Traders Dynamic Index
Once you see the tool in action you will quickly start to see the benefits it provides. Whether you trade by scalping, short or medium term theTraders Dynamic Index can be interpreted in accordance with your own strategy.
TDI Example
The graph to the left is showing the daily bars of the USD against the JPY in 2009. At the bottom of the graph in its own underlay is theTraders Dynamic Index indicator showing 4 different lines twisting into one and another
What The Colours Represent
- Dark Blue Lines showing the strength of the current trend
- Yellow Line showing the direction of trend
- Red Line displaying the slower Moving Average
- Green Line the slightly faster Moving Average
Traders Dynamic Index Strategies
It is possible to use the TDI indicator on its own, although most traders use a variety of different indicators to back each other up. The safest and probably the most profitable way to take advantage of the TDI is to use the signals produced to re-enforce the buy/sell commands of other indicators. For a basic understanding of the signals produced see the points below:
Scalping w/ TDI
If you are a fast paced very short term trader who makes lots of small risky trades then you can simply concentrate on the 2 MA’s. When green climbs higher than the red MA go for a LONG position, then whent he green drops lower than the red look to SHORT. Using the Traders Dynamic Index Indicator in this way can be risky though but you will find that most indicators give out false signals even when they appear really strong.
Short Term w/ TDI
If you want a level of protection to lower the risk but reduce the amount of signals then try incorporating the yellow line into your strategy. Only go LONG if both MA’s are above the yellow line and only SHORT when they are both below. This ensures that you are at least following the current local trend to the current time-frame you are looking at.
Medium Term w/ TDI
For an additional indication that its safe to make a trade look at the numbers gauged into the right hand side of the underlay. They range from 0 to 100 but show up the currently relevant spread in the window. Only trade LONG when all lines except for the blue bands are above 50 and only go SHORT when all except blue are below 50.
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