Quantum Trading Strategy

By Tim Grant

Reviewed By Indrajit Mukherjee

www.stockmaniacs.net
Most new traders just do not like to wait for a complete and perfect trade to take place.
These types of short term traders would be very happy to get into multiple trades per day
for 10-15 pips profit for each trade. Rather than opening one trade per day and wait until
price hits the 100+ pips target.

Momentum trading or short term system is the best index, commodity or forex trading
strategy that they can use. But with the Quantum system we are also going to include
medium term or long term trading as well. The reason for that is while short term trading
is the favorite strategy for new traders, they won’t be beginners forever! And soon they
will feel the need to trade more professionally for larger profits.

Short Term Trading

Time frame: Best to be used with 5M , 15M , 30M and 1H time frames.

Indicators used: 24 EMA (exponential moving average) and 124 SMA (simple moving
average) and AO (Alligator Oscillator)

Trading rules: When the 24 EMA cross above the 124 SMA, wait until a blue bar is
formed above or below the 0 line of the A.O indicator – best if it’s above the 0 line.
When that happens, open a BUY Order and set your stop loss at the last support level.
Your exit sign would be a red bar formed above or below the 0 line of the A.O indicator.

The opposite conditions are used for sell orders. When 124 SMA cross the 24 EMA, wait
until a new red bar is formed above or below the A.O indicator. Best if it’s below the 0
line. When that happens, open a sell order and set your stop loss at the last resistance
level.
Your exist sign is when a new blue bar is formed above o below the 0 line of the A.O
indicator.

Long Term Trading

For long term trading we are going to apply almost the same rules with few changes.

For sell orders, only sell when the red bar is formed below 0 line + 124 MA cross above
24 MA. And only exit when a blue bar is formed above the 0 line + 24 MA cross above
124 MA.

And for buy orders, only buy when the blue bar is formed above 0 line + 24 MA cross
above 124 MA. And only exit when a red bar is formed below 0 line + 124 MA cross
above 24 MA.

The above example is shown in Metatrader (MT4) platform, but the same theory can be
applied to other charting platforms like Amibroker. AO indicator for Amibroker can be
downloaded from here.

More formulas and strategies are welcome from your side. You can send Metastock,
MT4 and Amibroker formulas to stockmaniacs@ymail.com. If we think the formula is
worth publishing the same will be published here. If possible also send your screenshot of
the indicator.