Indices Trading System Rules: Write Down The Rules & Follow Them

We shall use the previous steps to create a written indices trading system that generates the trade signals displayed below using the 1 hour chart. We shall use the 1 hour stock indices chart to write the rules of this indices trading strategy - stock indices trading system.

A indices trading system refers to a set of written indices rules that you follow to manage your trades. These rules must be written down so as to guide you. The following tutorial will show you how to writedown the rules of your trading system.

Keyword is a SET OF RULES which you must follow. If you don't follow the rules then you don't have a stock indices trading system. Trading systems must have rules which are written down within your indices trading plan.

Example of Indices Trading System below:

Writing Rules of a Indices Trading System- 1 hour Indices Chart Time frame Trading

You can come up with the above indices trading system using steps below:

Choose your Chart Timeframe - 1 hour chart

Choose Technical Indicators that spot a new trend - Moving Average Crossover System.

Select Technical Indicators which confirm the indices trend - RSI, Stochastic

Finding entry & exit points

Long Entry

1. Both Moving Average pointing up
2. RSI above 50
3. Stochastic oscillator going up

Short Entry

1. Both Moving Average pointing down
2. RSI below 50
3. Stochastic oscillator going down

Exit

1. MA gives opposite signal
2. RSI gives opposite signal

Calculating risks in each trade - 20 pips

Write down the indices trade system Indices rules

Test the system on a stock indices trading practice trading account

After using these steps we create written indices system rules below.

Writing Indices Trading System Indices Rules

Example of How to Write the Best Indices Trading System Rules

This trading system produces the signals as shown below. Using these rules traders can determine when to enter and exit trades.

Generate Buy & Sell Indices Trading Signals using Written System Rules

We have completed writing the rules, if you are researching on how to create the best indices system, this tutorial is a good start to guide you on how to do just that. This is one part of a the indices trading plan. Now how do you create a complete indices trading plan? To read about Indices plan tutorial go to the right navigation menu of this website under key concepts where you can find a link for this Indices trade plan topic.