SIX STEPS

Setup Your System in Six Steps
My “So Easy It’s Ridiculous” System

In this section I will give you an idea of what a trading system should look like. This should give you an idea of what you should be looking for when you develop your system.
Trading Setup

* Trade on daily chart (swing trading)
* 5 EMA applied to the close
* 10 EMA applied to the close
* Stochastic (10,3,3)
* RSI (14)
Trading Rules
# Stop Loss = 30 pips
# Entry Rules

1. Enter long if:
* The 5 EMA crosses above the 10 EMA and both stochastic lines are heading up (do not enter if the stochastic lines are already in the overbought territory)
* RSI is greater than 50
2. Enter short if:
* The 5 EMA crosses below the 10 EMA and both stochastic lines are heading down AND (do not enter if the stochastic lines are already in oversold territory)
* RSI is less than 50

# Exit Rules

* Exit when the 5 EMA crosses the 10 EMA in the opposite direction of your trade OR if RSI crosses back to 50

Okay, let's take a look at some charts and see this baby in action...