Fine Tuning Indicator Settings

[rfk_from_za]

Hi Guys,

I have settled on a collection of indicators that I will use to help me enter trades. However what I would like to know is how does everyone here go about determining the best settings for your indicators.

I understand that back testing is the best way, but some general rules of thumb would really help me a lot.

The indicators that I am interested in are:

Exponential Moving averages (I use three)
Williams %R
MACD
Stochastic

I use the above in conjunction with various chart patterns. So far they have been reasonably accurate in terms of buy and sell signals. I have however suffered from some whipsaws every now and then so would like to minimize these.

Any tips, tricks or general advice would be greatly appreciated.

Regards,

Rob

 

[turtle trader]

Rob

Don't get too caught up with optimizing indicator settings, try just using what you feel comfortable with, and then apply them to different (higher) timeframes. If you're getting the same signals on more than one timeframe then it'll normally be more reliable.

You're also using a lot of indicators there - do you really need them all? I'm sure you're going to get a lot of responses suggesting you ignore indicators & just concentrate on price (and volume). Indicators can be very useful, depending on how you trade, but you don't need them all. Try looking at how the indicators are acting relative to price - is there any divergence etc?

Simon