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FOZZY Trading Method E-book

FOZZY Trading Method E-book

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Published by api-26247058

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Published by: api-26247058 on Oct 18, 2008
Copyright:Attribution Non-commercial

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05/09/2014

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Page 1 of 17
The Daily Fozzy Method
An e-book for trading forex daily charts

Introduction\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026 Page 2
First steps\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026............ Page 2
Making a trade\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026.. Page 4
Placing stops\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026. Page 5
Exiting a trade\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026...... Page 7
No target point\u2026\u2026\u2026\u2026\u2026\u2026..\u2026\u2026\u2026\u2026.. Page 8
Using limits\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026.. Page 9

Getting in and out; Setting limits based on s/r;
Using the 28 EMA; Using Fibonacci levels

Multiple lots\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026. Page 11
Choosing the trades to trade\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026.. Page 12
Going with the trend\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026. Page 12
Bucking the trend\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026 Page 12
Waiting for convergence\u2026\u2026\u2026\u2026.\u2026. Page 13
Back-to-back signals\u2026\u2026\u2026..\u2026\u2026\u2026\u2026. Page 14
Reactions to news releases\u2026\u2026..\u2026. Page 15
Waiting for retraces\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026.. Page 15
Final thoughts\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026.. Page 16
Risk and correlation\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026.. Page 16

Backtesting\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026.. Page 16
Produced by forex-rewards.com
Page 2 of 17
Introduction

This e-book aims to outline a simple method of using daily charts to profit from forex.
Why daily charts? Using the dailies allows the trader to work trading into his daily
routine, being able to assess every opportunity but stopping the charts from taking
over his life. In short, a tradable system for people living in the real world.

Most of the ideas contained within this e-book belong to the generous traders at
Forex Factory\u2019s forum. You can visit that thread here at
www.forexfactory.com/showthread.php?t=7984.
My thanks go to all the traders who have shared their ideas and thoughts.

The following pages merely provide guidelines for taking and exiting trades. This
book comes with no guarantees, no promises. Trades are made at your own risk and
the author of this e-book is not liable for any losses you may incur. Forex is a high
risk enterprise, you may lose all of your money and you should only trade with
money you can afford to lose.

First steps

I use Metatrader4 for my charts. They are free and incredibly user friendly.
Downloads can be found at any MT4 broker, just sign up for a demo account. A non-
expiring account can be found atwww.n ort hf in an c e.c om/en g/open -dem o-ac c ou nt /

So we have our charts. Now we want to set up the method. First, make sure you are
looking at the daily (D1). Open the navigator and expand the \u201cIndicators\u201d sub-root
(see Fig 1). Next drag the Moving Average icon onto the RSI window and set it as an
8-period EMA (Exponential Moving Average) (see Fig 3 for settings details).

Page 3 of 17

Next step is to put an ATR (Average True Range) figure in the window (see Fig 4).
Note: We only want the ATR value, not the graph so color should be set to \u201cnone\u201d.
Finally, add a 28-period EMA to the main chart window so your chart should look like

Fig 5.

To avoid having to set up charts yourself, you can find a template at my home
page\u2019s resource page atwww.f or ex -r ewar ds .c om /r es ou r c es. Download the file and
put it in c:\program files\your metatrader4 directory\templates.

A brief overview of the RSI indicator and related topics can be found at
www.investopedia.com/terms/r/rsi.asp.

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