murrey math trading strategy afl

13 Those Religious belief Lines v 2.0 – Murrey Mathematics Lines

Murrey math lines (MML) is a comparatively new trading indicant showing supports and resistances, and helps in finding trends and slue changes. The indicator was developed by T. Henning Murrey and has some similarity to Fibonacci retracement and pivot points. MML was created based connected the observations of Gann studies and is a simple way to carry out Gann.

Murrey math lines comprise 9 equidistant lines which run parallel to unitary another. MM lines from the bottom are at the levels 0/8, 1/8, 2/8, 3/8, 4/8, 5/8, 6/8, 7/8 and 8/8. 0/8 is the oversold line of work and 8/8 the overbought line; these are the hardest lines to cross and around 75% of the metre, the crossing triggers price transposition. The orbit 'tween 3/8 and 5/8 is the normal trading range and price tends to consolidate at these levels before dropping (3/8 short letter) or future (5/8) beyond this trading range.

Care Fibonacci retracements, when the damage is between two lines, the upper note is well-advised as resistance and lower line of merchandise is considered as support. When the toll rises in a higher place 5/8 and touches 6/8, it has a propensity to reversion to retest the 5/8 level before gallery senior high school. The identical is also applicable to downtrends; the price tends to reverse to retest the 3/8 level before heading down.

Credit for this definition : NobleTrading

Caveat: Murrey Mathematics lines are a set of support and resistor lines and like any such line are NOT prognosticative. Which means that when you trade with these lines, there is a risk inherent in the trade, which is mitigated by the "likelihood" of price moving in the direction suggested by Murrey. Hence, any trading strategy supported happening Murrey Math lines or MML must have a strong peril direction or stop loss overlay to obviate losing capital

13.1 Murrey Math Lines – Understanding the Levels

This graphic illustrates the following:
8/8: Hardest line to rise above (overbought)
7/8: Fast inverse line (weak)
6/8: Pivot reverse line
5/8: Upper trading range
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4/8: Major reversal line
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3/8: Depress trading range
2/8: Pivot reverse line
1/8: Fast reverse melodic line (weak)
0/8: Hardest line to fall below (oversold)

13.2 Murrey Math Lines AFL

The Murrey Math AFL is described here, every bit this is a major improvement on the AFL commonly found on the network. The AFL provided here is goes far beyond the original Musical octave logic. The primary features of the AFL are as follows:

Normal positional trading settings : You can use 32 or 64 period rolling look game for the highs and lows for the MML to be aforethought. Second-best suited for positional trading.
Intraday settings : Choose these, when you trade intraday. The system then draws MML victimisation the highs and lows of the day only. Outdo for altogether intraday timeframes.
Pattern Recognition: This has been added, so that you sack trade with more certainty. As you cognise MML's are just support and resistances, we involve some confirmation happening the practical direction of the next move.

An important feature of this AFL is that IT shows the historical movement of the MML levels, which to my knowledge no other software available elsewhere provides. This gives additional information for apparent motion of the support and resistance levels which can beryllium used in your trading scheme.

Also included is pattern recognition, which helps high probability trade first appearance setups.

The near powerful feature of this AFL is the predictive level. What if price moves above the +2/8 level (that is the boundary of the current fourth dimension frame) or waterfall below -2/8 level which are two octaves above and infra the accepted levels (0 and 8). The +2/8 and -2/8 levels are marked in the chart below. Some analysts too refer to them A 10/8 or -2/8 levels. And logically, its possible to drawing card 9/8 and -1/8 levels too.
13-11-2011 Modififed Murrray Math AFL to show important supports and resistances in the title thus that they can be used as targets on with Clarence Day highs and lows.

murray_maths_with_patterns_modified_intraday.afl
Register Size:	16 kb
File Typewrite:	afl

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See the two graphics. The first one on the port is for intraday periods. And the next one below is through on a 32 period rolling basis. Choose the grade-appropriate parameters in the parameter boxes.

What if you wanted to project what would happen to the levels if damage affected to 5400 or to 5225?

Shield-shaped, draw a horizontal line with the Amibroker draw tool and rename it to Improving in its properties package and drag it to the price index preceding the current time frame. This is shown infra. And voila! you have the MM lines change their context immediately.

Do the aforementioned for the lower price targets.

With this you rear end project the likely new support and resistance levels and thu the potential targets for your trades. More on that later.

13.3 Price Acoustic projection along the AFL. What if?

You want to task what leave pass off if the price moves to 5400 and to 5200.

Draw the violent dotted logical argument equally shown in the second graph and drag out it to the price take down 5400. Then right click and in the study Idaho drop down choose Upbound. Thats it!

Similarly when you want to project the MML at 5200 draw another line operating room drag the current line below to 5200 raze and choose the subject area ID DN in the drop down.

This gives you an first-class way to set targets and look at new support and resistance levels.

13.3 Trading with Murrey Math Lines – Safe trading

Since MML's are only support and resistances, you need to use them with high probability setups.
Here is an approach for uninjured trading. Hold back for a significant high or low for the 24-hour interval (unless its a countertenor or low at open of the sidereal day) and look for a act away from 8/8 Beaver State 0/8.

If the advanced of the day is apparently happening open and the price starts to fall below 7/8 from 8/8 level, breakable the scrip ensuring your stop loss is in situ. Look for a 1:2 or 1:3 return happening your stop loss entry. Likewise for contralto of the Day you would enter a long on cross of 7/8 and confirmation bars in a lower metre frame.

If the cost corset at 4/8 equal, wait for price action to move to 7/8,8/8 and with a reversal short with end loss or if IT moves to 0/8,1/8, wait for volte-face (and its a high operating theater low of the day), enter your trade with ensuring a stop loss is in situ.

Intraday trades: use the 5 minute of arc charts with Intraday parameter settings and utilise 1 or 2 minute charts for checking confirmation bars for the way of your trade before ingress.(Beaver State any other method for vogue confirmation such as MA crossovers).

Point trades: use an hourly Oregon 2 unit of time chart and apply 30/15 minute charts for trend confirmations. For trading on daily charts, use the hourly charts for confirmations.

At one time a trend forms, exit on targets using the steady stick out method acting and tracking closure losses.

Use the patterns recognition sport when trading point to improve success of trades.

Caution: Always ensure stop losses are in place, as MML are only supports and resistance and do not throw predictive capability!

Should you have some suggestions or contributions, please write to me at abnash1978@yahoo.conscientious objector.uk or post you comments in the forum
or at www.inditraders.com/technical-analysis/5434-learn-technical-analysis.html

13.4 More submissions

Check below. Documents connected exercis of the MM levels and alternative excel level calculator.

gann_-_enthios_calculator.xls
File Size:	61 kilobyte
File Type:	xls

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Disclosures danamp; Disclaimers: FUTURES TRADING IS NOT SUITABLE FOR EVERYONE AND PAST PERFORMANCE IS Non NECESSARILY INDICATIVE OF FUTURE RESULTS. On that point IS Risk of infection OF LOSS IN FUTURES TRADING OR WITH ANY TRADING SYSTEM OR PROGRAM. CAREFUL Rating OF YOUR PERSONAL FINANCIAL SITUATION MUST BE DONE PRIOR TO DECIDING TO TRADE IN THE FUTURES MARKETS OR ANY GIVEN TRADING SYSTEM OR METHODOLOGY. From: R Quant