Trading Strategies from Active Trader Magazine

Trend with Pattern Entry System

This system requires MetaStock 8.0 or later to set the correct trade size and entry price. There is no difference between the stock and future version of these formulas. To create this system:

• Select the Enhanced System tester from the Tools menu
• Click New
• Enter the name of the system
• Select the Buy Order tab and enter the following formula:
  
  bc:=sum(c>mov(c,100,s),3)=3 and sum(c<ref(c,-1),2)=2;
  trade:= If(PREV <= 0, If(bc,C,0),
  If(L<=(PREV-(4*ATR(10))),-.001 ,
  if(roc(c,1,$)>0,max(c,PREV),PREV)));
  cross(trade>0,0.5)
  
  
• Set the enter size dropdown to "% of available equity"
• Click the italics f to the right of the space for the entry size
• In the window that appears, enter the following formula:
  
  equity:=Simulation.AccountCash+Simulation.AccountBorrowed+
  Simulation.PortfolioValue+Simulation.AccountReserved;
  
  (equity*.02)/(c-(4*ATR(10)))
  
  
• Select the Sell Order tab and enter this formula:
  
  bc:=sum(c>mov(c,100,s),3)=3 and sum(c<ref(c,-1),2)=2;
  trade:= If(PREV <= 0, If(bc,C,0),
  If(L<=(PREV-(4*ATR(10))),-.001 ,
  if(roc(c,1,$)>0,max(c,PREV),PREV)));
  cross(0,trade)
  
  
• Set the order type to "Stop Limit"
• Click the italics f to the right of the space for the entry size
• In the window that appears, enter the following formula:
  
  bc:=sum(c>mov(c,100,s),3)=3 and sum(c<ref(c,-1),2)=2;
  trade:= If(PREV <= 0, If(bc,C,0),
  If(L<=(PREV-(4*ATR(10))),-.001 ,
  if(roc(c,1,$)>0,max(c,PREV),PREV)));
  ref(trade,-1)-(4*ATR(10))