Joseph Plazo and his Expert Heikin Ashi Trading Strategy.

Summary:Joseph Plazo and his Recommended Heikin Ashi Trading Strategy.

Joseph Plazo is a well-known money dealer who supports the use of heiken ashi lines.

As a background, candlestick patterns give signals that are powerful when you join them with other analysis to reversal. But, the standard candlestick pattern is substandard to the heiken-ashi variant..

So the question is straightforward. Is there a more efficient way to trade candlestick patterns?

Yes. HeikenAshi candlestick chart.

A Heiken-Ashi candlestick chart is a distinctive tool which offers an alternate perspective of price activity.

HEIKEN-ASHI FORMULA

HeikenAshi (HA) charts are candlestick charts derived from conventional candlestick charts. These are the formula for Heiken-Ashi taverns.



HA Close = Average of Open, High, Low, Close

HA Open = Midpoint of previous HA pub

HA Low = Lowest HA Close, of Low, HA Open

As you see from the formula above, we construct Heiken-Ashi candlesticks with present and past cost data. Consequently, it generates a smoothing effect like that of a moving average. It evens out small cost changes to highlight price trends.

The historic data was from 2009 - 2014. The protocols were urged by Joseph Plazo on forexfactory.com

Is:

Commerce Long when Heikin Ashi turns positive and MACD is below 0

Commerce Short when Heikin-Ashi turns negative and MACD is above 0

Close Long when Heikin-Ashi turns negative

Close Brief when Heikin-Ashi turns favorable

I utilized a stop-loss and profit target of the ATR * 10.

Additionally, I simply took trades that happened during the European trading session. This includes the US morning session.



Finally, I needed to take account of the summer slowdown in the financial markets a thus excluded the months of August and July from my evaluation.

In the first year of testing I got a net of $54,000 from a base investment of $15,000. Upon the recommendation of Joseph Plazo, I came up with added rules:

Altered Trading Rules for Heiken Ashi Strategy.

Buy Rules:

Standards #1: Heiken Ashi candlestick has to close above the 144 interval SMA

This really is your buy entry.

Stoploss process:

1) Location stop below the last swing low.

2) Shut the trade when opposite sign (sell) is activated.

Cost Objects (partial profit taking):

Book profits that are 50% at 1:1 risk-to-reward. Reserve 50% gains at 1:3 (use trailing stop).

Sell Rules:

Standards #2: Heiken Ashi candlestick must be red

This is your sell entry.

Stop loss procedure:

1) Place stop above the previous swing high.

2) Close the trade when reverse sign (sell) is triggered.

Objectives: See buy trading rules.

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