Making a SGDJPY Indicator Based SGDJPY System

A SGDJPY System refers to a set of SGDJPY rules that you follow to manage your SGDJPY trades. These SGDJPY rules will determine when you open a SGDJPY trade & when you'll exit. A SGDJPY trade system is created by combining 2 or more indicators.

For example, the Stochastic Oscillator can be combined with other indicators to form a SGDJPY system. For this example stochastics can be combined with the indicators below to come up with the following SGDJPY system.

• RSI
• MACD
• MAs Indicator

Example

Creating a SGDJPY System - SGDJPY System Example

So the question is how can one come up with a SGDJPY systems that works and how does one write its rules? Follow the steps below:

Seven steps to creating an indicator based SGDJPY system

To come up with these set of rules for SGDJPY currency pair we use the following seven steps.

1. Choose your SGDJPY Time Frame

This first step depends on the number of hours you as a trader want to set a side to SGDJPY trading. Whether you prefer sitting in front of the Desktop computer constantly for several hours analyzing short SGDJPY time frames OR you prefer setting up your charts using bigger SGDJPY time frames once or twice a day. Choosing a charts time frame will mainly depend on what type of SGDJPY currency trader you are.

SGDJPY Chart Time Frames in MetaTrader 4 - SGDJPY MT4 Chart

While testing your new SGDJPY system you may want to find out about its performance on different SGDJPY chart time frames & then select the most accurate & profitable SGDJPY chart time frame for you.

2. Select indicators to identify a new trend

The goal of a SGDJPY currency trader is to get into the SGDJPY trade as early as possible and take maximum advantage of price moves.

One of the common ways to identify a new SGDJPY trend as fast as possible is to use Moving Averages Indicator. A simple system is to use a moving average cross-over system that will identify a new SGDJPY setup opportunity at its earliest stage.

MA Crossover Technique - SGDJPY System

SGDJPY Sell signal and SGDJPY Buy signal Generated by MA Crossover Strategy

3. Choose additional indicators to confirm the SGDJPY market trend

Once we find a new SGDJPY trend we need to use additional indicators that will confirm the SGDJPY entry signals & give either a green light for action or save a trader from fake-outs.

To confirm the signals we use RSI and Stochastic Oscillator.

RSI & Stochastic Oscillator SGDJPY System

4. Finding entry & exit points

Once indicators are chosen so that one indicator gives the signal and another confirms the signal, it is time to enter a SGDJPY trade.

A SGDJPY trader should enter as soon as a signal gets generated & confirmed after a candlestick closes.

Aggressive SGDJPY traders enter a transaction immediately without waiting for the current price bar to close.

Other SGDJPY traders wait until the current price bar is closed and then enter the transaction if the SGDJPY trade setup has not changed and the signal remains valid. This method is more considerate & prevents additional false entries & whipsaws.

Generating SGDJPY Signals

Generating Forex SGDJPY Trade Signals

For exits, a trader can either set an amount he wants to earn per trade or use technical tools that help to set profit goals like Fibo Expansion Indicator or set a protective stop loss depending on the SGDJPY market volatility at any particular time. Alternatively one can exit when the indicators give an opposite signal.

When opening a new SGDJPY trade transaction it's always important to calculate in advance how much you are willing to lose if the SGDJPY transaction goes against you. Although the goal is to come up with the best SGDJPY system in world, losses are inevitable and therefore being ready to tell where you'll give up and cut your losses before starting a SGDJPY trade transaction is very important.

5. Calculate risks in each SGDJPY trading setup

In you must calculate your risk for each SGDJPY trade. Serious SGDJPY traders will only enter look to open an order it the risk to reward is 2:1 or more.

If you use a high risk to reward like 2:1, you greatly increase your chances of becoming profitable when trading SGDJPY in the long run.

The Risk-Reward Chart below highlights you how:

Forex Money Management Reward Risk Chart - SGDJPY Trading

In the first examples of Risk-:-Reward Ratio, you can see that even if your SGDJPY system only won 50% of your open SGDJPY trades, you would still make a profit of $10,000. Interpret more on this course: Here Money Management Rules and Forex Money Management Methods.

Prior to opening a new SGDJPY trade, a trader should define the point at which he will close the open SGDJPY trade if it turns to be a losing one. Some traders use FX Fibonacci Retracement Levels and support and resistance zones. Others just use a pre-determined stop loss to set stop loss order once they have opened a SGDJPY trade transaction.

6. Write down the systems SGDJPY rules & follow them

A Trade System refers to a set of SGDJPY rules that you follow to manage your SGDJPY trades.

The keyword is A SET OF SGDJPY TRADING RULES which you must follow. If you don't follow the SGDJPY currency pair rules then you don't even have a strategy in the first place.

The next systems lesson highlights to you an example of how to utilize the above steps to come up with your own SGDJPY online system:

Next Tutorial: Example of Writing Forex SGDJPY Systems Rules

7. Practice on a SGDJPY Demo Account

Without enough SGDJPY trades, you will not be able to realize the true profitability of your SGDJPY system.

Once you have your SGDJPY system rules written, it's time to test & improve your SGDJPY trade system by using it on a SGDJPY practice account.

Open a free demo practice account & trade SGDJPY your system to see how well it will respond.

It is strongly recommended to begin with a practice account & practice for at least for 1 or 2 months so as to gain some practice & experience how the SGDJPY currency pair works.

Once you start making some decent profit on your SGDJPY demo account you can then try opening a live account & begin trading SGDJPY currency pair with real money.