Have you every considered using other types of charts to help guide you in making trading decisions? I suggest you take a look at the variety of chart options that you may have in your existing charting package. I would like to give you one example of a trading strategy that I often use to help me in making the decision to trigger and stay in a trade using Heikin-Ashi charts.

First of all, a little back ground on Heikin-Ashi charts. The Heikin-Ashi chart that came after the candlestick chart is one of the several different achievements of early Japanese traders. The visualisation of this type of chart is useful in spotting trends easily. Heikin-Ashi candles are different and each candle is calculated and plotted using some information from the previous candle:

• Close price: the close price in a Heikin-Ashi candle is the average of open, close, high and low price.
• Open price: the open price in a Heikin-Ashi candle is the average of the open and close of the previous candle.
• High price: the high price in a Heikin-Ashi candle is chosen from one of the high, open and close price of which has the highest value.
• Low price: the low price in a Heikin-Ashi candle is chosen from one of the high, open and close price of which has the lowest value.

When ploting this type of chart it provides a little bit of lag but not near the lag as in a moving average as shown in the thumbnail. Thus it gets you in the trade quickly and keeps you in just until the trend reverses. Lets look at the simple  trade set up and follow through:

1. The trigger is having two same colored bars in the same direction.
2. The exit is when you have one colored bar in the opposite direction.

If you noticed in the normal 10 minute chart following the same period you would have had several false stop signals. Using different time frames you may use this to help guide you on the trade trigger or help you stay in a trade longer to let your profits runs. Experiement and let us know how you have done …