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Kevin Burton

This document outlines a trading strategy that uses the 50-period moving average and stochastic oscillator to identify entry signals in trending markets. It recommends looking for pullbacks where the stochastic crosses below 20 or above 80 to signal a buy or sell, respectively. Positions should be taken when price is above or below the 50MA depending on whether it is a long or short trade. The strategy works best on shorter timeframes like 2-5 minutes where more opportunities are available. Backtesting is suggested to optimize it for different market conditions and timeframes.

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Rahul
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263 views22 pages

Kevin Burton

This document outlines a trading strategy that uses the 50-period moving average and stochastic oscillator to identify entry signals in trending markets. It recommends looking for pullbacks where the stochastic crosses below 20 or above 80 to signal a buy or sell, respectively. Positions should be taken when price is above or below the 50MA depending on whether it is a long or short trade. The strategy works best on shorter timeframes like 2-5 minutes where more opportunities are available. Backtesting is suggested to optimize it for different market conditions and timeframes.

Uploaded by

Rahul
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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1







A simple setup that works well.


Used in trending markets. (not oscillating)
In upwards trends, traders quickly panic
themselves out of positions.
Just as the are jumping out, the market is
getting ready to push higher again.
We are simply using this knowledge,
combined with price to find an entry.
3

Looking at price being in an


upwards/downwards trend with 50ma
sloping.
When price pulls back, use a stochastic
cross from below 20/above 80 as the
buy/sell signal.
When the stochastic moves to the opposite
extreme, take profit/part profit. Or if at prior
resistance/support.
Easy to back test.

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Remember, if its a long trade, price must be


above the 50ma at the buy point.
If its a short trade, price must be below the
50 at the sell point.
The ma must be sloping.
We tend to favour the 2 and 5 min
timeframes for this because they offer more
opportunities.
However, it can be tested on other
timeframes too.

20





Only take buy setups in upwards moving


markets and vice versa.
Test the trading hours you want to trade
with.
With bigger timeframes, it may need
adapting.

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Try out our live trading room free.


1st to 3rd March.
7am through to 9pm you can come in
anytime you like.
Email [email protected] with;
Full name
Address
Telephone number
22

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