Jan 15, 2011
A pretty interesting indicator I found is called the Schaff Trend Cycle indicator for MT4. My biggest questions are:
A) Does this indicator work?
B) How does this indicator work?
C) When Does it work best?
D) On what time frame does it work best?
The Schaff Trend Cycle helped to tweak MACD in respect to the speed at which it can alert us to potential trades, specifically the inception of trending moves. Crossing a MACD line (the difference between two exponential moving averages) through a reworked stochastic algorithm assists to calculate Schaff Trend Cycle. The cycles are usually discovered by it. The highs and lows at the frames of these “trend cycles” could be used to identify trends, and emphasize some trading opportunities- long within uptrends and short within downtrends. In sideways markets Schaff Trend Cycle is also used as the overbought/oversold indicator and this indicator usually has limits between 0 and 100. The 25-line and 75-line mean “buy” and “sell” lines and they are expressed horizontally at 25 and 75.
I’ve come to the conclusion that when the purple line does in fact begin to decline, a down trend might be not too far in the offing, so look for sells. When the line is flat on the bottom, look for the purple line to start to incline and usually an uptrend is formed.
This is much more effective on the 1 Hour time frame.
Schaff Trend Cycle on 15 Minute Charts
Schaff Trend Cycle 5 Minute
For more information on Schaff Trend Cycle Indicators and the strategies that might help you please visit the forum: http://forexforums.com/forums/forex-strategies/24302-schaff-trend-cycle-its-strategies.html