more aggressive wouldn't wait until the stock indices chart candle stick closes & would enter as soon as their technical indicators match up. But most traders would wait until the stock indices chart candle of the chart time frame they are using has closed, to have more stability when entering a the stock indices trading market.
To get profits out of the stock indices trading market you need to build your own profitable trading system: a trading strategy that will generate profitable trading signals. You need to have your own strategy that will help you achieve your financial goals. Sometimes the best trading systems are the ones that you build on your own. No need to keep searching online for best indices trading systems or for indices trading systems which work, this site provides you with all the indices trading tools required to help you and tutorial you on how to come up with your own indices trading systems.
Shown Below is example of a Indices trade system based on RSI, MACD and Stochastic.
Indices System - MT4 Chart Templates Indices Trading Systems
The trading system example above is comprised of four technical indicators in total, all of these generate Indices trade signals using different strategies, the moving average will generate stock indices signals using the moving average crossover strategy shown, the RSI indicator, Stochastic indicator & MACD indicator use different technical analysis to generate the long and short signals as shown in the above example. How to generate these trading signals is discussed in the next topic (on the sidebar navigation learn tutorials menu under key concepts).
For beginner traders, it's difficult for them to create their own indices trading strategies since they don't have a lot of knowledge about the stock indices market. However, this learn indices trading site will explain how a beginner trader can create their own free indices trading system in just seven easy steps. The best strategy is one you come up with yourself and learn how to trade the stock indices trading market with it.
The main advantage of creating your own free indices systems is that you will know how to make profits by yourself - and not rely on other peoples efforts.
In the next lesson located at the sidebar navigation learn lessons menu below the indices trading key concepts will show you how to create a indices trading system like the one above, write it's indices trading rules & how to back-test the system on a practice demo stock indices trading account before using it on a live stock indices trading account.
4 Examples of Free Indices Trading Systems
Example 1: The Moving Average Crossover Strategy
The moving average indicator cross over strategy uses two moving averages to generate indices trading signals. The first Moving average uses a shorter period and the second is a longer period.
Moving Average Crossover Indices Trading Method - Moving Average Crossover Strategy
This above indices trading strategy is referred to as the moving average cross over strategy because stock index signals get generated when 2 averages cross above or below each other.
Indices Trading System Trading Example Template - Short & Long signal Generated by Trading System
A buy stock indices signal or going long trade is generated when shorter moving average indicator crosses above longer moving average indicator (Both Moving Averages Moving Up).
A sell stock indices signal or a going short trade is generated when shorter average indicator crosses below the longer moving average indicator (Both Moving Averages Moving Down).
Example 2: Stochastics Stock Indices Trading System
Stochastic Oscillator technical indicator can be combined with other indicators to form a trading system.
- RSI indicator
- MACD indicator
- Moving Averages stock indices indicators
Trading Systems Indices Trading Example - MT4 Chart Templates Indices Trading Systems
Short Signal or Sell Trading Signal
How the short sell Indices signal was generated
From our indices rules the short signal is generated when:
- Both Moving Averages are heading down
- RSI is below 50
- Stochastic moving downward
- MACD moving downwards below centerline
The short trading signal was generated when all the written indices trading rules were met. Exit signal is generated when a stock indices trade signal in opposite direction is generated.
Good thing about using such a indices trading strategy is that we are using different types of technical indicators to confirm the stock indices signals & avoid as many whipsaws as possible in process.
- Stochastic -indices trading momentum oscillator indicator
- RSI -indices trading momentum oscillator indicator
- Moving Averages -indices trend following indicator
- MACD -indices trend following oscillator
Based on the chart timeframe used - this strategy can be used as Indices Trading scalping system when the minute stock indices charts are used or as a Indices Trading day indices system when hourly stock indices charts are used.
Example 3: Trading System Stock Indices Trading Example
This system is fully described within the indices trading plan on the indices trading plan lesson on this learn indices site under the Indices Trading key concepts section located on right navigation menu.
Chart Time Frame
1 hour chart
Indicators that identify a new indices trend
Moving Average Crossover Technical Indicators Strategy
Indicators which confirm the indices trend
RSI indicator
STOCHASTIC OSCILLATOR indicator
Long Entry - Buy Signal
1. Both MA(moving averages) pointing up
2. RSI above 50
3. Both stochastics going up
Short Entry - Sell Signal
1. Both Moving Average pointing down
2. RSI below 50
3. Both stochastics going down
Exit Signal
1. Moving Average Trading Indicator gives opposite signal
2. RSI gives opposite signal
Risk Management in Indices Trading
Stop loss- 35 pips
Take Profit Indices Order - 70 pips
Reward to Risk 2:1
MT4 Chart Templates Indices Trading Systems
The Gann Swing Oscillator is meant to be used in combination with the Gann HiLo Activator and Gann Trend to form a complete indices trading strategy commonly referred to as the - 'New Gann Swing Chartist Plan'. Within this indices trading strategy the Gann Swing Oscillator is used to help ascertain stock indices market swings for trading only within the current indices trend is shown by the Gann Trend.
Shown Below is examples of New Gann Swing Chartist Plan
Gann Chartist Plan - MT4 Chart Template Trading System
