“We are what we repeatedly do. Excellence, then, is not an act

but a habit.”Aristotle

Information Sites/Groups on Forex• http://www.compassfx.com/

Introducing Broker (IB) with Synergy, a FREE trading program . We use them and they are VERY helpful plus they trade forex. Synergy download link is on the home page.

They also have Synergy Advanced for a monthly fee.

Dean Malone provides daily free commentary on the forex market plus there is a live trading room where one can trade along with Dean if desired. He is very committed to educating clients to be successful traders so he provides a great deal of free education.

• MetaTrader*Experts*and*Indicators@yahoogroups.com* equals underscores in the name and link to the group. Lots of emails, code writers, free indicators, discussions of strategies and automatic trading systems called Expert Advisors of dubious success.

• http://forexlibraryonline.blogspot.com/Lots of good information about indicators.

• http://forex-strategies-revealed.com/ More information.

• http://www.forexpeacearmy.com/Lots of information from program users on good and bad programs or managed account services.

• http://forex.timezoneconverter.com/index.cgiJust what it says.

• http://www.forexmt4.com/mt_yahoo/Free Metatrader4 (MT4) scripts for indicators and other things like session blocks, etc., which locate a block of time on your chart to correspond to the Asian, European and American sessions including breakout boxes of each session. They even have things that combine an indicator of another indicator.

• http://www.forexbrokerguide.com/forex-broker-search

Can be helpful if you’re not familiar with a particular broker.

How to Trade Synergy Basic

• Synergy Basic has three components. The price is displayed in the form of Heiken Ashi candlesticks.

• The HA candles have a Price Action Channel superimposed on them, calculated as a 5 day smoothed moving average of the daily high and 5 day smoothed moving average of the low.

• Signals are generated when the body of the candle moves up into the channel or down into the PA Channel. This type of candle has little to no wicks or tails during a trend.

• If it is a buy, the tails are usually missing or short. • If it is a sell, the wicks are usually missing or short.

Heiken Ashi Candles Formulation in the Synergy Program

• Heiken means “average” and Ashi means “bar” so they are averaged bars rather than the more traditional candles based on actual prices. Hence they have a different appearance and significance in the Synergy Method. They are not true Heiken Ashi candles in terms of their calculation in Synergy.

• HA_close = (Open+High+Low+Close)/4

• haOpen = {haOpen(previous bar)+haClose(previous bar)/2}

• haHigh = Maximum (High, haOpen)

• haLow = Minimum (Low, haOpen)

• The HA_Close is the most important for the Synergy Method as developed by Dean Malone.

Price Action Channel

• The basic trend is identifiable when the PAC is added to the candles.

• In a Buy trend, the candles tend to ride inside the lower yellow line or on the upper level of the PAC with no or short tails.

• In a Sell trend, the candles tend to ride inside the upper yellow line or on the lower yellow line level of the PAC with no or short wicks.

• Be careful of more than 7-8 candles in a trend. They can tire easily.

Moving Averages• http://ta.mql4.com/ The web site for info and code for indicators and

hiring coders to write programs.

• In MT4, there are 4 different methods of computing Moving Averages:

– Simple SMA = SUM(CLOSE, N)/N where N=# of periods

– Exponential Moving Average (EMA) EMA = (CLOSE(i)*P)+(EMA(i-1)*(1-P))

Where: CLOSE(i) — the price of the current period closure;EMA(i-1) — Exponentially Moving Average of the previous period closure;P — the percentage of using the price value.

– Smoothed Moving Average (SMMA) The first value of this smoothed moving average is calculated as the simple moving average (SMA): SUM1 = SUM(CLOSE, N) SMMA1 = SUM1/N

The second and succeeding moving averages are calculated according to

this formula: PREVSUM = SMMA(i-1) *N and SMMA(i) = (PREVSUM-

SMMA(i-1)+CLOSE(i))/N

Where:

SUM1 — is the total sum of closing prices for N periods;

PREVSUM — is the smoothed sum of the previous bar;

SMMA1 — is the smoothed moving average of the first bar;

SMMA(i) — is the smoothed moving average of the current bar (except for the first one);

CLOSE(i) — is the current closing price;

N — is the smoothing period.

– Linear Weighted Moving Average (LWMA)= LWMA = SUM(Close(i)*i, N)/SUM(i,

N)

Where:

SUM(i, N) — is the total sum of weight coefficients.

http://ta.mql4.com/indicators/trends/moving_average for more information

In MT4, the various targets for MAs are:

• The third is the Trader’s Dynamic Index or TDI which is composed of RSI of price, the green line. It is almost an exact duplicate of the Heiken Ashi candles.

• The Trade Signal line is the red line. Trade LONG when the Green line is above the Red line. Trade SHORT when the Green line is below the Red line. Exit trade when Green and Red cross, indicates a change in trend from previous direction. These are also called Counter Trend signals rather than confirmed signals discussed in the next slide.

Traders Dynamic Index

• The Market Base Line (MBI) is the overall trend, the yellowline. It’s movement is not as dramatic as the Trade Signal Lines. It shows Confirmed signals.

• Trade LONG when the Green line is above the Yellow. Trade SHORT when the Green line is below the Yellow.

Traders Dynamic Index

TDI computations info

• RSI of Price (Green Line) is 13.• The Blue Volatility Bands are similar to a

Standard Deviation of 34.• Market Base Line (Yellow Line) is a

Moving Average of the RSI/Deviation: 2 and 7

LET THE TRADING BEGIN!!

Let’s Look at Some Contemporary Charts from the Forex Market

Let’s look at the program and the USDJPY currency pairs from this past week of trading starting with

USDJPY 1 hour vs 15 minute chart.

Want to Give it a Go Free of Cost?

• Go to Compass FX web site www.compassfx.com and on the right hand frame of the home page, there’s a button to use to open a demo account.

• Open a demo account. • Load the Synergy Basic off the same home

page and see if this hits your Happy Button. If you cannot find it, contact Judith.

Contact Information

• Compass FX /Dean Malone

www.synergyprotrader.com

www.compassfx.com

dean@compassfx.com

2083 N. Collins Blvd., Ste. 200

Richardson, TX 75080

972-680-8080, 1.800.577.3600

• Judith Stephens/Forrest Miller

ohneclue@yahoo.com 214-893-4471(J) 214-405-2681(F)