I have tested adding another EMA of 30 period (EMA30) to filter the Noise
The rest of the rules remains same as it is mentioned in page 1 of this post. A little modification and just summarised for the benefit of all.
Setup:
EMA : 3, 10 & 30
ADX : 14
Entry:
for Long/Buy: EMA3 crossover EMA10 & EMA30
After crossover please see that the sequence is like EMA30 then EMA 10 and last EMA3
ADX: +DI > -DI
for Short/Sell: Vice versa of Buy setup
No Trade if any of the above condition is not met.
I have attached futures chart of ABB.
http://i.imgur.com/NTou06K.png
1). The 3EMA crossover on 10EMA happened on 19.10.12 & +DI > -DI
2). 22.10.12 the ADX crossover happened and -DI > +DI
3). But 3EMA crossover on 30EMA didnt happened
4). On 23.10.12 3EMA crossover on 30EMA happened.
5). The main condition of sequence didnt happened on 23.10.12 i.e 30, 10, 3 the values from Higher to Lower.
6). On 25.10.12 the same happened i.e EMA30 was above all the EMAS, EMA10 below EMA30 and above EMA3, and EMA3 was below the other two EMA's.
7). The low of 25.10.12 is 746.35 and we enter on low of 746.35
SL: we keep EMA30 as SL (which means the signal day)
Exit: Price not touching 3EMA or some fixed % according to the risk taking appetite
In the next few threads I will explain you how this filter has avoided Whipsaw with charts!
Karthik
