MetaTrader 4 Template XAUUSD System
A XAUUSD System refers to a set of xauusd rules that you follow to manage your gold trades. These written xauusd rules will determine when you open a xauusd trade and when you will exit. A xauusd trade system is created by combining two or more xauusd technical indicators.
For example, the Stochastic Oscillator indicator can be combined with other xauusd indicators to form a xauusd system. For this example - stochastic oscillator can be combined with the xauusd technical indicators below to come up with the following xauusd system.
- RSI indicator
- MACD indicator
- Moving Averages indicators
Example - MetaTrader 4 Template XAUUSD System Example
Creating a XAUUSD System - XAUUSD System Trading Example
So the question is how can a xauusd trader come up with xauusd trading systems that work like the xauusd system example above and how does one write it's xauusd rules? to write the xauusd system trading rules follow the steps below.
Seven steps to creating an indicator based xauusd trading system
To come up with these set of xauusd rules we use the following seven steps.
1. Choose your Gold Chart Time Frame
This first step depends on how many hours you want to dedicate to xauusd. Whether you prefer sitting in front of the computer constantly for several hours analyzing short xauusd chart time frames OR you prefer setting up your xauusd charts using bigger xauusd chart time frames once or twice a day. Choosing a xauusd chart time frame will mainly depend on what type of xauusd trader you are.
Gold Chart Time Frames on MetaTrader 4 XAUUSD Software
While testing your new xauusd trading system you may want to find out about its performance on different xauusd chart time frames and then choose the most accurate and profitable xauusd chart time frame for you.
2. Choose indicators to identify a new xauusd trend
The goal of a xauusd trader is to get into the trade as early as possible and take maximum advantage of gold price moves.
One of the common ways to spot a new xauusd trend as fast as possible is to use Moving Averages Indicator. A simple xauusd strategy is to use a moving average crossover system that will identify a new trading opportunity at its earliest stage.
Moving Average Crossover Method
Sell xauusd signal and Buy xauusd signal Generated by Moving Average Crossover XAUUSD Method
3. Choose additional xauusd indicators to confirm the xauusd trend
Once we find a new xauusd trend we need to use additional indicators that will confirm the entry xauusd signals and give either a green light for action or save a xauusd trader from fake-outs.
To confirm the xauusd signals we use RSI indicator and Stochastic Oscillator indicator.
RSI Gold Indicator and Stochastic Oscillator XAUUSD Indicator XAUUSD System
4. Finding xauusd entry and xauusd exit points
Once xauusd technical indicators are chosen so that one xauusd indicator gives the trading signal and another indicator confirms the trading signal, it is time to enter a xauusd trade.
A XAUUSD trader should enter a xauusd trade as soon as a xauusd signal is generated and confirmed after a candlestick closes.
Aggressive xauusd traders enter a xauusd transaction immediately without waiting for the current gold price bar to close.
Other xauusd traders wait until the current gold price bar is closed and then enter the xauusd trade transaction if the trade setup has not changed and the xauusd signal remains valid. This method is more considerate and prevents additional false entries and xauusd whipsaws.
Generating XAUUSD Signals - how to Generate XAUUSD Signals.
Generating XAUUSD Trade Signals
For exits, a xauusd trader can either set an amount he wants to earn per trade or use technical xauusd tools that help to set profit goals like Fibonacci expansion tool or set a protective stop loss depending on the xauusd market volatility at any given time. Alternatively a xauusd trade can exit when the xauusd indicators give an opposite trading signal.
When opening a new xauusd trade transaction it is always important to calculate in advance how much you are willing to lose if the xauusd trade transaction goes against you. Although the goal is to create the best xauusd trading system in the world, losses are inevitable and therefore being ready to tell where you will give up and cut your losses before starting a xauusd trade transaction is very important.
5. Calculate risks in each xauusd trade setup
In XAUUSD, you must calculate your risk for each xauusd trade. Serious xauusd traders will only enter and look to open an order if the risk to reward ratio is 2:1 or more.
If you use a high risk to reward ratio like 2:1, you significantly increase your chances of becoming profitable in the long run.
The Reward to Risk Chart below shows you how:
Gold Money Management Reward Risk Chart - Example Template XAUUSD System
In the first example of Risk to Reward Ratio, you can see that even if your xauusd system only won 50% of your xauusd trades, you would still make a profit of $10,000. Read more on this xauusd money management xauusd topic: Here Gold Money Management Guidelines - MetaTrader 4 Template XAUUSD System and Gold Money Management Methods - Template XAUUSD System Example.
Before opening a new xauusd trade, a xauusd trader should define the point at which they will close the xauusd trade if it turns to be a losing xauusd trade. Some traders use Fibonacci retracement levels tool and support and resistance levels. Other xauusd traders just use a pre-determined stop loss to set stop loss xauusd orders once they have opened a xauusd trade transaction.
6. Write down the xauusd systems xauusd rules and follow them
A XAUUSD Trade System refers to a set of rules that you follow to manage your gold trades.
The keyword is ASET OF TRADING RULES which you must follow. If you don't follow the xauusd rules then you don't even have a xauusd system in the first place.
The next xauusd trading systems lesson shows you an example of how to use the above steps to come up with your own XAUUSD Trading online xauusd system:
Next Lesson: Example of Writing XAUUSD Trade Systems Rules
7. Practice on a Demo Account
Without enough trades, you will not be able to realize the true profitability of your gold trading system.
Once you have your xauusd trading system rules written, it is time to test and improve your xauusd trade system by using it on a demo practice account.
Open a free demo practice account and trade your xauusd system to see how well it will respond.
It is strongly recommended to start with a demo xauusd account and practice for at least for 1 or 2 months so as to gain some practice and experience how the xauusd market works.
Once you start making some decent profit on your demo xauusd account you can then try opening a live gold trading account and start trading with real money.