Templates

Templates are simple combinations of indicators.

They are the basic building blocks of successful trading systems.

In essence, templates can be designed to give us our buy/sell signals.

For example, there are people who use a combined 20-day moving average with the 50-day moving average to determine their buying and selling decisions.

• When the 20MA crosses above 50MA, this is a signal to buy 

• When the 20MA crosses below 50MA, this is a signal to sell 

Using this simple system, from the Chart above, in 3 April 2008 they bought AAPL for $150 (since 20MA cross above 50MA). 1 month later, they could have sold AAPL for $190, making themselves a nice profit.

Next: Swing Trading Systems ...