Indices Strategy Rules: Write Down The Rules & Follow Them

We shall use the previous steps to create a written system that generates the trade signals displayed below using the 1 hour chart. We shall use the 1 hour chart to write the rules of this strategy - tradingtrade system.

A strategy refers to written set of written indices rules which you follow to manage your trade transactions. These rules must be written down so as to guideyou. The following tutorial will show you how to writedown the rules of your tradingtrade system.

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

Example of Trading System below:

Writing Rules of a Strategy Method

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

You can come up with the above system using steps below:

Step 1:

Choose your Time-frame - 1 hour chart

Step 2:

Choose Indicators that spot a new trend - MA Crossover System.

Step 3:

Select Technical Indicators that confirm the market trend - RSI, Stochastic

Step 4:

Finding entry and exit points
Long Entry
Both MA pointing up
RSI above 50
Stochastic oscillator trading going up
Short Entry
Both Moving Average pointing down
RSI below 50
Stochastic oscillator trading going down
Exit
MA generates opposite signal
RSI generates opposite signal

Step 5:

Calculating risks in every trade - 20 pips

Step 6:

Write down the trade system Indices rules

Step 7:

Test the system on a practice account

After following these guidelines we develop written indices system rules below.

Writing System Indices Rules

Example of How to Write the Best System Rules

This system produces the signals as pictured below. Using these rules traders can determine when to enter & exit trade transactions.

Generate Buy & Sell Indices Signals using Written Indices Strategy Rules

Generate Buy & Sell Indices Signals using Written System Rules

We have finished writing the guidelines, if you're researching on how to create the best system, this tutorial is a good begin to lesson you on how to do just that. This is one part of a the indices plan. Now how do you as a trader develop a complete indices plan? To read about Indices plan tutorial go to the right navigating menu of this website under key concepts where you can find a link for this trade plan topic.

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Trade Stock Indices

Indices Strategy Rules: Write Down The Rules & Follow Them

Example of Trading System below:

Long Entry

Short Entry

Exit

Writing System Indices Rules