Thanks to the feedback I’ve gotten on my blog entries about the Amazing Crossover system, I’ve come up with a new set of adjustments for another version of the forex mechanical system.
Here are the rules for the Amazing Crossover system (Version 3.0) that I plan to run backtests and forward tests on.
EMA 5, EMA 10, RSI 9, parabolic SAR (0.020, 0.020, 0.200)
Go long on the open of the next candle when EMA 5 crosses above EMA 10 while RSI is moves above 50. Short on the open of the next candle when EMA 5 crosses below EMA 10 while RSI moves below 50.
Set an initial stop of 100 pips then switch to a 50-pip trailing stop once price moves 50 pips in the trade’s direction. Close short trades when the parabolic SAR forms three dots below the price and close long trades when the parabolic SAR forms three dots above the price. Exit open trades when a new valid crossover signal is made.
As I’ve emphasized in my blog entries, I’d like to keep things as simple as possible for now so that newbie forex traders can easily try it out. I’ll be running the tests on EUR/USD’s 4-hour time frame again, with backtests spanning a year’s worth of data and the forward tests for the month of September, so y’all better stay tuned!
In the meantime, you might wanna take a look at the original and tweaked version of the Amazing Crossover system: