HOW TO SELECT WINNING INCOME GENERATORS

1. Always trade IG’s in trending charts only!!!
2. Trend is defined as a nice, steady angle, ideally 45 degrees.
3. Trend is very good if cycles are bouncing off 20EMA.

IGgood01
4. For an uptrend, on the daily, the 20EMA should be above the 50EMA, and even better if the 50EMA is above the 200EMA. Price should of course be above the 50EMA. To recap, price, then 20, then 50, then 200.
4b. Ideally, the moving averages are pointing upwards, with decent separation amongst them.

IGgood03
5. For a downtrend, on the daily, the 20EMA should be below the 50EMA, and even better if the 50EMA is below the 200EMA. Price should of course be below the 50EMA. To recap, price, then 20, then 50, then 200.
5b. Ideally, the moving averages are pointing downwards, with decent separation amongst them.

IGgood02
6. The price action should ideally be calm, trending and cycling in a nice, decent, almost predictable manner. Avoid charts with noise, like the plague.

IGbad01
7. On the weekly timeframe, the trend should be in the same direction, and in PHASE 1!!!
(Remember, when the weekly goes into phase 2/ retracement, the daily will TEMPORARILY change trend – during the period, do not trade the IG signals.)
8. Bonus is if the weekly moving averages are the same as on the daily i.e.
8.1. For an uptrend, on the daily, the 20EMA should be above the 50EMA, and even better if the 50EMA is above the 200EMA. Price should of course be above the 50EMA. To recap, price, then 20, then 50, then 200.
8.1b. Ideally, the moving averages are pointing upwards, with decent separation amongst them.
8.2. For a downtrend, on the daily, the 20EMA should be below the 50EMA, and even better if the 50EMA is below the 200EMA. Price should of course be below the 50EMA. To recap, price, then 20, then 50, then 200.
8.2b. Ideally, the moving averages are pointing downwards, with decent separation amongst them.
9. In an uptrend, low-test bars, especially on the 20EMA or 50EMA, are the most likely to be the trigger bars. Please note: uptrend IG’s give signals on red seller bars, and downtrend IG’s give signals on green buyer bars.  However, if during phase 2, you get a green low test off the 20EMA/50EMA, or a red high-test of the 20EMA/50EMA, this won’t give you an IG signal, but it is a good entry anyway.

WATCHLIST THIS WEEK:
1. CAD LONG, EURCAD LONG, GBPCAD LONG, NZDCAD LONG
2. TONIGHT AUDNZD SHORT?

WAIT FOR WEEKLY RETRACEMENT ON:
1. ALL JPY PAIRS
2. EURAUD, GBPAUD

2 thoughts on “HOW TO SELECT WINNING INCOME GENERATORS

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