Indices Trade System Rules: Write Down The Rules & Follow Them

We shall use the 1 hour trade chart to write the rules of this strategy - Indices system.

A Indices system refers to written set of written rules that you follow to manage your trades. These rules must be written down so that as to guide you. The following learn trading tutorial will show you how to write the rules of your system.

The key-word is SET OF Indices RULES which you must follow. If you do not follow the rules then you don't have a system. Indices systems must have rules which are written down within your plan.

Example of Trade System below:

Writing Down Rules of a Trade System - 1 hour Trade Chart Time frame Trading

You can develop the above system using the steps below:

Step 1:

Select your Chart Time Frame - 1 hour trade chart

Step 2:

Choose Indicators that identify a new trend - Moving Average Crossover System.

Step 3:

Select Indicators that confirm the market trend - RSI, Stochastic

Step 4:

Finding entry and exit points

Long Entry

1. Both Moving Average pointing up
2. RSI above 50
3. Stochastic oscillator going up

Short Entry

1. Both MA pointing down
2. RSI below 50
3. Stochastic oscillator going down

Exit

1. Moving Average gives opposite signal
2. RSI gives opposite signal

Step 5:

Calculating risks in every trade transaction - 20 pips

Step 6:

Write down the trade system Indices rules

Step 7:

Test the system on a practice account

After using these guidelines we develop a written system rules below.

Writing Trade System Rules

Example of How Do You Write the Best Trade System Rules

This system produces the signals as is shown below. Using these rules traders can determine when to enter & exit trades.

Generate Buy and Sell Signals using Written Stock Indices Trade System Rules

We have finished writing the rules, if you are researching on how to create the best system, this learn trading tutorial is a good begin to guide you on how to do just that. This is one part of a the plan. Now how do you as a trader develop a complete Indices plan? To read about FX plan tutorial go to the right navigation menu of this web site under key concepts where you can find a link for this trade plan lesson.