How often do you use moving averages (MAs) in their trading systems?
How many times have you heard that the moving average is not a good indicator, as they are too much “lag”?
We will show you that, thanks to an innovative analysis of moving averages can be profitable, even using only them. This template forex strategy Spaghetti FX, which is based on the respect of several moving averages.
Was taken very good idea representing the two sides of the market: long-term and short-term trades trades. With two sets of moving averages with different periods, we can clearly see how they are displayed. But it is not easy to trade, as they are purely graphic representing the two sides. And it is not easy to understand when there is an opportunity for input, output, trade or not to trade.
Therefore, to read their indisputable manner has created two new indicator.
It is important to emphasize that these indicators are not redraw and are based on a single currency and a single term, so they can be easily verified.
These two indicators – Spaghetti FX and Spaghetti FX signal.
Spaghetti FX indicator is synthesized from two types of moving averages: fast and slow.
In forex indicator Spaghetti FX we have 4 elements:
Red Line (Fast MAs)
Spread the red moving average. If the red line is below 0, then the red MAs points down (short positions). Conversely, if they are above the 0 indicates that we will open long positions.
Blue Line (Slow MAs)
As above, but for the blue moving average. If the blue line is below 0, then blue MAs points down (short). Conversely, if they are above the 0 line, indicates that they are long.
Light gray histogram (Spread)
shows the gap between the two sets of moving averages. Than it is wider, the stronger and more stable trend. It can also be used as an indicator of a trend. Above 0, we have a bullish trend, below 0 bearish.
Dark gray histogram (Amplitude)
shows the overall spread of the two sets of moving averages. MAs from fast to slow.
But to make it even easier, has developed a real trading system around this indicator and prepared an additional indicator that is incredibly easy to read and gives very good I / O signals, which can not be misunderstood.
Reading indicator signals Spaghetti FX, the market can be divided into 4 conditions:
Bold blue – a strong bullish
Blue – bovine
Red – bear
Bold red – strong bearish
With forex indicators Spaghetti FX, you will be able to understand that the two major market participant (long-term and short-term trades) do and how they relate to each other. Agreed or not.