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Skydive Trading System: A Lowry System Variation

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Introduction

The Skydive System is a trading system based in the strategy created by Scott Lowry (see the Lowry System), an American psychologist and trader that regularly speculate in the Futures market. Basically, this trading technique is based on the intersection of three exponential moving averages as shown in the image:

In the same way as happens with other similar trading strategies based on moving averages, in markets with low volatility and without a defined trend, the Skydive System often produce  false signals. For that reason we can include a filter based in indicators like the MACD or the Williams %R.

This is a simple trading technique based in moving average crosses. It is based in the famous trading system developed by Scott Lowry, so is basically a trend follower strategy. For that reason is no recommended in markets that are moving in a range without a clear trend.

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Harmonic Patterns in Trading

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Chart patterns known as harmonic patterns are undoubtedly one of the classic patterns which have been studied by many traders throughout their training within technical analysis. By mastering these types of price patterns, the use of this type of technique can provide early entries with a minimum of risk very near to price levels where there are trend changes. Harmonic patterns can be observed in any market.

For the short term, day traders can use this type of pattern in an effective way to buy and sell when the price touches an area of daily highs or lows. Gartley, the discover of this patterns, stated in his work that to buy or sell properly within a pattern of the type “AB = CD” (the best known among us) the market must be on a strongly established trend.

A change in a market trend or a strong correction may not always follow this pattern but you can even make profits by trading this price formation with proper money management and risk management in each trade, which requires some experience.

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Capital Index Broker

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Capital Index-Broker Review Capital Index is a regulated Forex and CFD broker from United Kingdom (is regulated by the FCA) that offers a lot of services and markets to trade from Forex to financial spread betting. It is an ECN/STP broker with multiple services for its clients.   It is a company that provides financial services to both novice traders … Read more

Williams %R Indicator – Definition, Calculation and Uses

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Williams %R indicator is an oscillator of technical analysis, for which it works better in lateral trending markets that in those with a strong trend. Basically what it does is measure how close to the maximum or minimum of a certain period of time the prices have closed during the last trading session or during any other time frame chosen by the trader. Remember that like other indicators, it can be used to analyze different periods of time from few minutes to hours, days, weeks, etc.. It was developed by  Larry Williams.

To apply this indicator the trader must select the time period, which is usually 14 periods (but that depends of the trader´s needs). In this case 14 is one of the most common value of this parameter but it  be changed if the trader believes that he will have better results with other values. If the trader is analyzing the market development over a period of 1 or more days, the Williams% R indicates if the closing price of the last session is close or not of the maximum or the minimum of the last 14 sessions.

The idea is that when asset prices are analyzed in a market that is moving in a sideways trend (a trend with no clear direction), the fact that during the last session the closing price is near the maximum or minimum of the last 14 days may be an indication that  is approaching the moment when the market could change its direction and go up or down. In short, if the market is in a sideways trend and the closing price of the last session is near the maximum of the last 14 sessions, probably the price will fall and if the closing price is near the minimum, there is a high probability that the price is going to rise.

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Average Directional Index (ADX) Indicator

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The ADX is an oscillator-type technical indicator that fluctuates between 0 and 100 and whose value is based on the true range of movement (TR, true range). The ADX was developed by Welles Wilder in order to obtain information about the strength of the current trend and determine if the market is in a clear trend or in a range. Additionally, the ADX also serves to inform the trader about the prevailing trend of the market through the positive/negative movement indicators (+ DI and -DI).
 
The ADX is the abbreviation of the name Average Directional Index. When this indicator is applied to a chart we can see three lines:
  • The line + DI (Positive Directional Indicator).
  • the line -DI (Negative Directional Indicator).
  • The ADX line.

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HighLow – Binary Options Broker

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Review of the Binary Options Broker HighLow HighLow is a regulated binary options broker (ASIC of Australia) founded in 2013 with thousands of clients around the world. This company offers the possibility to trade with various types of options based on many underlying assets including currency pairs (Forex), commodities, stock indices and stocks of various markets.    This broker has … Read more

Lowry system – Trading system based on moving average crossovers

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What is the Lowry System? This is a trading technique developed by a trader named Scott Lowry and is based in moving averages crosses. Before starting the description of the strategy we will describe 3 basic concepts: Delphic Phenomenon (DF): This phenomenon occurs when the moving average of 18 periods and the moving average of 40 periods cross each other upwards (or … Read more

The Moving Averages in Trading

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Moving Averages – A Renowned Tool Trading These days, several tools and strategies are in use by Forex traders in order to make more profit. If a beginner trader is trying to enhance the profit margin in the Forex market and other markets too, then he should consider these tools and strategies. One of the most important of these tools … Read more

Vegas Tunnels Trading Strategy for 1 Hour Charts

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This is a trading system developed by Vegas to trade only in 1 hour price charts. Basically this trading technique is to open three equal positions (if the trading platform permits the trader can also open a position divided into three parts which can be closed independently). Another option is to divide the capital invested in the trade according to percentages, for example the first position corresponds to 50%, the second position to 25% and the third position to 25%. Each trader can decide how to work with each position.

It can be used in many markets, including Forex (any currency pair), precious metals (gold and silver), indices and other.

The methodology of this system is quite simple. Initially three exponential moving averages (EMA) are plotted on 1 hora chart:

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FXOpen Aus Broker – Review and Services

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FXOpen-Forex Broker Review FXOpen Aus is a regulated Forex broker (is regulated by ASIC) from Australia which offers excellent trading conditions thanks to its ECN/STP order execution for the Forex market. This company was founded in 2012 and allows to trade with currency pairs (Forex spot) and precious metals in the spot market. Type of broker FXOpen AU is a … Read more

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