How to time your trades. A 3 steps tutorial.

Whenever you are an investor or a speculator, surely you have wondered, at leat once, How to time your trades.

The answer to this question, once again, is Trading Cycle.

WHY? Because the Trading Cycles not only give you a systemic way to identify the Market Trends and Support & Resistance but, also, they give you the possibility to forecast WHEN the market will turn.

In this article you will learn How to time your trades in 3 easy steps:

  1. Identify the trend.
  2. Calculate the reversal timing.
  3. Time your trades!

Let’s start!

Trend Identification

This is the basic of all the strategies. Without a trend the price doesn’t move and no movements mean no money.

What you must do is to choose a method to identify the trend and trade in that direction. You can choose between:

  • Moving averages. (Price > MVA: Bullish trend; Price < MVA: Bearish trend).
  • Stochastic. (K compared with D or 50),
  • Trend detector Indicator.

Time your trades trend

The best Cycle for the trend identification is the 192 periods or greater.

Calculate the reversal timing

Now that you know the direction of the longer cycle, it’s the time to calculate the next probable reversal time using a smaller cycle.

In a bullish trend you will expect to find bullish sub-cycle. The main rule says:

In a bullish cycle, the rise should last more than the decline. 

This happens because when the cycle is bullish the high will be in the SECOND half and there will be only 2 bearish waves.
When the cycle is bearish the top will be in the FIRST half and the waves
down will be 3.

time-your-trades-time

To calculate the reversal timing you will need to:

  1. Take the duration of the cycle you’re using.
  2. Divide it by 5. (number of waves)
  3. Multiply the result for 2. (correction waves).

At this point you just need to add this value to the DATE of the last maximum if the trend is bullish, or to the last minimum if the trend is bearish.

Let’s see an example.

In this situation I’m using the cycle 192 periods as trend detector and the cycle 24 period as sub-cycle.
Using the formula shown above the standard time between a top and the next minimum should be 10 periods (24/5*2).

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This indicator counts the periods from the last minimum or maximum.
As you can see the minimums followed the standard timing for most of the times.

The Cycle Timing indicator will be available for all the Premium Users during the next week! Become a premium user!

Time your trades

The last step in order to time your trades is to use your new instrument to increase the %Win of your signals.

You can do this by combining it with one or more signals, for example:

  • Support & Resistance.
  • Trend Line.
  • Divergences.

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