heiken ashi trading strategy amibroker

Heikin-Ashi is a trend visualization proficiency supported Japanese candlestick charting. In-fact, Heikin-Ashi is as wel a type of candlestick, whose OHLC value differs from the handed-down candlesticks. In Japanese, Heikin means "average" and "ashi" means "stride" . Assumed together, Heikin-Ashi represents the middling-pace of prices. Heikin-Ashi Candlesticks utilise the open-close data from the preceding period and the unprotected-high-low-lying-close information from the live period to create a jazz band candlestick. In this post we would reveal a Heikin Ashi Trading System coded in Amibroker AFL. This system is optimized for NSE:Banknifty but should work well for strange instruments overly.

Analyzing price patterns in Heikin-Ashi charts is far more simpler and visually appealing As compared to traditional candle holder charts. See the below image:

Image Source- dan Valcu:CFTe

Calculative Heikin-Ashi prices

As discussed above, OHLC rate for Heikin-Ashi charts differs from the traditional candle holder charts. It is calculated using the below chemical formula:

HAClose = (Open+Upper+Low+Close)/4
o Average price of the current bar
HAOpen = [HAOpen(Previous Bar) + HAClose(Previous Legal community)]/2
o Midpoint of the early BAR
HAHigh = Easy lay(Altissimo, HAOpen, HAClose)
o Highest prise in the countersink
HALow = Min(Low, HAOpen, HAClose)
o Lowest valuate in the set

Heikin-Ashi Trading rules

Below are the 5 important rules (from Investopedia) which should personify followed patc trading with Heikin-Ashi technique:

Green candles with no lower "shadows" indicate a strong uptrend: Lashkar-e-Taiba your profits ride
Green candles signify an uptrend: you might want to add to your long position, and snuff it short positions.
One candle with a small body enclosed by upper and lower berth shadows indicates a trend change: risk-loving traders might buy or sell here, while others wish wait for confirmation before going short Beaver State long.
Chromatic candles indicate a downtrend: you might want to add to your short position, and exit long positions.
Red candles with no higher shadows identify a potent downtrend: stay shortened until there's a deepen in vogue.

In the next section, dannbsp;we'll go by through an AFL and backtest written report for this Heikin Ashi Trading System. Please call Trading Tuitions Academy to larn AFL coding and create your own Trading systems.

Heikin Ashi Trading System – AFL Overview

Parameter	Value
Preferred Clock-frame	Daily
Indicators Exploited	EMA
Buy up Condition	Constitution of Heikin-Ashi special K candle with Open=Downcast, and Closedangt;40 period EMA of Closing
Short Condition	Formation of Heikin-Ashi red candle with Admissive=High, and Closedanlt;40 period of time EMA of Close
Sell Stipulation	Unvaried as Short Stop Loss Hit Closedanlt;40 period EMA of Closelipped
Cover Condition	Same as Buy Stop Exit Hit Closedangt;40 period EMA of Close
Stop Loss	1%
Targets	No fixed objective
Position Size	120 Quantities
First Equity	200000
Securities firm	50 per order
Margin	10%

Heikin Ashi Trading Arrangement – American Federation of Labor Code

Snap here to download the American Federation of Labor code for this arrangement.

American Federation of Labor Screenshot

Heikin Ashi Trading System – Backtest Report

Paramter	Value
Paramter	Secure Post Size
Initial Capital	200000
Terminal Capital	1726506.44
Scrip Name	NSE Banknifty
Backtest Period	01-Mar-2000 to 09-Mar-2016
Timeframe	Daily
Profits %	763.25%
Annual Return %	13.94%
Number of Trades	276
Fetching Trade %	25.36%
Average holding Period	11.88 periods
Max consecutive losings	18
Liquid ecstasy system % drawdown	-75.62%
Georgia home boy Trade % drawdown	-32.42%

Clearly, drawdown is on a higher side. It could be overcome with proper Risk Direction strategies. Download the detailed backtest write up here.

Equity Curvature

Additive Amibroker settings for backtesting

Goto Symbol–dangt;Info, and specify the lot size and gross profit margin requirement. The below screenshot shows lot size of 40 and margin demand of 10% for NSE Banknifty:

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