TW System is a Forex Trading Strategy that uses a Trend Following Strategy. This system is based on 15 different indicators. The system itself is quick to learn and extremely easy to implement, even if you are completely new to trading.
It uses several momentum and moving average-based indicators to form an advanced trend following strategy. This system closely monitors the market trends, plots the trade signals within the trend directions, and produces exit signals for its users.
It can be applied to all currency pairs and is best on Major currency pairs. When it comes to timeframes, It works best on the M30 and 4-hour timeframes. These timeframes usually produce the best results. However, the TW System can be traded on all other timeframes with similar success.
This Forex Trading Strategy is entirely manual. The indicators produce the signals, but any decisions to enter the market and to set protection stops or profitable exit stops will depend on the trader. Therefore, the trader must be familiar with the principles of risk and reward and use initial support and resistance areas to set entries and exits.
Trend Following Indicator can give you trading signals you can take as they are or add your additional chart analysis to filter the signals further, which is recommended. While traders of all experience levels can use this system, it can be beneficial to practice trading on an MT4 demo account until you become consistent and confident enough to go live.
Indicators Used in this Forex Trading Strategy
The Forex Trading Strategy uses 15 custom-made indicators. Here are some of these indicators explained.
- Snake & T3 Moving Average: These two indicators intersect and produce crossover signals. The snake above the T3 Moving Average represents the bullish crossover, and an opposite scenario will be considered the bearish crossover signal.
- Support/Resistance & Pivot Custom: Both indicators define the event areas of the market. Support/Resistance levels are plotted for short-term trading and Pivot Custom for intraday and longer-term trading purposes.
- AFL Winner: AFL Winner is a momentum indicator used to indicate the overbought/oversold conditions of the market. Its value near 11 represents the oversold conditions of the market, and if it reaches near 95, it is considered as the market’s overbought condition.
- Trend Session, xSuper Trend & FSP: All these three indicators work similarly to identify the market trends. All the bars of these indicators turn yellow when the trend is bullish and transforms into red to signal the bearish momentum of the market.
This MetaTrader 4 Trading System can be used on any Forex currency pair and other assets such as stocks, commodities, cryptos, precious metals, oil, gas, etc. You can also use it on any time frame that suits you best, from the 1-minute through to the 1-month charts. Work best on M15 or H4 TimeFrames.
Trading rules for this Trend Following Strategy
As always, to achieve good results, remember about proper money management. To be a profitable trader, you must master discipline, emotions, and psychology. It is crucial to know when and when not to trade. Avoid trading during unfavorable times and market conditions like low volume/volatility conditions, beyond major sessions, exotic currency pairs, wider spread, etc.
- The snake moves above the T3 Moving Average.
- Price is supported by the lower Support/Resistance or the Pivot Custom levels.
- AFL bounces upwards from its oversold level
- Trend Session, xSuper Trend, and FSP turn yellow at the same time
- Buy triggers when all of the above conditions are met
- The snake moves below the T3 Moving Average.
- Price is resisted by the upper Support/Resistance or the Pivot Custom levels.
- AFL drops downwards from its overbought level
- Trend Session, xSuper Trend, and FSP turn to red at the same time
- Sell triggers when all of the above conditions are met.
Any positions with this Forex Trading Indicator can be liquidated using a fixed profit target. Alternatively, the profit target should be set using previous support, resistance, or high-low level as a reference point. You may also exit the trade manually if the conditions of the system reverse (the opposite signal appears).
- Exit long whenever Snake and T3 Moving Average plot the bearish/bullish crossover signal.
It is recommended to use a stop loss. Set SL below the entry price using previous support/resistance as a reference point Or on the previous high/low swing. Using fixed stop loss settings without any reference points is not advocated.