FLD Trading Strategy (Advanced)
While the original FLD trading strategy is powerful in it's own right, combining two or more FLDs brings additional benefits, which we will explore here.
Expanding and Combining
The FLD trading strategy, explored piece by piece in the basic FLD trading strategy article, is a wonderful addition to our Hurst based kit of trading tools. The breakdown of trades into relatively easy to recognise and categorise interactions with an FLD provides an insight into both the underlying status of a market and what is immediately to come. We can, however, improve upon the strategy by combining several signal FLDs to inform us of optimal trading decisions.
To do this we need two or more trading cycles at increasing periods and which have harmonic ratios of 2:1 with nearby components. We have found the ideal is 3 discrete trading cycles, providing an excellent combination of high reward, low risk entries with a longer term outlook based upon higher degree FLD interactions.