Trading Trigger Stratergy

TRADING TRIGGER STRATEGY     

• After a Downtrend. If the price closes above the moving average (M/A) and above the prior time period’s highs, with a sequence of higher highs and higher lows, enter a long position, as the uptrend is now confirmed. You will want the moving average to have formed a flat line or a higher- sloping angle. Place a stop below the lowest low point.

Closing Price > M/A = Go long or exit shorts

• After an Uptrend. If the price closes below the moving average and below the prior time period’s lows, with a sequence of lower highs and lower lows, enter a short position, as the downtrend is now confirmed. You will want the moving average to have formed a flat line or a lower- sloping angle. Place a stop above the highest high point.

Closing Price < M/A = Go short or exit longs

When trading based off the market direction number or three-period pivot point moving average, there is no need to wait for the value of the moving average to start rising or falling to determine the trigger to enter the market.

 A close above the moving average will trigger a long position, and a close below the moving average will trigger a short position. However, you want to see the moving average values follow the direction of the price move in the desired trade.