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Add the average true range (ATR) indicator with a value of 14 to your chart in question. Look at the reading of the ATR at the candle in question. Take that value & double it. That is 2 times the 14 period ATR - which is essentially asking you to set a stop loss of double the volatility for the last 14 periods.
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Add the average true range (ATR) indicator with a value of 14 to your chart in question. Look at the reading of the ATR at the candle in question. Take that value & double it. That is 2 times the 14 period ATR - which is essentially asking you to set a stop loss of double the volatility for the last 14 periods.

 

Hi.. I am still no clear about the explanation. If the closed price is 1.34936 and the ATR is 0.0361, what is my stop lost? Thanks in advance..:)

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Apple - For some reason the forum isn't displaying my embedded images. Copy the following link into your browser, it will take you to a chart example which might(?) make more sense.. :)

 

http://www.screencast.com/t/SANdTbl4h

 

 

This system is designed to work on Weekly charts and seems to do so with some success. Needless to say the stop loss sizes are enormous in pip terms so I'd say Oanda and it's fractional position sizing is the only broker that allows non-millionaires to trade such stop sizes while strictly making the stop size a managable equity percentage. Though I personally could never trade off weeklys - that's like waiting for the next ice age to happen.

Edited by JimJamBonks
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