In my pervious post was a simple trading system on the
EURUSD evaluated; in this post is another trading system evaluated.
Trading
system
The trading system is the use of the Parabolic SAR indicator
as primary indicator and the MACD as a secondary indicator.
The MACD is in the post “TradingForex using the trading strategy 123 trading signals” described and the Parabolic SAR indicator is in the post
“Parabolic SAR Stop and Reverse Technical Indicator” described.
Time frame
The evaluation focuses on the charts 15 minutes, 30
minutes and 1 hour.
Note
Please note that this post is only illustrative and
the purpose is to give insight into how to trade.
Evaluation
1
The evaluation is on the EURUSD.
The charts show that the system is working well in
connection with this evaluation; the charts also illustrate that the market is
in a trend-following market condition which is the market condition the
parabolic SAR works best in.
The time frame; the trend direction the parabolic SAR
indicates; is longer in the 1 hour chart
than in the 15 and 30 minute charts which does that the 15 and 30 minute charts
are better to use than the 1 hour chart in connection to the time frame in a
trade.
The time frame in a trade on the 30 minute chart is
days; in the 15 minute chart is the time frame in a trade a day or hours.
The charts
The charts; 15 minutes, 30 minutes and 1 hour; are
illustrated in the following; trades are illustrated as long and short trades;
first is the Parabolic SAR trend evaluated and second the MACD; is the lines
crossing each other and indicating that the trend direction is changing.
Evaluation
2
The evaluation is on the NZDUSD.
The charts show that the system is working well in
connection with this evaluation; the charts also illustrate that the market is
both sideways and trend-following; the Parabolic SAR is difficult to use in a
sideways market where the currency rate is sideways.
The time frame; the trend direction the parabolic SAR
indicates; is longer in the 1 hour chart
than in the 15 and 30 minute charts which does that the 15 and 30 minute charts
are better to use than the 1 hour chart in connection to the time frame in a
trade.
The time frame in a trade on the 30 minute chart is
days; in the 15 minute chart is the time frame in a trade a day or hours.
Conclusion
In connection to this evaluation is the trading
strategy Parabolic SAR and MACD working best in a trend-following market.
The 15 minute and 30 minute charts are the best charts
to get an indicator of the trend direction as the trade is shorter than on 1
hour chart.
Note this evaluation is only illustrative and only
inspiration to traders’ thoughts.
