Learn how to use the DMI and Alligator indicators to spot short-term reversals and visualize trends for successful trading in this strategy. Backtesting results show a winning percentage of 55%. Exercising caution and good judgment is crucial in any trading strategy.
Dive into Success with the DMI-Powered Alligator Trading Strategy
Introduction
– Feeling like a Fish out of Water in Trading?
– Fear Not, the DMI-Powered Alligator is Here to Help
Indicator 1: DMI
– Understanding the Directional Movement Index
– History of the DMI
– How the DMI Determines Trending Markets
– Calculation of Plus DI, Minus DI, and ADX
– Importance of Using a DMI with 14 Length and Smoothing
Indicator 2: Alligator
– Overview of the Alligator Indicator
– Development of the Alligator by J Wells Wilder Jr
– Composition of the Jaw, Teeth, and Lips
– Interpretation of the Alligator’s Positioning
– Importance of Using an Alligator with Lengths of 13, 8, 5, and 3
Back Testing Results
– Analyzing the Results of Back Testing
– Importance of Winning Percentage, Average Trade, Total P/L, Average Win, Average Loss, Risk-Reward Ratio, and Return on Capital
– Reminder that No Trading Strategy is Foolproof
Conclusion
– Recap of the DMI-Powered Alligator Trading Strategy
– Reminder to Always do Your Own Research and Trade Safely