How Do You Generate Stock Signals with Trade Systems?

The only method of Stock Indices trading is through signals, It is best to learn how to generate these Stock signals for yourself, this way you don't have to rely on other Stock traders to generate them for you.

Generating signals is not easy and requires you to have a lot of technical analysis knowledge & experience, but the earlier you start practicing how to generate these Stock signals for yourself the better it is for you.

A good method of how to practice generating signals with systems is to open a free practice demo account & test your signals on this practice account risk free without risking your money, then once you have tested your strategies & they are profitable you can then use them on a live account.

The method of how to practice generating these Stock signals as well as how to back test them on the demo account using the MetaTrader 4 software is discussed below:

So, How Can a Trader Generate Stock Trade Signals?

The best method of generating signals is through systems, You can Learn how to come up with Stock systems from the lesson how to create Systems on the right navigation menu under the topics Indices Key Concepts.

A Indices system is a combination of one or two or more technical indicators with written rules of how these indicators will generate these signals.

Take an example of the simplest system or strategy known as moving average crossover method. A buy or sell is generated when there is a crossover of the two moving averages: either a buy for an upwards crossover or a sell for downwards trend.

Example of Generating Stock Trade Signals Using MA Moving Average Crossover Method

The system example below shows a system using the above moving average strategy combined with the RSI and MACD indicators to generate buy and sell Stock Indices trades.

Example of Online Trade Systems & Stock Indices Trade Strategies

When it comes to generating buy and sell signals, Indices traders should use simple Stock systems to generate these.

Generating a Stock Trade Signal - Buy and Sell Signals

Indices Trade Systems

An example of a simple Indices system that works, is one that is a combination of:

• Moving average crossover strategy
• RSI
• MACD

The written rules are:

Generating Stock Trade Signals Strategy - Indices Trade System Examples

Indices Trade Rules:

Buy Signal is Generated when:

• Both Moving averages going up
• RSI value above 50
• MACD above center line

Sell Signal is Generated when:

• Both Moving averages going down
• RSI value below 50
• MACD below center-line

Generating Buy and Sell Stock Trades - Example of a Trade Strategy

Exit Signal

Exit signal is generated when MA, RSI and MACD Indices indicator give a signal in the opposite direction.

The trade chart time frame to use is 1 hour timeframe or 15 minutes chart time frame depending on what type of trader you are.

For a beginner trader the above written rules will give goodbuy and sell Stock trade signals, the only thing that a trader needs to do is to have the discipline to follow the written Stock signals rules the exact way they are, and wait for a buy or sell Stock trade transaction to be indicated by your strategy and trade after the signals have been generated, not before they are generated.