Perfect Trading System for Beginners!

A community member sent in a strategy that was found on ForexFactory. The strategy was just for how to enter the market and did not include where to place the stop and take profits, which is the most important part of any trading system. I used this entry method and created a complete trading system around it. I was shocked by how effective it turned out to be. In addition, it seems to do well in consolidating markets.

In addition to reviewing the indicators, providing exact entry rules, defining the take profit and stop loss levels, testing it for 100 consecutive setups, reviewing the results, discussing the equity curve, and scoring the system on a scale of 1 to 10, I also share my 6 optimization tips that you can try in your own trading system development. Do not neglect back and forward testing, that is critical.

⏱️ Timestamps ​​⏱️
00:00 - Start
00:39 - Indicators
01:59 - Long Examples
04:04 - Short Examples
05:42 - Results, Equity Curve, Score
06:58 - Optimization

⚙️ System Specifics ⚙️
📛 System Name: Trend Cycle II
🏆 Trader’s Landing Score: 9
🎹 Instrument: Euro vs. US Dollar (EUR/USD)
⌛ Time Frame: 4-Hour (H4)

👀 TradingView Indicators
Name: Heikin-Ashi Candles
Inputs: Default
Style: Default
By: TradingView Built-In
Link: https://www.tradingview.com/support/solutions/43000619436-heikin-ashi/

Name: Moving Average (MA)
Inputs: Length: 50
Style: White
By: TradingView Built-In
Link: https://www.tradingview.com/support/solutions/43000502589-moving-average/

Name: Exponential Moving Average (EMA)
Inputs: Length: 25
Style: Orange
By: TradingView Built-In
Link: https://www.tradingview.com/support/solutions/43000592270-exponential-moving-average/

Name: Stochastic RSI
Inputs: Default
Style: Default
By: TradingView Built-In
Link: https://www.tradingview.com/support/solutions/43000502333-stochastic-rsi-stoch-rsi/

Name: Bollinger Bands
Inputs: Default
Style: Remove Basis
By: TradingView Built-In
Link: https://www.tradingview.com/support/solutions/43000501840-bollinger-bands-bb/
☝️ Long Entry (Enter on standard Japanese Candle Sticks)

1. 25 EMA over the 50 SMA.
2. Price retraces into the bottom Bollinger Band (HA-Candle).
3. Price disengages from the bottom Bollinger Band (HA-Candle).
4. Stochastic RSI closes below the 20-line, and then closes in an upward direction.
5. Green Heikin-Ashi candle.

👇 Short Entry (Enter on standard Japanese Candle Sticks)

1. 25 EMA under the 50 SMA.
2. Price retraces into the top Bollinger Band (HA-Candle).
3. Price disengages from the top Bollinger Band (HA-Candle).
4. Stochastic RSI closes above the 20-line, and then closes in a downward direction.
5. Green Heikin-Ashi candle.

🔥 Risk to Reward: Dynamic

🛑 Where to place stop-loss:
For Longs: Previous swing low.
For Shorts: Previous swing high.
🚀 Where to take profits:
For Longs: First red Heikin-Ashi candle, while in profit.
For Shorts: First green Heikin-Ashi candle, while in profit.
Link to original ForexFactory post: https://www.forexfactory.com/thread/1134457-trend-cycle-entry

⚠️Disclaimer: This content references opinion and is for information purposes only. Not intended to be investment advice.