How many indicators should there be on a chart? Different or similar? We are sure that none of the professional traders will answer this question. Graphics congestion is “grief from the mind”, professionals see entry points literally according to 1-2 signs. But on the other hand, if you impose several indicators of the same type with different periods, then the problem of selecting parameters is automatically solved – there are ten lines on the chart, choose any.
In a recent review, we have already cited the example of a strategy based on stochastics. And even considered a channel strategy based on 8 sliding. Guppy strategy is also a sliding-based strategy, but unlike the channel version of their application, the principle here is more like stochastic ropes.
- Important! The strategy does not guarantee the result. This is the base from which to make a start when forming a trading system. The review describes the general principle of using Guppy sliding methods, periods can be changed for optimization, additional indicators are added – all at the discretion of the trader.
Sliding Guppy Strategy
Fish is absolutely nothing to do with. The author of the strategy is the Australian trader Daryl Guppy. It is interesting that for some reason he recommends its use in binary options, although it is quite working for Forex. It is based on two types of sliding – a group of fast and slow MA. Signals are formed by the intersection of simple moving averages (beam formation and its further divergence), lateral movement is easily eliminated.
Trading Conditions for Guppy Strategy:
- Timeframe – D Long-term strategy, reducing the interval is not recommended.
- Fast (red) sliding SMAs with periods of 3, 5, 8, 10, 12, 15.
- Slow (blue) sliding SMAs with periods of 30, 35, 40, 45, 50, 60.
Conditions for opening a long position:
- Slow sliding upward. The second basic condition is that they should go in order, starting at 30 and ending with the 60th MA. Lines should not overlap. This suggests that there is a strong trend in the market.
- Fast sliding also lined up, periods – from 3 to 15 (in sequential order). This is a confirmation of the end of the correction and the appearance of a trend.
Once both conditions are met, we wait for the signal candle to close and place a Buy Stop pending order at the highest point of the previous signal bar with a stop length of 70-100 points on a new candle. As soon as the fast traders begin to intersect, we close the deal completely.
Conditions for opening a short position:
- Slow moving downward. The second main condition is that they should go in order, starting at 60 and ending with the 30th MA. Lines should not overlap.
- Fast sliding also lined down, periods – from 15 to 3 (in sequential order). This is a confirmation of the end of the correction and the appearance of a trend.
The condition for opening a transaction is mirror-like (with the installation of a pending Sell Stop).
To optimize the Guppy strategy, it makes sense to work simultaneously on several pairs (diversification of risks). Also, the signal candle should not be surrounded by slow gliding or cross fast MAs. We hope the strategy will interest you. Share your impressions in the comments!