Hey now. I'm back with another exclusive trading
system that is unlike anything I have ever tested before, either for myself
or the channel. This complete trading system was inspired by a video from the Secret Mindset
channel and shows a lot of potential that can be further exploited with my extremely popular
optimization tips. And if you are not subscribed then this may happen to your trading account.
I call this system Anchors Aweigh and like most
trading systems it can be adapted to Forex, crypto,
options, stocks, indices, or any instrument that has significant volume and market participants.
This trading strategy utilizes just one free TradingView indicator and one TradingView
display feature. As always the link and settings to the indicator is listed in the description
below. The only indicator that this system uses is the Anchored Volume Weighted Average Price
or Anchored VWAP. This indicator is accessed in a different way than any
other indicator on TradingView. To place the anchored VWAP on the chart
you're going to click on this left toolbar menu item and select anchored VWAP. Then you
are going to click on the specific candle where you want the origin point of the indicator to be.
The VWAP consists of three bands the middle blue band which is the actual VWAP, and the
upper and lower bands that are set to one standard deviation of the VWAP line. The Anchored VWAP was
created in the mid-90s by physicist Paul Levine as part of the MIDAS Forecasting System. Unlike
the standard VWAP which has its origin point as the first candle of the trading day. The anchored
VWAP allows you to specify exactly which candle is the indicator's starting point. I am going to keep
inputs and style at default. In Anchors Aweigh the Anchored VWAP will provide our entry triggers.
The second item to add to your chart are events.
You can right-click anywhere on the chart and then select
dividends, splits, and earnings. These specific news items will act as our precondition for entry.
Let's go over enter criteria and review some examples. As always system rules and details
are listed in the description below. This chart is Apple 15-minute Japanese candlesticks. The rules
to enter a long on Anchors Aweigh are first, we are looking for a news event. Either a dividends
report, earnings report, or split. Here we can see a "D" which signifies a dividends report.
Second, we wait for the candle to close where the news event took place and put the anchored VWAP
on that candle. Next, we are going to wait for at least five candles to close. Finally,
the trade is entered when price closes outside the standard deviation anchored VWAP band. Our
rules are met when this candle closes, that is our trigger candle. We place the stop at
the previous swing low and target two times risk. If you enjoy this content make sure to click the
like button. And the previous trend continues to our profit target. I have one more long example.
There is a candle that closes when an earnings report is released. The anchored VWAP indicator
is placed on that candle. Then wait for at least five candles to close.
Enter on the first candle that closes above the upper anchored VWAP band. Everything converges
on this candle and it serves as our trigger. Place the stop at the previous swing low and
target one to two. And this example hits the profit target. Now we flip to shorts.
This is what I will test for shorts. First, we are looking for an earnings or dividend report.
Here we can see an earnings report. Second, after the candle closes where the news event
took place the Anchored VWAP is placed on that candle. Third, count five closed candles. The
final short entry rule requires price to close below the lowered Anchored VWAP band.
All of that happens on this candle here, that is our trigger candle. The stop is placed at
the previous swing high and target is one to two. And this example hits the profit target.
I'm going to show you one more quick short example.
We can see a dividends report and a candle close. The Anchored VWAP is placed on this candle.
We wait for at least five candles to close and enter on the first candle that closes outside the
lower anchored VWAP standard deviation band. This is our trigger candle. The stop is placed at the
previous swing high and the target is one to two. And after some time this example hits the target.
I am going to give you some fantastic ideas on how we can improve this system
along with a Trader's Landing Score and now it's time to do, what i do.
If you enjoy this content hit the like button. Remember this is a limited amount of tests on
four instruments if you are thinking of using this system please do extensive back and forward
testing and be sure to let our community know what you discover. Due to the nature
of the preconditions of this particular system I tested this on four equities, Apple, ConEd, HSBC,
and Tata. The combined results were derived using 15-minute candles. It took a little more than four
years to find the 77 setups, and I am going to share with you how to change this system
to get many more setups. Anchors Aweigh had a 58% win rate and a very nice profit factor of 2.78,
the total gain on account risking 2 percent per trade would have been 114% gross. According to
profit factor the best results were on Tata, but this could be due to many different factors.
So the equity curves here are less useful than usual due to this data set. However,
what we can quickly conclude is this system has potential.
What score would you give this strategy? Let me know in the comments below. I give this system
a Trader's Landing score of 7. Because it uses key market events for entry more often than not,
is on the right side of the market, but on its own entries are few and far between. But I'm
going to show you some different methods to get into many more setups with much better results.
Remember the enemy of great is good I have five ideas on how we can improve this system. First
and foremost there are many more ways to get into this market using the system. What it comes down
to as Marius says is where do you want the Anchored VWAP to start from? You can see on
this chart that if you change the system around to only take longs when the 50 is above the 200 EMAs,
and the Anchor is set to every candle that bounces off the 50,
you would have taken about 10 successful setups during this huge bullish trend.
Conversely, if you want to trade more news you can simply use the same system whenever news comes out
on a particular asset and you can check sources such as Twitter, Bloomberg, CNBC, or standard
economic calendar. The principles remain the same. Furthermore, another way to determine
your Anchored VWAP starting point is look at volume itself. On this chart you can see these
huge spikes in volume which typically serve as good places to put your Anchored VWAP indicator.
Second, no system exists in a vacuum look at this losing long setup that could have been avoided
by clear and obvious resistance into the 200 EMA and price level resistance.
Third, building on the previous point you can up your game by adding in market structure.
Here is a losing short setup from the test, an experienced technical analyst
would not take the setup until the price broke either of these two lines.
Fourth, you can simply wait until after the news and look for an additional trend continuation that
is confirmed by hidden divergence. Here we can see clear hidden bullish divergence, a higher low
on price, and a lower low on the RSI. This is followed by the expected trend continuation.
Another way to enter is actually placing the Anchored VWAP on the fifth candle after the
news event. You can see here it would have saved you from this false long signal and gotten you
into this huge bearish move. Check out this playlist for more profitable systems.
And have a great day, because you deserve it.
you