NNFX Strength System - User Guide

NNFX Strength indicator scans 28 Forex pairs to determine the relative strength of the 8 major currencies within a given period, these are normalised as percentages from 0 to 100. The resulting currency lines are smoothed by a definable moving average and data is extracted from the currency relationships to give momentum-based trend and trade signals. By switching through the 28 currency pairs you can quickly see whether a trade opportunity exists to act on, the recommended StopLoss and TakeProfit levels are also shown. Once trades are placed it is easy to manage their progress with the data shown visually, telling you to either hold or exit.

Currency pairs scanned are all combinations of EUR, USD, GBP, CHF, CAD, AUD, JPY, NZD only.

• Open a new chart with the desired timeframe (ie. EURUSD H4) and load NNFX Strength onto it. The necessary data will download and populate the charts for the indicator to show correctly. Right-click then Refresh if necessary.
• To preload all required history data for the 28 currency pairs, load this expert advisor onto a new chart with a minimum value 0f 200 bars. Alternatively, you can load each chart one by one and right-click then Refresh. There are several ways to do this.
• When all the history data is available the indicator will show correctly. If any symbols are missing, add them in Market Watch. 
• On the right side of the indicator window is the currency analysis data calculated by NNFX Strength. This includes STRENGTH, DIFFERENCE, MOVEMENT, MOMENTUM and TREND.
• On the bottom left side the TRADE signal is given based on this data. If a trade signal exists it will look like this... Sell EURUSD or Buy GBPJPY.
• Hold Buy, Hold Sell or Hold or Exit signals do not count as entries and are used for managing trades only.

1. Use default indicator settings, these are optimised for H4 timeframe.
2. Make sure your GMT offset is correct for your trade server. You will then see the market session in the top left corner of the indicator window. You can double check this with Show_History enabled on a H1 chart, comparing with a data source such as Forex Factory. 
3. Check the trading signal for your current pair at the open of a new candle (ie, 4:00, 8:00, 12:00 etc).
4. If a trade signal is given (ie, Buy EURGBP) open two market orders with recommended Lot size, TP and SL levels. Set the TP on one to 0 to allow profits to run if it trends strongly. Total risk is split between both trades, so for 2% total risk you would use 1% risk on each. You can also use a trade assistant such as this one or this one (easier to use but can slow down charts).
5. Click and drag the next pair in the Market Watch window onto the chart to change it. Alternatively, use a symbol changer indicator such as this one to do this more easily (double-click to refresh NNFX Strength quicker).
6. If a trade signal is given open two market orders like before (ie, 0.2 lots + 0.2 lots = 0.4 lots risk total). 
7. Repeat this for all 28 Forex pairs, being careful not to become overexposed in one particular currency (ie, EUR or GBP). If you do want to take all trades given, lower the lot size risk of all your trades to accomodate with Lots_Risk_Percent.
8. Set an alarm for the next candle (ie, in 4 hours) as a reminder to return to the charts and manage your trades.

1. Open indicator settings and load this  preset. 
2. Note that Use_Previous_Close is false. This will use the close of the current candle for data as you are trading at the end of the candle instead of the beginning.
3. Make sure your GMT offset is correct for your trade server. You will then see the market session in the top left corner of the indicator window.  You can double check this with Show_History enabled on a H1 chart , comparing with a data source such as Forex Factory. 
4. Check the trading signal for your current pair 20 mins before the end of the trading day (New York market close, or 23:40 server time). If the new trading day has already begun set Use_Previous_Close to true.
5. If a trade signal is given (ie, Buy EURGBP) open two market orders with recommended Lot size, TP and SL levels. Set the TP on one to 0 to allow profits to run if it trends strongly. Total risk is split between both trades, so for 2% total risk you would use 1% risk on each. You can also use a trade assistant such as this one or this one (easier to use but can slow down charts).
6. Click and drag the next pair in the Market Watch window onto the chart to change it. Alternatively, use a symbol changer indicator such as this one to do this more easily (double-click to refresh NNFX Strength quicker).
7. If a trade signal is given open two market orders like before (ie, 0.2 lots + 0.2 lots = 0.4 lots risk total). 
8. Repeat this for all 28 Forex pairs, being careful not to become overexposed in one particular currency (ie, EUR or GBP). If you do want to take all trades given, lower the lot size risk of all your trades to accomodate with Lots_Risk_Percent.
9. Walk away! Come back tomorrow at the same time to check and manage your trades. Watching and micro-managing your trades throughout the day will increase your chances of letting emotions ruin your success.

There are other specific rules set out by VP that relate to the different indicator components of an NNFX algorithm (Baseline, Confirmation, Continuation, etc), however these do not apply if you are using NNFX Strength on its own.

If you want more confirmation for your trades, adding a baseline (moving average) would be the first step. Find a good moving average (there's a ton of them, All Averages is a good start), put it on the chart and adjust its period to help filter out any bad trades. Enable Show_History to view previous trade signals. When price is above the baseline Buy, when it is below Sell. 

Cut your losses and let your profits run.

As losses are an unavoidable part of the trading process, it is better to cut them off early before they reach StopLoss. A Hold or Exit signal will help to determine if a trade is not going as intended and will get you out of a bad trade earlier than if you wait for a trend reversal (exit signal). At the same time the opposite is true for profitable trades, it's best to hold onto them as long as possible. Therefore you will notice that when you have a group of trades open, you will be getting rid of the losses first and allowing the profitable ones to carry on the trend as long as possible. This is a better approach than simply closing all trades when you are in cumulative profit.

Keep an eye on Momentum.

A trend can exist when a pair of currency strength lines is either expanding OR contracting, it doesn't really matter which way they're moving but ideally they should be moving in opposite directions. The key is to keep an eye on the Momentum of movement. Increasing momentum is a good sign that the trend is strengthening and the trade will keep going in your favour. Decreasing momentum is a sign of trend exhaustion and indicates an approaching consolidation or reversal. Note that Momentum is the difference of the current and previous strength difference and is always expressed as an absolute (positive number).

Watch the Hold signals when backtesting.

When using Show_History to backtest or optimise the TRADE_Allow_Momentum_Threshold setting, notice that the Hold Buy or Hold Sell signals prevent new trade signals forming at the end of a trend swing. Therefore with the Trade threshold try to strike a good balance between an early signal and one that keeps you in the trade for as long as possible. Often the Trade threshold is better at a lower value (like 1.0 on H4) but this depends on the timeframe, MA and Currency strength settings.

Test different market sessions.

Each market session behaves differently so it is useful to test each one and see which works best for your strategy settings. The default setting for H4 disables trade signals for New York session because this time period impacts negatively on overall profits, whereas with different settings it might perform better than Sydney, Tokyo or London. Use Backtest mode to gauge which session is best for your custom settings to help eliminate losses. Make sure your GMT Offset is correct as this will affect the test results. When trading on D1 timeframe make sure all sessions are set to true.

NNFX Strength cannot be used in Strategy Tester because MT4 doesn't support multi-currency testing. The inbuilt Backtest display shows trade statistics for the specified indicator period, this display is enabled by Show_Backtest. To determine the overall profitability of your settings simply add the profits of each of the 28 currency pairs. For average WinRate and Profit Factor, add them all and divide the total by 28. The highest profit, profit factor and winrate with the least amount of trades is preferable.

Although unnecessary, if you want to backtest manually follow these steps...

Simple WinRate (faster but not as accurate)

• This method only uses one trade per trade signal to determine Win rate.
• Download the No Nonsense ATR indicator available here and load it on the same chart as NNFX Strength. 
• Open NNFX Strength settings and change Show_History to true.
• Using the mouse pointer, scan the history of trade signals. 
• Where a Buy signal exists, click once on the chart to show whether the trade is a Win or a Loss.
• Where a Sell signal exists, click twice on the chart to show whether the trade is a Win or a Loss.
• From left to right, tally up the total Wins and Losses then calculate as a percentage (Wins / (Wins + Losses) x 100).
• Do this for all 28 currency pairs then average the total.

Full Pip Test (accurate but slower)

• This method uses both trades to determine total pips made if traded continuously.
• Using the No Nonsense ATR indicator as above, scan for trade signals from left to right with the mouse pointer.
• For Buy signals click once on the chart, for Sell signals click twice.
• From the entry candle check each following candle after the trade signal. 
• If the trade reaches TP before there is a Hold or Exit signal, count the pips of the win for one trade.
• For the remaining trade (that doesn’t have TP) follow the trade signal as the candles progress.
• When the trade signal changes to Hold or Exit or the TREND changes direction, close the trade there. Drag the crosshair (middle mouse button) from the close of that candle to the close of the entry candle to determine how many pips the second trade would have made.
• If after hitting TP the second trade then hits Breakeven before a Hold or Exit signal, count the trade as 0.
• If SL is hit before a Hold or Exit signal or hitting TP, count both losses.
• Add the pips of the two trades together and move onto the next trade signal.
• Do this for all 28 currency pairs and add them together.