123#ADX Trading System
The system started with just the Moving Average (MA) indicators and following price action. I added other indicators to help hedge my trading by showing me when a possible trend reversal or a breakout was going to occur. After much testing, I found success by keeping it simple. I paired up EMA with ADX.
The system works on any pair and time frame (TF) but for this submission, I have focused on EURUSD / M15. The M15 TF provided more trading opportunities than a longer TF. It was also less volatile than the shorter TFs.
The system uses EMA with a period of 9. I wanted a MA that would be more responsive to recent price action. The two directional indicators (DI+ & DI-) of ADX are used in conjunction with EMA to establish your Entry and Exit points.
Chart Setup
Chart: EURUSD
TF: 15 minute
Indicators: EMA9, ADX14, ATR14
Set a level of 20 on ADX14
Entry Rules
Long Entry:
Price is coming up from below EMA9. Candle Closes above EMA9
ADX DI+ > 20 AND ADX DI+ > ADX DI-
Short Entry:
Price is coming down from above EMA9. Candle Closes below EMA9
ADX DI- > 20 AND ADX DI- > ADX DI+
Exit Rules
Long Exit: Candle Closes below EMA 9-or- ADX 14 DI+ < ADX 14 DI-.
Short Exit: Candle Closes above EMA 9 -or- ADX 14 DI- < ADX 14 DI+
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