After 9 months of trying to actively trade instead of investing, and being mildly down on my capital, I figure that my methods so far are pretty much throw a dart at the dartboard and hope for the best. The only bright side I have is that I'm down less than the market overall - but not by much.
There are things I have learned, mostly to do with trading discipline, but I think my methodology needs a serious overhaul.
I first started using a 10 Day EMA as my "fast moving" indicator, and a 26/12/9 MACD as my slow moving indicator, and when both agreed, I went in. The theory was that having a fast and slow moving indicator means I could get most of the movement, but miss the volatile whipsaws.
Obviously, since they're both moving average based, I decided this was bad, and started playing around with RSI - 5 day and 14 day Wilder. However, my feel is that RSI is still a moving averages based indicator, just with a different formula.
So, my question is, if you were to use two indicators to signal and confirm, which two would you use?
My overall trading strategy is divide my capital into five, and spread them out across ASX CFDs, no two being in the same sector. At any time, one or more of those five parcels can be in cash rather than in a CFD, and positions can be long or short. Obviously a high risk investment strategy, but it's not my retirement money I'm playing with here. Just a spare 20k I have.
Thanks heaps for advice and input.