I decided to field test the indicator first by doing paper trades in a simulated account.
Take a look:
After the EURUSD breakout on Friday, I saw weakness when Sunday came around. 15 minute charts have a bull trend intact, but 5 minute charts had a ribbon cross. ADX bottomed out confirming momentum and -DI crossed about +DI. TrendStrengthA dipped below 60, and Parabolic SAR remained above confirming a short-term downtrend. I entered a short at .61, and set a Limit to cover at .40 with rising support. Notice prices reacted all the way down to .25 and then bounced back, confirming .40 as a short-term pivot point. Total profit was +20 pips. Notice if I had let Parabolic SAR stop me out, I would have exited around .44 (pretty close to .40).
I made a EURUSD trade late on Friday that was initially profitable but turned against me. Let's see what I did wrong there and how this system can help:
The figure should explain everything I did wrong, but most importantly:
1. Not locking in profits
2. Horrible, very bad second entry
3. Remaining short when the trend clearly changed
