My Rules 5 Min Intraday Trading System 20070622 (PDFDrive)
My Rules 5 Min Intraday Trading System 20070622 (PDFDrive)
My Rules 5 Min Intraday Trading System 20070622 (PDFDrive)
1.5 Optional:
1.5.1 PhilNelsignals indicator (post #399 on page 27 of thread & page 39) downloaded
from thread
1.6 Optional – The EJ_CandleTime(1)H indicator from the 4h MACD thread to look at the time
left before closure of current candle.
Example of Chart:
2. THE TRADE CRITERIA:
Criterion 1: 50SMA angle to be more that 20 degree
Criterion 2: 21EMA on SMAangle indicator to cross the 0.1 or -0.1/0.15 or -0.15 line.
2.2.1 The area between the 0.1 and -0.1 lines is called the no-trade zone.
2.2.2 No trades to be taken if 21MA is in the no-trade zone.
2.3.1 The area between 10MA & 21MA is called the fire or war zone
2.3.2 In the war zone is where the action is – you’ll enter your trade
2.4 Criterion 4: The price should stay on the correct side of the small resistance/support
line
2.5 Optional – SMAangle bars to be higher or lower than 0.2 or -0.2 line (I don’t use it any more
– the small resistance/support line is more accurate)
Example of chart:
3. THE TRADE SET-UP:
Rule 1: Small trend line rule:
3.1.1 Ensure that the price and candles stay on the correct side of the small trend line.
3.1.2 Any break-out cancels the set-up/possible trades
3.3.1 Identify the first candle to enter the war zone towards 21MA
3.3.2 Wait for second/more candle to pull back from 21MA towards 10MA
3.3.3 Enter the trade on the pullback a few pips away from the 21MA
3.4.1 For a long trade, the positive line (Blue) must be above the negative line (Red) with Isma
line crossed the red line to go in between Blue and red line
3.4.2 For a short trade, the negative line (Red) must be above the positive line (Blue) with Isma
line crossed the blue line to go in between Blue and red line.
3.4.3 The trend line must be above 25 level
3.4.4 If the ratio between the positive and negative line is almost 2:1, expect the pullback only up
to the 10MA and enter the trade.
Example:
4. THE TRADE:
4.1 Use a market order to enter within the war zone as specify
4.3 Move stop loss to breakeven after a clean 6 pips gain/profit (brokerage/spread included
Phillip’s advice:
Chart to explain Phillip’s advice:
Another example in the change of the trend speed with excellent trade set-ups after 06:00:
7.3 First pull-back to 10MA – fast speed:
• Consider taking the first trade during the fast speed trend (comply with set-up criteria)
when price have a pull back to 10EMA – price tends to bounce off 10EMA first
• Be careful – very risky – look at the example
• When the 50SMA is clearly in a trend, wait for the price to pull back into the zone. If it
goes through the 21EMA wait for the next bar to move back into the zone and then
enter. When the trend is very strong it does not normally pull back deep into the zone.
Look at history and you will see that. If two to three bars in a strong trend find support on
the 10EMA just close your eyes and enter. Rules stay the same.
You will find that it is only often that the 10EMA and 21EMA are more than 6 pips from one
another. In most of those cases the trend is very strong upwards and then there is not a pullback to
the 21EMA. Try to enter anything from 2 pips inside the zone. Sometimes the move downwards is
fast and then wait for a slowdown before entering. With time you will get the feel for it.
7.4 Wait for two or more candles to enter trade/war zone (between 10 & 21MA):
• Wait for two candles to make contact with/enter the war/trade zone on the chart
before consider entering a trade.
• Not necessary for second candle to open or close in the war zone
• Entry should be made as close to the 21EMA as possible. When the move is quick
halfway between the two is OK while when the move is slow closer to the 21EMA. It
means 2-3 pips difference between the two.
Example of 2 or more candles within the war zone before entering a trade:
7.5 Look for the width between the 10 & 21 MA:
• Be careful when looking at the width between the 10 & 21MAs.
• The angle is very important but look at this example of the GBP forming. The 21EMA
and 50SMA are too close together and the angle between the two is not opening up
but running parallel. Phillip won'
t get involve at all.
7.6 Look for the length of the current trend:
• Trends tend to come in beads -(30, 60, 90 & 120)
• Be careful when the current trend is running for 60-100 pips without a pull-back –
trend could run out of steam shortly
• Indication of a run out of steam – Uptrend and price did not close higher than the
previous high indicating
• Look at this example of an earlier trade of mine – wrong!!!!!!!!!!!!!!!!!!
7.7 5-6 candle rule: Profit not triggered within 5 candles, consider closing the trade:
• If your profit is not triggered within 5-6 (25-30 minutes) candles, consider taking
profit/break-even as soon as possible.
• Phillip’s comment on this trade of mine (example below): “It was one of those setups
that looks OK eventually. Look at the 21EMA flattening out. If there is no movement
in 5-6 bars get out as close to breakeven as possible.”
7.8 Close trade when there is close above/below the 21MA:
• If there is a close of a candle above the 21EMA in case of a short trade and below the
21MA in case of a long trade, consider taking profit quickly or take break-even trade.
• Consider not taking any more trades or wait for pull back from 50SMA
8.1 EURU$ made three trades. No 1 was right, No 2 was wrong and No 3 was right ending up
10pips for the day.
8.2 Nice pullback into the zone after it went above 21EMA with a inside bar therefore I took the
next bar with target +8 pips.
8.3 It is all about when the market is moving that by entering when a pullback occur in between
the 10EMA and 21EMA that the odds are in your favour to have 8 out of 10 winners. Phllip
enters somewhere in between the 2 EMA' s, preferably halfway if possible. Just look at
Friday late, it gave 2 trades.
8.4 Look at this one on the GbpUsd and let it run.
8.5 Phillip entered the GbpUsd @ 18:10 at 1.9445 because of several lower highs and angle
signal at zero. Took profit at 23pips. Phllip: “I knew due to the movement that the move
could be more than 10 pips so I put myself at breakeven after 10pips gain and let it run.”
Update:
I see that the deal was actually closed for 20pips.
8.6 Classic change from slow speed to medium speed trend with two trade set-ups: