Back cover Building on the foundation of the first book that was sold in 46 countries, Heikin-Ashi Trends and Timing explores several innovative applications of the heikin-ashi trend technique in trading and focuses on how to use it to time trades successfully. The book is a must for any trader looking to advance the knowledge and practice of heikin-ashi, and who wants to add more precision and foresight to trading. This second book has over 75 charts and tables displaying new heikin-ashi concepts and trading scenarios. During the one hour presentation, traders learn how to use heikin-ashi faster, in a more efficient way. A description of heikin-ashi pitfalls and benefits, several techniques to remove noise from trading, plus a heikin-ashi cookbook add to the practical value of this first book on this technique. Its chapters focus on trends and timing, and provide techniques and examples built around heikin-ashi in visual and quantifiable formats: Heikin-Ashi: How to Trade without Japanese Candlestick Patterns is the first practical and visual book to reveal and explain this revolutionary, simple, and pragmatic technique to anyone from novice to seasoned trader and investor.
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Candlesticks became a popular trading instrument, and traders began working with them in order to ease the reading of the charts.
But the interpretation of candlesticks differ from one another. One of these methods, which changes the traditional candlestick chart, and facilitates its perception, is called the Heikin Ashi technology.
It turned out to be a Heikin-Ashi diagram, or to be more precise, some altered candlesticks. This method of analysis was developed by a Japanese trader who became very successful and uses this method to this day. To the surprise of the author, he found no other related information in books or the Internet, so he decided to make it available to all traders by publishing it in a journal.
The Heikin-Ashi method heikin in Japanese means the "middle" or the "balance", and ashi means "foot" or "bar" , and is a visual tool for assessing trends, their direction and strength. This is not a "Holy Grail" of trading, but it is definitely a good and easy-to-use instrument for visualizing trends. The prefix "ha" indicates the corresponding modified values of heikin-ashi. To facilitate the perception of market information, the Heikin-Ashi technology modifies the traditional candlestick chart, by creating so-called synthetic candlesticks, which remove irregularity from the normal chart, offering a better picture of trends and consolidations.
Just by looking at the candlestick chart, created using this method, you get a good overview of the market and its style: Figure 1. On the left is regular candlestick chart a , on the right b Heikin-Ashi chart Fig.
The distinctive feature of these graphs is that in an upwards trend the majority of white candles have no shadow. In a downward trend there is no top shadow for the majority of black candles. The candlesticks on the Heiken-Ashi chart show a greater extent of trend indication than traditional candlesticks. When the trend weakens, the bodies of candlesticks are reduced, and the shadows grow.
It is most convenient to determine the end of a corrective movement, based on these charts. Before installing the indicator onto the chart, I recommend making the graph linear. Also, in the properties of the graph, in the "General" tab, uncheck the item "from the top graph". I would like to once again focus your attention on the fact that the Heiken-Ashi method is not a "Holy Grail".
To prove this, I will try to create a simple trading system TS using only this technique. To do this, we need to create a simple Expert Advisor, using the MQL5 programming language and standard library classes, and then test it on historical data, using the strategy tester of the MetaTrader 5 terminal. A strong tendency 3,4 we acts the same way - by pulling up the stop. Consolidation 5 and a change of trend 6 , closes the position if it is not closed by the stop , however we need to then decide whether or not to open an opposite position.
To make the decision, we need to somehow determine whether a consolidation or a reversal is taking place. We will need a filter, built on indicators, candlestick analysis, or graphical analysis. The objectives of our article does not include the establishment of a profitable strategy, but who knows what we will accomplish as a result. Therefore, let us consider that the appearance of a candle of the opposite color, we will close the position and open a new one with the opposite direction.
With a strong trend, we take the same steps as we did with the trend, ie move the stop. Overall, everything is quite simple, and hopefully clear to the reader. Now we will implement this on the language of MQL5. To set the input parameters in MQL5 we use Input variables. Init events are generated immediately after loading the Expert Advisor. In the code of this function we will connect the indicator to the Expert Advisor. You may wonder why there is so much complexity, if we have the formulas for calculating the indicator, and we can calculate the values in the code of the Expert Advisor.
Therefore, instead of independent calculations, we will exploit the capabilities of MQL5 for connecting our custom indicator, specifically, the function iCustom.
The function OnTick is the handler of the NewTick event , which is generated with the appearance of a new tick. And if both conditions are met, we see the fulfillment of our function CheckForOpenClose where the main work takes place. There are many ways to do this, but the simplest one is to check the volume of ticks.
Thus, if the tick volume is equal to one, this indicates the opening of a new bar, and you should check the terms of TS and put out orders. Using the function CopyRates obtain into it the values of the last bar. Then check the tick volume and if it is greater than one, terminate the function, if not, then continue the calculations.
The "oldest" historically bar is stored in the first element of the array zero. Figure 2. The order of the candlesticks and the values of the indexes of the array And so we have obtained the OHLC Heiken-Ashi values, and it remains to verify the conditions for the opening or maintenance of a positions. Consider in detail the processing of the sale signal.
As I pointed out before, we got the values of three Heiken-Ashi candlesticks. Then we need to check for open positions on the instrument. To do this we will use the CPositionInfo class of trading classes of the default library. This class allows us to obtain information about open positions. If at the current moment we have an open position to buy, then we need to close it. To do this we use the methods of class CTrade of the standard class library , which is designed to perform trading operations.
Using the method PositionClose const string symbol, ulong deviation we will close the purchase, where the symbol is the name of the instrument, and the second parameter, deviation, is the permissible deviation of the closing price. Then we check the combination of candlesticks according to our TS. Method PositionModify symbol, sl, tp Used to change the value of the stop and profit, where symbol - the name of the instrument, sl - Stop, tp - profit.
I would like to draw your attention to the fact that before using this method, you should check for the presence of an open position. The method ResultRetcodeDescription is used for obtaining the description of the code error in the form of a line. This completes the processing of the signal to sell. To buy we use the same principle. Copy it to the catalog.. Testing the trading system on historical data To check the viability of our trading system, we will use the MetaTrader 5 strategy tester, which is a part of the trading platform.
Once it is launched, we locate the "Settings" tab Figure 3. Figure 3. Strategy Tester settings Configuring the Expert Advisor - choose from a list of our Expert Advisors, indicate the testing interval as the beginning of through the end of , the amount of initial deposit is 10, USD, disable the optimization since we have only one input parameter, and we just want to check the viability of the TS.
Testing will be done using two currency pairs. For testing, I decided to take the following time intervals: H3, H6 and H You will ask why?
The answer is because I wanted to test the TS on time intervals, which were not present in the MetaTrader4 terminal. So here we go. Upon completion of testing, we see two new tabs in the tester window: "Results" Fig. Figure 4. The graph Fig. Figure 5.
In addition, we have the ability to view transactions, orders, and written file reports. To do this, we simply place the cursor over the tab, click the right mouse button, and select the appropriate menu item: Figure 6.
Context menu of the Strategy Tester Results tab Here is the results of testing on over a six-hour period H6 : Figure 7. Figure 8. But we can notice that the variation of the working period significantly affects the result. Figure 9. Over a twelve-hour period, we received a considerable profit of ,23 USD, although it was received over nine years.
Those who are interested can test other currency pairs. My assumption is that the more volatile the pair is, the better result should be obtained, and the longer time period should be used. Conclusion In conclusion, I emphasize, that this trading system is not the "Holy Grail" and can not be used on its own. However, if with additional signals candlestick analysis, wave analysis, indicators, trends we separate the reversal signals from the consolidation signals, then on some volatile trading instruments, it can be quite viable, though unlikely to bring a "crazy" profit.
Candlesticks became a popular trading instrument, and traders began working with them in order to ease the reading of the charts. But the interpretation of candlesticks differ from one another. One of these methods, which changes the traditional candlestick chart, and facilitates its perception, is called the Heikin Ashi technology. It turned out to be a Heikin-Ashi diagram, or to be more precise, some altered candlesticks. This method of analysis was developed by a Japanese trader who became very successful and uses this method to this day. To the surprise of the author, he found no other related information in books or the Internet, so he decided to make it available to all traders by publishing it in a journal.
Using the Heikin Ashi Indicator for Determining Market Trends
Heikin-Ashi breaks new ground in trading the trends and demonstrates through examples how the heikin-ashi technique, both visual and quantifiable, is used to identify and antic BACK COVER: Tinashe Makurumure marked it as to-read Nov 23, So you can do the chart analysis work here, and the trading in your platform. We do not send anything via e-mail, sorry. Heikin-Ashi is the first practical and visual guide to reveal and explain this revolutionary, simple, and pragmatic technique to anyone from the novice to the seasoned trader and investor. However their charting features are weak. I wish I had this knowledge in the past! This was one reason I started to use Tradingview. Josef marked it as to-read Nov 09, December 12th, at 6: Subscribe to get daily updates directly to your email inbox.
haDelta (developed by Dan Valcu)
An Example of a Trading System Based on a Heiken-Ashi Indicator