As we said in our previous article, we can classify trading systems into two groups: those based on models and those based on exploitation or data mining.
In this article we will discuss in detail the systems of the first type, defined as those who propose a model to represent the behavior of the market and from it, try to get benefits.
The algorithms that are part of this group are usually very simple in terms of the rules they use, although its development is usually relatively complex depending
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Although you probably have already noticed it, the trading systems are evolving and becoming increasingly technical. As you can imagine, some professional traders recommend to make a qualitative leap and try to convince once and for all that the use of trend lines, price chart patterns and obsolete oscillators in the same way that comes in thousands of books it is not exactly the best approach to winning in trading. I know this is a very broad and intense debate and that many people are not quite agree, but I plan to present new ways of seeing trading that
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A type of trading strategy that has been used for some years to trade successfully in the Forex market and with other financial instruments is based on moving averages tunnels such as the Vegas systems. In summary these are discretionary systems for swing trading which are based on moving averages envelopes. To better understand how works this type of strategy we will explain in detail a system known as Vegas Wealth Builder.
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What is hedging?
Hedging involves making an investment in order to reduce the risk of an adverse movement in an asset in which has been made the principal investment. A typical example in Forex would be, for example, buying EUR/USD as main investment and cover with a purchase in USD/CHF because these two pairs have a high negative correlation and buying USD/CHF reduce the risk of a buy position in EUR/USD as our main investment.
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Certainly the approaches to trade in the financial markets are numerous and varied. Many traders base their strategies on the fundamentals of supply and demand while others use more technical tools such as moving averages, price oscillators and other. In this article we study an interesting approach based on market momentum interpreted through the RSI indicator.
First of all we will indicate that the markets are indeed driven by changes in supply and demand. However, these
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This trading system was primarily designed to trade in extended time frames (4 hours later). It is based upon the breakout of a dynamic price channel which is calculated through the highs and highs of the price bars. In this sense, the strategy seeks to enter the market after two events occur:
The bullish or bearish breakout of the price channel. A retracement movement of the price after the channel breakout. After this setback, the
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