On Trend 2 Trading System For MT4

On Trend 2 Trading System For MT4

Please note: This strategy was publicly published in the trading community and is free to use. We do NOT make an attempt to decide if this strategy is profitable or not, because we know that the major factors regarding trading results are the skills/experience of the trader who executes the strategy. Therefore, we are mainly explaining the components and rules of the strategy. If applicable, we are highlighting advantages, disadvantages and possible improvements of the strategy.

 

The On Trend 2 Trading System For MT4 mostly uses ADX and MACD to analyze the quality of the trade signals. To find the direction of the trend, the system depends on the EMAs.

Though the system is designed to trade in all currency pairs, it better to use the system to trade the major and minor currency pairs only. By doing so, we can keep the process of trading much easier.

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The On Trend 2 Trading System For MT4

The key indicators used in this systems are:

• Exponential Moving Average (EMA) 25, 50, and 100.
• Average Directional Index (ADX) +DI AND -DI.
• Moving Average Convergence and Divergence (MACD) (5, 10, 4).

Let's see how the chart looks after installing these indicators



In every trading strategy, we should identify market direction based on specific criteria and filter out the profitable trade signals. The same theory applies to The On Trend 2 Trading System For the MT4 trading strategy.

The main aim of using the EMA is to identify the strength between the buyers and sellers. if the price is trading above the 100 EMA, it means buyers’ are controlling the price.

As long as the price is trading above the 100 EMA, we will look for buying opportunities. On the contrary, if the price trades below the 100 EMA, it is better to look for the selling opportunity as the overall sentiment of the market is considered bearish.

The trend strength will be measured by using the ADX indicator. During the bullish movement, the +DI will be above the -DI. If the price moves down, the -DI will be above the +DI.

Furthermore, we will be using the colored bars in the MACD indicator to analyze the quality of the trade signals.

 

Buy Trade Setup with the On Trend 2 Trading System For MT4

As a new trader, it is better to use the On Trend 2 Trading System For MT4 to trade the major currency pairs only. Price movement in major currency pairs is much more stable and provides better signals in the higher time frame. So, by choosing the major pairs, we can make the trading process easier.

 

Bullish Trade Condition

• The 25 EMA will be trading above the 50 EMA. And the 50 EMA will be trading above the 100 EMA.
• ADX reading should be greater than 22.
• Color in the MACD histogram should be green.

Entry

After checking these three conditions, you can take long trade with low risk.

 

Stop Loss

Since the 100 EMA will act as a strong support level, it is better to place the stop below the 100 EMA.

 

Take Profit

If you are trading in the H4 timeframe, you can close trades after gaining 60 pips in EURUSD and 70 Pips in GBPUSD. But if you intend to trade the daily time frame, you can trail the stops to maximize the profit. Try not take take any trade if the stop-loss exceeds 60 pips. And maintain a 1:3 risk to reward ratio in each trade so that you can cover up the losses with great ease.

 

Sell Trade Setup with the On Trend 2 Trading System For MT4

To keep the trading process simple, we will be looking for short trades in the major currency pairs.

 

Bearish Trade Condition

• 100 EMA should be trading above the 50 and 25 EMA respectively.
• ADX reading should lower than 22.
• The histogram bars in the MACD indicator should be red.

Entry

Execute the short trade after checking the three conditions. But do not execute the trade at the running candles as the anatomy of the candle might get changed at the last moment.

 

Stop Loss

Since the 100 EMA will be acting as a strong resistance level, it is better to place the stop loss above the 100 EMA. Try not to take the trade if the stop-loss exceeds 60 pips.

 

Take Profit

If you are trading in the H4 timeframe, you can close trades after gaining 60 pips in EURUSD and 70 Pips in GBPUSD. Those who are looking to use the trailing stops should learn its functions properly by using a demo account.

 

Trade Management Rules with the On Trend 2 Trading System For MT4

You might be using the best trading strategy but without having a strong risk management plan, you are bound to fail. Always trade with proper risk management so that you can withstand the losses.

Let's have a look at key rules for managing the risk profile.

• Ignore the trade signals when the stop loss is more significant than the take profit.
• Learn the use of trailing stop loss by using a demo account.
• It is better not to risk more than 2% of the account balance.
• Try to have faith in your trading system.
• Avoid taking the trades after the formation of a big candle.
• Learn to embrace the losing trades.

 

Conclusion

The On Trend 2 Trading System For MT4 is not a complicated trading system. The trader can master its use by using the practice trading account. While using this strategy in the real market, investors should carefully manage their risk exposure. Always be prepared to accept some losing trades even though you will do the market analysis with extreme precision. Maintain a 1:3 risk to reward ratio so that you can cover up the losses. Last but not least, learn to use this strategy in the demo trading account.

FREE On Trend 2 Trading System

Download the FREE On Trend 2 Trading System for MT4.

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Put my email on your whitelist!

 

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I'm Mike Semlitsch the owner of PerfectTrendSystem.com. My trading career started in 2007. Since 2013 I have helped thousands of traders to take their trading to the next level. Many of them are now constantly profitable traders. 

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