Triple Screen Trading System Setup

Triple Screen Setup

Step 1: First Screen

The first screen that you should analyze is the long-term chart. If you are a day or swing trader, I would recommend the daily or weekly chart. You may add the following suggestions to this screen:

·       Trend-following indicators: You may include simple and exponential moving averages, MACD Histogram or whatever you prefer to use.

·       Oscillators: You may include Slow Stochastic, MACD Histogram (also used as trend indicator) or RSI or whatever you prefer to use.

·       Fibonacci retracements

·       Trend lines

·       Support and resistance points.

Look at the most recent trend line. Is it up or down or sideways? Are the most recent candles up or down? Has the currency just bounced off recent support or resistance? This will give you a visual representation of the trend.

Figure 1 below shows you an example of how a daily chart may be set up. The black horizontal lines on the price chart indicate the Fibonacci retracements drawn from the swing high and swing low. Note that the prices bounced off the Fibonacci levels as predicted.

Figure 1

Step 2: Second Screen

The second screen that you should analyze is the intermediate chart. If you are a day or swing trader, I would recommend the 60 min chart. Simply incorporate the same stuff to the 60 min chart as you would the daily chart mentioned above.

Step 3: Third Screen

If you are a day or swing trader, I would recommend the 5 min chart as the short-term chart. This is the one that you should be constantly monitoring for short-term price actions. You may add the following suggestions to this screen:

·       Trend-following indicators: You may include simple and exponential moving averages

·       Oscillators: You may include Slow Stochastic or whatever oscillator you prefer to use

·       Support and resistance points (intraday, previous days' highs and lows)

·       Trend lines (least important)

Tips for Setup

·       You may wish to use 22-EMA and 200-SMA for the 5 min chart, and add 100-SMA in addition to these two to both the 60 min and daily chart.

·       You can use the default settings for Slow Stochastic and MACD Histogram.

·       Set different colors for your various moving averages.

·       Set different colors for support and resistance lines, and keep them consistent for all your charts (for example, blue for resistance, black for support).