This strategy trading system implements a 30 Simple Moving Average
(SMA) and the Relative Strength Index (RSI). The strategy has no
restrictions in terms of trading days or hours. It opens orders if
certain conditions are accomplished throughout the week. To open a
buy
order, the following conditions need to be satisfied: the Last Bid
Candle Close price above the 30 SMA price and the RSI higher than 25.
To open a sell order, the following conditions need to be satisfied:
the Last Bid Candle Close price below the 30 SMA price and the RSI
lower than 75. The strategy trades EUR/USD with a default trade
amount
of 4.9M, default slippage of 5 pips, default stop loss of 400 pips
and
default take profit of 10 pips. The default trading period is fifteen
minutes (15 min) for both the 30 SMA and the RSI.
During the month May the strategy opened only buy orders. This has
been an effect of the euro being traded with a heavier bias against
the US dollar. The single currency managed to rise from nearly the
1.0850 level at the beginning of the month to nearly the 1.1250 level
at the end of the month. Macron’s election in France coupled with
weaker US fundamental data and growing views that the Eurozone turned
the corner prompted the euro to jump in May.
So, for this purpose, I present two charts, were it can be seen that:
from May the 1st to May the 8th, the 30 SMA has been most of the time
below the last candle level; from May the 9th May to May the 11th,
the
EURUSD eased and the 30 SMA moved most of the time above the last
candle level; from May the 12th till the end of the month, the euro
rose significantly against the US dollar, with the 30 SMA moving most
of the time below the last candle level, which generated a buy signal
coupled with the RSI level above 25.
I’ve started the strategy on May the 12th, the precise moment when
the EUR/USD started trending higher. And given my stop loss level of
400 pips, it allowed the strategy to stretch losses without giving up
the settled position, holding for the next wave up.