Senyum Forex Trading System For MT4
The Senyum Forex Trading System For MT4 is a trend-following forex trading methodology whose cornerstone is the hull moving average. The hull moving average, HMA, has gained popularity as a go-to moving average for trend following trading systems that give trading signals on all timeframes. However, the Senyum System has deviated from this as it is a system ideal for trading on the H1 and H4 timeframes only. Its popularity can be traced to its accurate trend forecasting due to eliminating the bane associated with other moving average types, lagging effect.
However, just like all the trend following and moving average based trading systems with a solid design, the Senyum Forex System applies to all the trading assets on an MT4. It also uses minimal trading indicators, making it a system for both the novice trader as well as the experienced trader.
OVERVIEW OF THE SENYUM FOREX TRADING SYSTEM
The Senyum Forex Trading System for MT4 uses the Hull Moving Average Indicator as its primary trading indicator in addition to the Signal alert Indicator, the large Timeframe Indicator, the DiDi Index, and the GP Trend Indicator. Let us delve deeper into these trading indicators and their role in a forex trading system that has an exotic name, maybe we will understand the motivation behind the name.
Hull Moving Average
Instead of using the invariably used moving averages in forex circles, the Senyum Forex System employs the services of the powerful Hull Moving Average, HMA, as its go-to moving average. Developed by Allan Hull, the HMA dispels the Achilles heel of the moving averages as indicators, lagging effect in relation to the prevailing market trend.
The other three common moving averages have their own algorithm of reducing the lagging effect, but it comes at a price, increased false signals and a choppy moving average. Allan Hull came up with a mathematical formula that reduces the lagging effect associated with moving averages without compromising its smoothness;
- LWMA[square root(period), (2*LWMA(period/2, price)-LWMA(period, price)].
The effect of this algorithm is a very fast-reacting moving average with filtered out market noise.
To ensure clarity in trend direction identification, the Hull Moving Average of period 144 employed by this forex trading system is colour coded;
- Dodger Blue colour to show a bullish market,
- Red colour to signal bearish market conditions.
The DiDi Index Indicator
Thanks to DiDi, born Odir Aguiar in Brazil, traders have access to the DiDi Index Indicator for MT4. Building on the concept of stochastic oscillators, this trading indicator is made up of dynamic midpoints, moving midpoints, which facilitates the visualization of price turning points in a precise manner.
Don’t fret on the explanation there. The concept is pretty simple; embed 3 Moving Midpoints of different periods, 3, 8, and 20, to oscillate around the 0 level. The visualization is of the longer period midpoints, and their crossing closest to the 0 level indicates trend reversal.
The dynamic midpoints are colour coded, a deep sky-blue one and an orange one; a cross of the orange over the deep sky-blue signals bearish market while a climb of the deep sky-blue over the orange indicates a bullish market.
The DiDi index indicator is coupled with the GP Trend Indicator.
GP Trend Indicator
This is a momentum signal indicator, and it is colour coded to show when the market is in uptrend or downtrend; blue coloured histogram bars signal a bullish move while red coloured histogram bars signal a bearish market.
It is based on the last 1000 price bars.
Large Timeframe Indicator
This indicator appears as blue and red boxes on the charts. The red boxes highlight when the market is bearish while blue boxes give insight when the market is bearish.
For the Senyum Forex trading System, this indicator is used as the primary exit signal; a long position exit when prices crossover to red coloured box while a short position exit is when prices encounter a blue coloured box.
Signal Alert Indicator
This indicator is in two, small lime and yellow filled arrows, and large hollowed lime and yellow arrows. Based on the last 500 price bars this signal indicator basis its signals on the zigzag indicator; an indicator renowned for its ability to plot the trend direction and identify trend turning points. The large hollow arrows signal bullish and bearish reversals while the filled arrows indicate entries within the major trend, both bearish and bullish.
Remember to trade with the trend at all times.
THE SENYUM FOREX SYSTEM TRADING SETUP
First, a hollow yellow coloured arrow indicating the onset of a bearish reversal.
Second, a filled yellow arrow confirms that it is time to short the market.
Third, red rectangle forms signaling bearish market conditions.
Fourth, the hull moving average turns colour from red to blue.
Fifth, the price candlesticks close below the HMA.
Sixth, the GP trend is ablaze with red histograms.
Seventh, the DiDi index indicator, orange coloured moving average climbs over the deep sky-blue moving average near the 0 level.
Enter the bearish trade on the first candle that opens and closes below the HMA.
This trade has so far garnered a 134 pips bearish rally.
First, a hollow lime coloured arrow indicating the onset of a bearish reversal.
Second, a filled lime coloured arrow confirms that it is time to go long in the market.
Third, a blue rectangle forms signaling bullish market conditions.
Fourth, the hull moving average turns colour from blue to red.
Fifth, the price candlesticks open and close above the HMA.
Sixth, the GP trend is a sea of blue histograms.
Seventh, the DiDi index indicator, deep sky-blue coloured moving average climbs over the orange moving average near the 0 level.
Activate a bullish trade on the first candle that opens and closes above the HMA.
This trade garnered 187 pips before the exhibition of exit parameters.
Stop Loss and Take Profit Level
Use a stop-loss of 10-15 pips below the HMA the point of entry.
For exit use, the counter coloured large timeframe price box to the position held or the HMA colour change to exit.
Download the complete system description and the files here: