FX5 Forex Trading Strategy
FX5 forex trading strategy is a simple and effective trend following method for any major exchange rate. I hope you can adapt this strategy to suit your trading style.
Strategy Description: An intra day forex trend following trading method, using the
following technical indicators:
• 10 period WMA (Weighted Moving Average)
• 20 period SMA (Simple Moving Average)
• Slow Stochastic (10,6,6 (exponential))
• RSI (28)
• MACD (24/52/18 (exponential))
Forex Trading Rules:
1) Only take trades between 8AM-12PM EST and/or 2AM-4AM EST.
2) BUY the exchange rate when the 10 WMA crosses up past the 20 SMA and the Stochastic is signaling up (fast line above the slow line), RSI > 50 and the MACD histogram >0 and MACD averages crossed up.
3) SELL the exchange rate when the 10 WMA crosses down past the 20 SMA and the Stochastic is signaling down (fast line below slow line), RSI<50 and the MACD histogram <0 and MACD averages crossed down. 4) Try and take profits at or near key levels: Try and take profits at exchange rates ending with 00, 20, 50, 80 e.g. EUR/USD 1.1980 5) Stop-Loss Level: discretionary or below/above most recent level of support and resistance.
----- by Erol Bortucene -------
Showing posts with label forex trading strategy. Show all posts
Showing posts with label forex trading strategy. Show all posts
Sunday, April 10, 2011
Sunday, January 9, 2011
ANSATSU Forex Strategy - Free Download
Free Download - Ansatsu Trend Follower System
As you probably know, the Forex markets sometimes trend and sometime range, right?
Well, I just downloaded a Indicator & PDFfile explaining the "Trend+Range" system which claims to trade profitably BOTH the trend AND the range using the same system.
This system is designed for longer time frames, it’s a trend following system that just ride the trend to the maximum profit, you can use shorter time frames but you will be exposed to more market noise,
Here's the free download link: Ansatsu Trend Follower System / Template
This system is based on a few custom-coded indicators for the MetaTrader platform, so you need to download the MetaTrader platform first.
Happy Trading - SBUDIJ
As you probably know, the Forex markets sometimes trend and sometime range, right?
Well, I just downloaded a Indicator & PDFfile explaining the "Trend+Range" system which claims to trade profitably BOTH the trend AND the range using the same system.
This system is designed for longer time frames, it’s a trend following system that just ride the trend to the maximum profit, you can use shorter time frames but you will be exposed to more market noise,
Here's the free download link: Ansatsu Trend Follower System / Template
This system is based on a few custom-coded indicators for the MetaTrader platform, so you need to download the MetaTrader platform first.
Happy Trading - SBUDIJ
Sunday, August 8, 2010
Forex Trading Strategy - Double Doji
The Secret of the Double Doji
Today we've got you a complimentary PDF describing one
of the simplest but most profitable strategies you can ever
use in your FX trading...
Secret Of The Double Doji…. Click here - Free Download PDF
The strategy was created by Vladimir Ribakov, one of the
finest traders around. Vladimir is one of a VERY few people
who actually trades for a living.
The "Doji" pattern is one of the most incredible patterns among the
Japanese candlesticks. For some reason it is not referred to very often.
Maybe that explains why it is extensively used by pros…
The Doji hints us that the market is in a state of balance of powers: the buyers' strength has run our, but so is the sellers'. So this is a state of temporary calmness, just before a major move.
The shape of the candle can tell us all. Every candle tells its part of the complete story. We just need to learn how to put together this puzzle.
I found it to work best on the 1-hour, 4-hours and daily charts.
The best currency pairs are the ones that involve the USD, and also all
the Yen crosses (EUR/JPY, GBP/JPY, AUD/JPY etc.)
I'm proud to have the opportunity to present to you such a successful
strategy, and to help you reach your financial goals.
...sbudij....by; Vladimir Ribakov
Today we've got you a complimentary PDF describing one
of the simplest but most profitable strategies you can ever
use in your FX trading...
Secret Of The Double Doji…. Click here - Free Download PDF
The strategy was created by Vladimir Ribakov, one of the
finest traders around. Vladimir is one of a VERY few people
who actually trades for a living.
The "Doji" pattern is one of the most incredible patterns among the
Japanese candlesticks. For some reason it is not referred to very often.
Maybe that explains why it is extensively used by pros…
The Doji hints us that the market is in a state of balance of powers: the buyers' strength has run our, but so is the sellers'. So this is a state of temporary calmness, just before a major move.
The shape of the candle can tell us all. Every candle tells its part of the complete story. We just need to learn how to put together this puzzle.
I found it to work best on the 1-hour, 4-hours and daily charts.
The best currency pairs are the ones that involve the USD, and also all
the Yen crosses (EUR/JPY, GBP/JPY, AUD/JPY etc.)
I'm proud to have the opportunity to present to you such a successful
strategy, and to help you reach your financial goals.
...sbudij....by; Vladimir Ribakov
Sunday, December 6, 2009
Forex ; Trading Double Tops and Double Bottoms
Trading Double Tops and Double Bottoms
No chart pattern is more common in trading than the double bottom or double top. In fact this pattern appears so often that it alone may serve as proof positive that price action is not as wildly random as many academics claim. Price charts simply express trader sentiment and double tops and double bottoms represent a re-testing of temporary extremes. If prices were truly random, why do they pause so frequently at just those points? To traders the answer is that many participants are making their stand at those clearly demarcated levels.
If these levels undergo and repel attacks, they instill even more confidence in the traders who've defended the barrier and, as such, are likely to generate strong profitable countermoves. Here we look at the difficult task of spotting the important double bottom and double tops, and we demonstrate how Bollinger Bands can help you set appropriate stops when you're trading these patterns.
React or Anticipate?
One great criticism of technical pattern trading is that setups always look obvious in hindsight but that executing them in real time is actually very difficult. Double tops and double bottoms are no exception. Though these patterns appear almost daily, successfully identifying and trading them is no easy task.
There are two approaches to this problem and both have their merits and drawbacks. In short, traders can either anticipate these formations or wait for confirmation and react to them. Which approach you chose is more a function of your personality than relative merit. Those who have a fader mentality - who love to fight the tape, sell into strength and buy weakness - will try to anticipate the pattern by stepping in front of the price move.
Reactive traders, who want to see confirmation of the pattern before entering, have the advantage of knowing that the pattern exists but there's a tradeoff: they must pay worse prices and suffer greater losses should the pattern fail.
What's Obvious Is Not Often Right
Most traders are inclined to place a stop right at the bottom of a double bottom or top of the double top. The conventional wisdom says that once the pattern is broken, the trader should get out. But conventional wisdom is often wrong.
Leaving the trade early may seem prudent and logical, but markets are rarely that straightforward. Many retail traders play double tops/bottoms, and, knowing this, dealers and institutional traders love to exploit the retail traders' behavior of exiting early, forcing the weak hands out of the trade before price changes direction. The net effect is a series of frustrating stops out of positions that often would have turned out to be successful trades.
What Are Stops For?
Most traders make the mistake of using stops for risk control. But risk control in trading should be achieved through proper position size, not stops. The general rule of thumb is never to risk more than 2% of capital per trade. For smaller traders, that can sometimes mean ridiculously small trades.
Fortunately in FX where many dealers allow flexible lot sizes, down to one unit per lot - the 2% rule of thumb is easily possible. Nevertheless, many traders insist on using tight stops on highly leveraged positions. In fact, it is quite common for a trader to generate 10 consecutive losing trades under such tight stop methods. So, we could say that in FX, instead of controlling risk, ineffective stops might even increase it. Their function, then, is to determine the highest probability for a point of failure. An effective stop poses little doubt to the trader over whether he or she is wrong.
Implementing the True Function of Stops
A technique using Bollinger Bands can help traders set those proper stops. Because Bollinger Bands incorporate volatility by using standard deviations in their calculations, they can accurately project price levels at which traders should abandon their trades.
The method for using Bollinger-Bands stops for double tops and double bottoms is quite simple:
1. Isolate the point of the first top or bottom, and overlay Bollinger Bands with four standard-deviation parameters.
2. Draw a line from the first top or bottom to the Bollinger Band. The point of intersection becomes your stop.
At first glance four standard deviations may seem like an extreme choice. After all, two standard deviations cover 95% of possible scenarios in a normal distribution of a dataset. However, all those who have traded financial markets know that price action is anything but normal - if it were, the type of crashes that happen in financial markets every five or 10 years would occur only once every 6,000 years. Classic statistical assumptions are not very useful for traders. Therefore setting a wider standard-deviation parameter is a must.
The four standard deviations cover more than 99% of all probabilities and therefore seem to offer a reasonable cut-off point. More importantly they work well in actual testing, providing stops that are not too tight, yet not so wide as to become prohibitively costly. Note how well they work on the following GBP/USD example.
More importantly, take a look at the next example. A true sign of a proper stop is a capacity to protect the trader from runaway losses. In the following chart, the trade is clearly wrong but is stopped out well before the one-way move causes major damage to the trader's account.
Conclusion
The genius of Bollinger Bands is their adaptability. By constantly incorporating volatility, they adjust quickly to the rhythm of the market. Using them to set proper stops when trading double bottoms and double tops - the most frequent price patterns in forex - makes those common trades much more effective.
--- by; Boris Schlossberg / director of currency research at GFT Forex. ----
No chart pattern is more common in trading than the double bottom or double top. In fact this pattern appears so often that it alone may serve as proof positive that price action is not as wildly random as many academics claim. Price charts simply express trader sentiment and double tops and double bottoms represent a re-testing of temporary extremes. If prices were truly random, why do they pause so frequently at just those points? To traders the answer is that many participants are making their stand at those clearly demarcated levels.
If these levels undergo and repel attacks, they instill even more confidence in the traders who've defended the barrier and, as such, are likely to generate strong profitable countermoves. Here we look at the difficult task of spotting the important double bottom and double tops, and we demonstrate how Bollinger Bands can help you set appropriate stops when you're trading these patterns.
React or Anticipate?
One great criticism of technical pattern trading is that setups always look obvious in hindsight but that executing them in real time is actually very difficult. Double tops and double bottoms are no exception. Though these patterns appear almost daily, successfully identifying and trading them is no easy task.
There are two approaches to this problem and both have their merits and drawbacks. In short, traders can either anticipate these formations or wait for confirmation and react to them. Which approach you chose is more a function of your personality than relative merit. Those who have a fader mentality - who love to fight the tape, sell into strength and buy weakness - will try to anticipate the pattern by stepping in front of the price move.
Reactive traders, who want to see confirmation of the pattern before entering, have the advantage of knowing that the pattern exists but there's a tradeoff: they must pay worse prices and suffer greater losses should the pattern fail.
What's Obvious Is Not Often Right
Most traders are inclined to place a stop right at the bottom of a double bottom or top of the double top. The conventional wisdom says that once the pattern is broken, the trader should get out. But conventional wisdom is often wrong.
Leaving the trade early may seem prudent and logical, but markets are rarely that straightforward. Many retail traders play double tops/bottoms, and, knowing this, dealers and institutional traders love to exploit the retail traders' behavior of exiting early, forcing the weak hands out of the trade before price changes direction. The net effect is a series of frustrating stops out of positions that often would have turned out to be successful trades.
What Are Stops For?
Most traders make the mistake of using stops for risk control. But risk control in trading should be achieved through proper position size, not stops. The general rule of thumb is never to risk more than 2% of capital per trade. For smaller traders, that can sometimes mean ridiculously small trades.
Fortunately in FX where many dealers allow flexible lot sizes, down to one unit per lot - the 2% rule of thumb is easily possible. Nevertheless, many traders insist on using tight stops on highly leveraged positions. In fact, it is quite common for a trader to generate 10 consecutive losing trades under such tight stop methods. So, we could say that in FX, instead of controlling risk, ineffective stops might even increase it. Their function, then, is to determine the highest probability for a point of failure. An effective stop poses little doubt to the trader over whether he or she is wrong.
Implementing the True Function of Stops
A technique using Bollinger Bands can help traders set those proper stops. Because Bollinger Bands incorporate volatility by using standard deviations in their calculations, they can accurately project price levels at which traders should abandon their trades.
The method for using Bollinger-Bands stops for double tops and double bottoms is quite simple:
1. Isolate the point of the first top or bottom, and overlay Bollinger Bands with four standard-deviation parameters.
2. Draw a line from the first top or bottom to the Bollinger Band. The point of intersection becomes your stop.
At first glance four standard deviations may seem like an extreme choice. After all, two standard deviations cover 95% of possible scenarios in a normal distribution of a dataset. However, all those who have traded financial markets know that price action is anything but normal - if it were, the type of crashes that happen in financial markets every five or 10 years would occur only once every 6,000 years. Classic statistical assumptions are not very useful for traders. Therefore setting a wider standard-deviation parameter is a must.
The four standard deviations cover more than 99% of all probabilities and therefore seem to offer a reasonable cut-off point. More importantly they work well in actual testing, providing stops that are not too tight, yet not so wide as to become prohibitively costly. Note how well they work on the following GBP/USD example.
More importantly, take a look at the next example. A true sign of a proper stop is a capacity to protect the trader from runaway losses. In the following chart, the trade is clearly wrong but is stopped out well before the one-way move causes major damage to the trader's account.
Conclusion
The genius of Bollinger Bands is their adaptability. By constantly incorporating volatility, they adjust quickly to the rhythm of the market. Using them to set proper stops when trading double bottoms and double tops - the most frequent price patterns in forex - makes those common trades much more effective.
--- by; Boris Schlossberg / director of currency research at GFT Forex. ----
Saturday, November 28, 2009
Forex ; Ross Hook Trading Strategy
Joe Ross has been trading and investing since his first trade at the age of 14, and is a well known Master Trader and Investor. He has survived all the up and downs of the markets because of his adaptable trading style, using a low-risk approach that produces consistent profits. Joe Ross is the creator of the Ross Hook ™ (Rh), and has set new standards for low-risk trading with his concepts of "The Law of Charts™" and the "Traders Trick Entry™" (TTE). Joe Ross has a few preferred trading signals, but we will present here the Ross Hook and the Traders Trick Entry.
Ross hook could be created on charts after:
1. First correction after a 1-2-3 pattern breakout;
2. First correction after a ledge pattern breakout (A ledge consists of a minimum of four price bars. It must have two matching lows and two matching highs. The matching highs must be separated by at least one price bar, and the matching lows must be separated by at least one price bar.);
First correction after a trading range breakout (A Trading Range is similar to a ledge, but must consist of more than ten price bars.).
The definitions are from "Law of Charts" by Joe Ross. This is very useful reading also.
During an uptrend when the market fails to make new high, a Ross Hook is formed. During a downtrend when the market fails to make new low, a Ross Hook is formed. Every directional price move reaches a point of exhaustion and needs new participants to continue. That is why the market takes its breath and at this point a Ross hook occurs. The Ross hook could be identified when the market is trending not when it is in a phase of consolidation. We skip the signal if the market opens with gap beyond the Ross Hook.
With the Traders Trick Entry TTE we try to open position before the other traders. We can make profits in trading only if we take other people's money. We have to learn how we can be one step ahead of the other market players. When Ross Hook, 1-2-3 pattern or other chart formation occurs most of the traders will place their orders at these levels. The Big boys know this very well and often target these order to make easy profits. They move the prices towards the nearest major level and activate the orders around only to reverse the price movement towards the stop losses. TTE is designed for such cases. When we see Ross hook and expect a test of this level we try to open a position early and make a nice profit if the break is successful with good risk/reward ratio. In most of the cases if the break of the Rh is false we can close our position with small profit
Long Position
1. The high of the last period is lower than the high of the previous Ross hook is formed;
2. The price retraces lower and the high of every period is lower than the previous one. The retracement should be 3-5 periods max;
3. We place a buy order above the high of the last period with stop loss below its low;
4. When the long position is opened we place limit order according to our money management rules. We suggest closing part of the position and move the stop loss to break even when the Rh level is reached.
Short Position
1. The low of the last period is higher than the low of the previous Ross hook is formed;
2. The price retraces higher and the low of every period is higher than the previous one. The retracement should be 3-5 periods max;
3. We place a sell order below the low of the last period with stop loss above its high;
4. When the short position is opened we place limit order according to our money management rules. We suggest closing part of the position and move the stop loss to break even when the Rh level is reached.
---- by : Svetlin Minev ------
Ross hook could be created on charts after:
1. First correction after a 1-2-3 pattern breakout;
2. First correction after a ledge pattern breakout (A ledge consists of a minimum of four price bars. It must have two matching lows and two matching highs. The matching highs must be separated by at least one price bar, and the matching lows must be separated by at least one price bar.);
First correction after a trading range breakout (A Trading Range is similar to a ledge, but must consist of more than ten price bars.).
The definitions are from "Law of Charts" by Joe Ross. This is very useful reading also.
During an uptrend when the market fails to make new high, a Ross Hook is formed. During a downtrend when the market fails to make new low, a Ross Hook is formed. Every directional price move reaches a point of exhaustion and needs new participants to continue. That is why the market takes its breath and at this point a Ross hook occurs. The Ross hook could be identified when the market is trending not when it is in a phase of consolidation. We skip the signal if the market opens with gap beyond the Ross Hook.
With the Traders Trick Entry TTE we try to open position before the other traders. We can make profits in trading only if we take other people's money. We have to learn how we can be one step ahead of the other market players. When Ross Hook, 1-2-3 pattern or other chart formation occurs most of the traders will place their orders at these levels. The Big boys know this very well and often target these order to make easy profits. They move the prices towards the nearest major level and activate the orders around only to reverse the price movement towards the stop losses. TTE is designed for such cases. When we see Ross hook and expect a test of this level we try to open a position early and make a nice profit if the break is successful with good risk/reward ratio. In most of the cases if the break of the Rh is false we can close our position with small profit
Long Position
1. The high of the last period is lower than the high of the previous Ross hook is formed;
2. The price retraces lower and the high of every period is lower than the previous one. The retracement should be 3-5 periods max;
3. We place a buy order above the high of the last period with stop loss below its low;
4. When the long position is opened we place limit order according to our money management rules. We suggest closing part of the position and move the stop loss to break even when the Rh level is reached.
Short Position
1. The low of the last period is higher than the low of the previous Ross hook is formed;
2. The price retraces higher and the low of every period is higher than the previous one. The retracement should be 3-5 periods max;
3. We place a sell order below the low of the last period with stop loss above its high;
4. When the short position is opened we place limit order according to our money management rules. We suggest closing part of the position and move the stop loss to break even when the Rh level is reached.
---- by : Svetlin Minev ------
Wednesday, November 18, 2009
Forex Trading Strategies : DMI and Psar
Directional Movement Index and Parabolic SAR
DMI and Parabolic SAR are very efficient trend indicators and are used often by traders for developing of their strategies. These indicators could be used separately and in combination with other technical studies. The DMI system is plotted by three lines: ADX, +DI and -DI, and could be used for generating of signals or trend filter:
Rising ADX shows that the market has a clear direction and is in a trending mode;
Declining ADX shows that the trend is losing steam or the market is in consolidation phase;
When ADX is above 20-25, the market is in a clear trend.
DMI system generates the following signals:
Rules for long position
1. ADX is above 25 and rising;
2. The Parabolic SAR goes form below to above the chart of the price. The bar when this happens is marked as Signal bar.
3. Long position is initiated when the price breaks 2-3 pips above the high of the Signal bar.
4. After the position is open an initial stop loss order is placed 2-3 pips below the low of the signal bar.
5. A limit order is placed according our Money management rules.
Rules for short position
1. ADX is above 25 and rising;
2. The Parabolic SAR goes form above to below the chart of the price. The bar when this happens is marked as Signal bar..
3. Short position is initiated when the price breaks 2-3 pips below the low of the Signal bar.
4. After the position is open an initial stop loss order is placed 2-3 pips above the high signal bar.
5. A limit order is placed according to our Money management rules.
Indicator chart
----- by ; Svetlin Minev / M.Popov ------
DMI and Parabolic SAR are very efficient trend indicators and are used often by traders for developing of their strategies. These indicators could be used separately and in combination with other technical studies. The DMI system is plotted by three lines: ADX, +DI and -DI, and could be used for generating of signals or trend filter:
Rising ADX shows that the market has a clear direction and is in a trending mode;
Declining ADX shows that the trend is losing steam or the market is in consolidation phase;
When ADX is above 20-25, the market is in a clear trend.
DMI system generates the following signals:
Rules for long position
1. ADX is above 25 and rising;
2. The Parabolic SAR goes form below to above the chart of the price. The bar when this happens is marked as Signal bar.
3. Long position is initiated when the price breaks 2-3 pips above the high of the Signal bar.
4. After the position is open an initial stop loss order is placed 2-3 pips below the low of the signal bar.
5. A limit order is placed according our Money management rules.
Rules for short position
1. ADX is above 25 and rising;
2. The Parabolic SAR goes form above to below the chart of the price. The bar when this happens is marked as Signal bar..
3. Short position is initiated when the price breaks 2-3 pips below the low of the Signal bar.
4. After the position is open an initial stop loss order is placed 2-3 pips above the high signal bar.
5. A limit order is placed according to our Money management rules.
Indicator chart
----- by ; Svetlin Minev / M.Popov ------
Friday, November 6, 2009
Forex Trading Indicator
Fx Indicator's ; Elliott Wave Oscillator, Juice and MA” -
the currency pair EURUSD (but you can choose any other, the selection of suitable values of stop-loss, profit and trailing stop),
a time-frame - M30 - MetaTrader4
Indicators Forex:
1) Exponential Moving Average EMA (200), applied to a close, the color blue.
2) Exponential Moving Average EMA (50), applied to a close, the color red.
3) Oscillator Elliott Wave Oscillator.
4) indicator of the level of Juice 0,0004.
Open a deal to BUY conclude with the following conditions:
1) Price is above the 2 moving averages EMA (200) and EMA (50), and the trend is upward, as indicated by the intersection of bullish Moving Averages (red above blue)
2) Oscillator Elliott Wave Oscillator crossed its zero line and closed above it.
3) Juice indicator is above its level of 0.0004.
Take-profit set to a value of 100 points from the entrance to the market.
Stop-loss - 20 points, trailing stop just 20 points.
Open a deal to SELL is when the following conditions:
1) Price is below the 2 moving average EMA (200) and EMA (50), while the trend is downward, as indicated by the intersection Moving Averages bearish (red below blue)
2) Oscillator Elliott Wave Oscillator crossed its zero line and closed below it.
3) Juice indicator is above its level of 0.0004.
Take-profit as set on the value of 100 points from the entrance to the market.
Stop-loss, respectively - 20 points, trailing stop - 20 points.
----- by ; ForexStrategies ----
the currency pair EURUSD (but you can choose any other, the selection of suitable values of stop-loss, profit and trailing stop),
a time-frame - M30 - MetaTrader4
Indicators Forex:
1) Exponential Moving Average EMA (200), applied to a close, the color blue.
2) Exponential Moving Average EMA (50), applied to a close, the color red.
3) Oscillator Elliott Wave Oscillator.
4) indicator of the level of Juice 0,0004.
Open a deal to BUY conclude with the following conditions:
1) Price is above the 2 moving averages EMA (200) and EMA (50), and the trend is upward, as indicated by the intersection of bullish Moving Averages (red above blue)
2) Oscillator Elliott Wave Oscillator crossed its zero line and closed above it.
3) Juice indicator is above its level of 0.0004.
Take-profit set to a value of 100 points from the entrance to the market.
Stop-loss - 20 points, trailing stop just 20 points.
Open a deal to SELL is when the following conditions:
1) Price is below the 2 moving average EMA (200) and EMA (50), while the trend is downward, as indicated by the intersection Moving Averages bearish (red below blue)
2) Oscillator Elliott Wave Oscillator crossed its zero line and closed below it.
3) Juice indicator is above its level of 0.0004.
Take-profit as set on the value of 100 points from the entrance to the market.
Stop-loss, respectively - 20 points, trailing stop - 20 points.
----- by ; ForexStrategies ----
Forex - Polarized Fractal Efficiency
Polarized Fractal Efficiency - PFE indicator - draws on Mandelbrot and fractal geometry to depict how pricing moves between 2 points during a definite time period. The more linear and efficient the price fluctuation, the shorter the distance the prices must move. the Polarized Fractal Efficiency indicator was created by Hans Hanula.
The PFE indicator is used for calculation of how trendy or overloaded the price action is. PFE <> 0 - indicate that the trend is up. The higher the reading the "trendier" and more efficient the upward movement. Readings around zero show jerky, less efficient shift and a balance between demand and supply
A hooking pattern often happens right before an efficient period finishes when the PFE appears to have maxed out, turns in the contrary direction towards zero, and then makes one last attempt at max. efficiency.
Stay with the trade all the way to the other extreme, unless it slows around the zero line. If it slows around zero, exit the trade and wait for a new max. efficiency entry.Trades can be entered in the opposite direction, with a stop just beyond the extreme of the hook.
The PFE indicator is used for calculation of how trendy or overloaded the price action is. PFE <> 0 - indicate that the trend is up. The higher the reading the "trendier" and more efficient the upward movement. Readings around zero show jerky, less efficient shift and a balance between demand and supply
A hooking pattern often happens right before an efficient period finishes when the PFE appears to have maxed out, turns in the contrary direction towards zero, and then makes one last attempt at max. efficiency.
Stay with the trade all the way to the other extreme, unless it slows around the zero line. If it slows around zero, exit the trade and wait for a new max. efficiency entry.Trades can be entered in the opposite direction, with a stop just beyond the extreme of the hook.
Tuesday, October 27, 2009
Forex Trading Strategy - Bagovino Method
Forex Strategy “Method Bagovino” very simple, trade is conducted on the 1-hourly chart (H1), it must install EMA (close) with a period of 5 and 21. And as RSI indicator with a period of 21. All these indicators are in any standard set of terminal Metatrader 4.
In installations RSI indicator determines the level of 50.
Once the 5 and 21 EMA cross and up, and RSI indicator crosses a bottom-up level 50 - open the deal to buy (remember - the transaction should be opened only after the closing hour candles and candle digging the new hours!)
Conversely, as soon as the EMA cross on the graph down, and the RSI indicator falls below 50 - opening the deal to sell (remember - the transaction should be opened only after the closing hour candles and candle digging the new hours!) The best situation as soon as Both intersections occur simultaneously (the intersection of EMA and RSI indicator crosses a level 50).
This forex strategy at history has shown about 85% of profitable signals!
For work, you can choose any currency pair.
Examples see in the picture:
The first time (the situation on the left) - First there was the intersection Movings, but we had a deal only a few hours later, after the RSI has crossed the level of 50 and closed below it.
The second time (the situation on the right) - the intersection Movings and RSI occurred for 1 hour, an hour after closing a deal was made for the purchase.
Stop-loss recommend stavt at your discretion (subject to approval by you MM (risk management) - as you see fit, but I still recommend risking no more than 0,5-2% of the depot for each transaction and stop-loss set: purchase - below the previous low candle in the sale - maximum above last candle).
Also propose to use the indicator forex Vegas 1 Hour to determine the levels for the partial closure profitnyh trade positions. For example, you have opened a bargain on a signal Bagovino 0.3 lots. On the first line can close the 0.1 unit, and the rest put in the level “zero” (well suited for this trailing stop). On the second line cover is 0,1 lot, and have the remainder of the latter can close or you can just pull it into profit and into the “free floating”, treylenguya rest position such as at a distance of 25-50 points, while hoping to catch a trending move.
In installations RSI indicator determines the level of 50.
Once the 5 and 21 EMA cross and up, and RSI indicator crosses a bottom-up level 50 - open the deal to buy (remember - the transaction should be opened only after the closing hour candles and candle digging the new hours!)
Conversely, as soon as the EMA cross on the graph down, and the RSI indicator falls below 50 - opening the deal to sell (remember - the transaction should be opened only after the closing hour candles and candle digging the new hours!) The best situation as soon as Both intersections occur simultaneously (the intersection of EMA and RSI indicator crosses a level 50).
This forex strategy at history has shown about 85% of profitable signals!
For work, you can choose any currency pair.
Examples see in the picture:
The first time (the situation on the left) - First there was the intersection Movings, but we had a deal only a few hours later, after the RSI has crossed the level of 50 and closed below it.
The second time (the situation on the right) - the intersection Movings and RSI occurred for 1 hour, an hour after closing a deal was made for the purchase.
Stop-loss recommend stavt at your discretion (subject to approval by you MM (risk management) - as you see fit, but I still recommend risking no more than 0,5-2% of the depot for each transaction and stop-loss set: purchase - below the previous low candle in the sale - maximum above last candle).
Also propose to use the indicator forex Vegas 1 Hour to determine the levels for the partial closure profitnyh trade positions. For example, you have opened a bargain on a signal Bagovino 0.3 lots. On the first line can close the 0.1 unit, and the rest put in the level “zero” (well suited for this trailing stop). On the second line cover is 0,1 lot, and have the remainder of the latter can close or you can just pull it into profit and into the “free floating”, treylenguya rest position such as at a distance of 25-50 points, while hoping to catch a trending move.
Tuesday, October 20, 2009
Forex Scalping Strategy
Using Fibonacci Levels for Scalping the Forex Market
This article is part of our guide on how to use scalping tequniques to trade forex. If you haven't already we recommend you read the first part of series on forex scalping.
Scalping a strongly trending market is very different from scalping a quiet, tame market where price action is confined in a small range and is going nowhere. In a ranging market scalpers will buy or sell, and wait until the price comes back to where it left, and keep gathering small profits until the prevailing range pattern is eliminated. When trading a trending market, however, we must be careful to ensure that our orders follow the established trend. Counter-trend scalping is also possible, but since the preferred strategy of most successful traders is trend following, we’ll concentrate our attention on using fibonacci extensions in a trend following method in this article.
High volatility requires a strict approach to realizing both losses and profits. A scalper who is trading in a tame, range-bound market can be a bit more relaxed and arbitrary about his risk controls (they must still be applied with discipline, but not in the robotic manner which must be applied in trending markets), because the market is not expected to make sharp movements due to fewer market participants and a smaller amount of liquidity (not to mention that there is no news catalyst for strong price movements.) But a trend scalper must deal with such conditions at all times.
Trend Following Method
In this section we’ll discuss the use of the Fibonacci extension levels for the determination of trade direction while scalping trending markets. Scalping in trends can be difficult, because of the size of the sudden fluctuations, and the lack of clarity (at least in the short term) with respect to the eventual destination of the price. The Fibonacci extension levels are very useful in analyzing trends in all cases, and scalping is no exception to the rule
Our aim in using this indicator is identifying levels where the price may rebound. For drawing the extension, we’ll identify the beginning and end of the price movement which we expect to be extended, so to speak, in order that a new trend is created. In the 5-minute chart of the USDCHF pair, we have identified a sudden and sharp movement beginning at around 4 am on 23rd July, and decided to draw its extension after the first red bar where its momentum is temporarily checked. Upon drawing the extension in the indicated area, we notice the 61.8, 100, and 161.8 extensions of the first movement.
Careful examination of the chart above shows us not only that the price rebounded several times at the extension levels of the indicator, but also that these levels served as strong attractors pulling the price towards themselves. The 100 percent extension level, for instance, provided a support which prevented the price from “falling through” twice, as observed. And the other two levels similarly created performance bars for the trend which, once broken, created further momentum for the trend.
Trading against a trend is dangerous, and the risk of sudden reversals is no less dangerous for scalpers. As such we need a tool which will help us identify the general direction of the trend, so that even if we suffer some losses, eventually our gains will justify our trading activity. The Fibonacci extension level is a great tool for this purpose since it allows us to guess with a reasonable degree of accuracy the main momentum of the price action. In the above example, we’d be scalping the market by buying at the red arrows shown on the chart. If the price returned to the resistance or support levels indicated by the extension level, we’d stop trading for a while and await the market action to present some clarity (is the trend reversing?) But as long as the trend is intact our strategy would involve scalping between the extension levels to accumulate profits.
---- by; forextraders.com ----
This article is part of our guide on how to use scalping tequniques to trade forex. If you haven't already we recommend you read the first part of series on forex scalping.
Scalping a strongly trending market is very different from scalping a quiet, tame market where price action is confined in a small range and is going nowhere. In a ranging market scalpers will buy or sell, and wait until the price comes back to where it left, and keep gathering small profits until the prevailing range pattern is eliminated. When trading a trending market, however, we must be careful to ensure that our orders follow the established trend. Counter-trend scalping is also possible, but since the preferred strategy of most successful traders is trend following, we’ll concentrate our attention on using fibonacci extensions in a trend following method in this article.
High volatility requires a strict approach to realizing both losses and profits. A scalper who is trading in a tame, range-bound market can be a bit more relaxed and arbitrary about his risk controls (they must still be applied with discipline, but not in the robotic manner which must be applied in trending markets), because the market is not expected to make sharp movements due to fewer market participants and a smaller amount of liquidity (not to mention that there is no news catalyst for strong price movements.) But a trend scalper must deal with such conditions at all times.
Trend Following Method
In this section we’ll discuss the use of the Fibonacci extension levels for the determination of trade direction while scalping trending markets. Scalping in trends can be difficult, because of the size of the sudden fluctuations, and the lack of clarity (at least in the short term) with respect to the eventual destination of the price. The Fibonacci extension levels are very useful in analyzing trends in all cases, and scalping is no exception to the rule
Our aim in using this indicator is identifying levels where the price may rebound. For drawing the extension, we’ll identify the beginning and end of the price movement which we expect to be extended, so to speak, in order that a new trend is created. In the 5-minute chart of the USDCHF pair, we have identified a sudden and sharp movement beginning at around 4 am on 23rd July, and decided to draw its extension after the first red bar where its momentum is temporarily checked. Upon drawing the extension in the indicated area, we notice the 61.8, 100, and 161.8 extensions of the first movement.
Careful examination of the chart above shows us not only that the price rebounded several times at the extension levels of the indicator, but also that these levels served as strong attractors pulling the price towards themselves. The 100 percent extension level, for instance, provided a support which prevented the price from “falling through” twice, as observed. And the other two levels similarly created performance bars for the trend which, once broken, created further momentum for the trend.
Trading against a trend is dangerous, and the risk of sudden reversals is no less dangerous for scalpers. As such we need a tool which will help us identify the general direction of the trend, so that even if we suffer some losses, eventually our gains will justify our trading activity. The Fibonacci extension level is a great tool for this purpose since it allows us to guess with a reasonable degree of accuracy the main momentum of the price action. In the above example, we’d be scalping the market by buying at the red arrows shown on the chart. If the price returned to the resistance or support levels indicated by the extension level, we’d stop trading for a while and await the market action to present some clarity (is the trend reversing?) But as long as the trend is intact our strategy would involve scalping between the extension levels to accumulate profits.
---- by; forextraders.com ----
Friday, October 16, 2009
Forex Trading Strategy
3 Simple Breakout Strategies You Can Use When Trading Forex
This article describes three different ways you can trade forex breakouts.
Trading breakouts is one of the most popular methods of trading the forex markets because you often get large moves after a period of consolidation. So with that in mind, I've listed below three basic strategies you can use to trade these breakouts.
The first of which is based on technical analysis, and in particular the Bollinger Bands indicator. Bollinger Bands are envelopes based on a moving average and a standard deviation and are most useful in showing areas of support and resistance through the two outer lines of the envelope.
Therefore when the price breaks out of either the upper or lower limit, this very often is a strong indication that a breakout is about to take place in the same direction. It's particularly the case after a period of consolidation where the bandwidth of the Bollinger Bands has narrowed out. For greater success you can use the breaching of one of the outer lines to gain your attention, and then wait for a pullback to either the EMA (5) or EMA (20), for example, for a good entry point.
The second method you can use to trade breakouts is also based on technical analysis and involves various Exponential Moving Averages, or EMA's for short. This is a method I have developed over the years that makes use of the 5, 20 and 50 period EMA's (you can also use the 100 or 200 period EMA as well).
What you do is wait until the price, along with the 5, 20 and 50 period EMA's have all flattened out and are all very close to each other. Then you simply wait for a strong breakout from this narrow range and take a position close to the EMA (5) when the breakout takes place. This can be very rewarding when you catch a good breakout, particular when you use longer time frames.
The final method is based entirely on price and uses no technical indicators at all. It's based on the fact that the price does not stay in the same range forever and will at some point break out of the current trading range.
I have to admit I don't use this method myself but there are various ways you can trade this way. Some traders like to use the previous day's upper and lower price range, and trade any breakouts of this range the following day. Similarly some traders wait until a very narrow price range has formed and then wait for a breakout to occur.
So overall there are various different ways you can trade breakouts, all of which have their merits. Despite being quite basic methods, they can be extremely lucrative because the price often moves strongly in one direction or the other after a sustained period of consolidation.
This article describes three different ways you can trade forex breakouts.
Trading breakouts is one of the most popular methods of trading the forex markets because you often get large moves after a period of consolidation. So with that in mind, I've listed below three basic strategies you can use to trade these breakouts.
The first of which is based on technical analysis, and in particular the Bollinger Bands indicator. Bollinger Bands are envelopes based on a moving average and a standard deviation and are most useful in showing areas of support and resistance through the two outer lines of the envelope.
Therefore when the price breaks out of either the upper or lower limit, this very often is a strong indication that a breakout is about to take place in the same direction. It's particularly the case after a period of consolidation where the bandwidth of the Bollinger Bands has narrowed out. For greater success you can use the breaching of one of the outer lines to gain your attention, and then wait for a pullback to either the EMA (5) or EMA (20), for example, for a good entry point.
The second method you can use to trade breakouts is also based on technical analysis and involves various Exponential Moving Averages, or EMA's for short. This is a method I have developed over the years that makes use of the 5, 20 and 50 period EMA's (you can also use the 100 or 200 period EMA as well).
What you do is wait until the price, along with the 5, 20 and 50 period EMA's have all flattened out and are all very close to each other. Then you simply wait for a strong breakout from this narrow range and take a position close to the EMA (5) when the breakout takes place. This can be very rewarding when you catch a good breakout, particular when you use longer time frames.
The final method is based entirely on price and uses no technical indicators at all. It's based on the fact that the price does not stay in the same range forever and will at some point break out of the current trading range.
I have to admit I don't use this method myself but there are various ways you can trade this way. Some traders like to use the previous day's upper and lower price range, and trade any breakouts of this range the following day. Similarly some traders wait until a very narrow price range has formed and then wait for a breakout to occur.
So overall there are various different ways you can trade breakouts, all of which have their merits. Despite being quite basic methods, they can be extremely lucrative because the price often moves strongly in one direction or the other after a sustained period of consolidation.
Sunday, October 11, 2009
Forex Trading Strategy
Strategy for GBP/JPY
I’m going to explain the strategy I use to trade GJ and I’m going to be posting my weekly/daily analysis of this pair. I don’t use anything fancy, I use some basic stuff that most traders use and some common sense
The indicators I use are:
* Fibonacci retracement levels
* Trendlines/Channels
* 5 period simple MA
* Candlestick patterns
* Support/Resistance levels
* Momentum
As you can see it’s all simple and basic stuff except maybe for the fibonacci retracement, because every trader could use it differently. If you have any doubts about any of the stuff I use, either ask or just do a simple google search and you’ll find plenty of information about them.
Using the fibonacci retracement on different timeframes (1H, 4H, Daily, Weekly) is very important, because sometimes some of them overlap and that tells us where we might find strong support/resistance. I’ll post some examples.
If you have been following my posts on Auslanco’s thread, you will know that we use the 5SMA for a good entry point when a retracement occurs.
Most of the time, I trade based on the 4H chart, but I keep an eye on the daily chart and sometimes the weekly chart. I use the 1H chart for a good entry point. Any TF less than 1H has a lot of noise and it is very risky trading GJ on very small TF’s.
Using stop-loss, I always wait for my trade to go in my direction for about 50-100 pips before I move my SL and lock in a very small # of pips (10) and then just let it run until it reaches my TP, this way I don’t let a winning trade turn into a losing one, and if my SL gets hit, no worries coz +10 is way better than anything negative
Momentum & 5sma
Before using the Momentum indicator and 5sma, you must have auslanco’s QQE indicator. I’ll explain how to catch a retracement in this following example:
When QQE 4h is crossed upwards, and QQE 1hr is crossed upwards, and the Momentum at the beginning of the next 1h candle is pointing downwards, price will usually retrace to 1hr 5sma, it’s that simple.
---- by; KarmoStaji -------
I’m going to explain the strategy I use to trade GJ and I’m going to be posting my weekly/daily analysis of this pair. I don’t use anything fancy, I use some basic stuff that most traders use and some common sense
The indicators I use are:
* Fibonacci retracement levels
* Trendlines/Channels
* 5 period simple MA
* Candlestick patterns
* Support/Resistance levels
* Momentum
As you can see it’s all simple and basic stuff except maybe for the fibonacci retracement, because every trader could use it differently. If you have any doubts about any of the stuff I use, either ask or just do a simple google search and you’ll find plenty of information about them.
Using the fibonacci retracement on different timeframes (1H, 4H, Daily, Weekly) is very important, because sometimes some of them overlap and that tells us where we might find strong support/resistance. I’ll post some examples.
If you have been following my posts on Auslanco’s thread, you will know that we use the 5SMA for a good entry point when a retracement occurs.
Most of the time, I trade based on the 4H chart, but I keep an eye on the daily chart and sometimes the weekly chart. I use the 1H chart for a good entry point. Any TF less than 1H has a lot of noise and it is very risky trading GJ on very small TF’s.
Using stop-loss, I always wait for my trade to go in my direction for about 50-100 pips before I move my SL and lock in a very small # of pips (10) and then just let it run until it reaches my TP, this way I don’t let a winning trade turn into a losing one, and if my SL gets hit, no worries coz +10 is way better than anything negative
Momentum & 5sma
Before using the Momentum indicator and 5sma, you must have auslanco’s QQE indicator. I’ll explain how to catch a retracement in this following example:
When QQE 4h is crossed upwards, and QQE 1hr is crossed upwards, and the Momentum at the beginning of the next 1h candle is pointing downwards, price will usually retrace to 1hr 5sma, it’s that simple.
---- by; KarmoStaji -------
Friday, July 31, 2009
Forex Trading Strategy
Forex ; True and false Trendline Breakouts
When price breaks through a trend line, how can we tell whether it is a true or a false break? Well, we can't tell or predict until we see it later on. But, we can analyze what price has been doing prior to this breakout in order to form our own opinion and bias, and either pay attention to the breakout or disregard it.
We can always go back and look at waves pattern, or simply, whether price was making Lower Lows (LL), Lower Highs(LH), Higher Highs (HH) etc..?
Let's look at the next two screen shots:
(The market was in a downtrend. We drew a trend line connecting first two tops.
Price was obeying the line, but then at some point (where I put a yellow question mark), price breaks the trend line and closes above it.
How can we know at that moment whether we could trust this breakout or not?
The simplest and popular method is to wait till price returns back to test the strength of the broken trend line again. Then, if it holds, traders would say that a breakout is confirmed and enter either somewhere near the test point or when price advances through the earlier established breakout mark.
Here is a quick example (I drew the red candles myself to illustrate the point):
After the break of a trend line price returns, tests the line again, finds support and, as a result, goes up. Yellow dotted line indicates the point of entry with a Buy order.
BUT, this kind of re-tests don't happen all the time. Sometimes price would just break the line and advance further without looking back. What to do then?
This is why I like to look back at older data to learn what happened prior to the breakout.
What can we see on the first example (first screen shot above)?
Price was consistently making Lower Lows. But, most importantly, prior to
breaking a trend line, price made another Lower Low, telling us that Sellers were still strong and were able to push the price down. Based on this, we can say that this particular breakout that we were questioning cannot be "trusted". (I use the word "trusted", because whether the breakout was valid or not we will only learn later).
Now, let's look at the next example below:
Let's start form the beginning: price is making Higher Highs and we draw our red trend line.
At some point later the red trend line gets broken. Can we trust it? The answer is "no, we can't", because we still can see a higher high, which means that buyers were still able to push the price higher.
Few candles later price is bottoming out, attempts another up-move, but fails and puts a Lower High this time.
That's nothing else but a trigger that bulls are weakening and either one of the trend lines (solid or dashed in brown) which you'll be able to identify will become the point of truth: if it gets broken - the price is very likely to move lower.
That's it. A simple method, which might help you to judge about most likely outcomes of the trend line breakouts.
Remember, that in the uptrend you need to take into consideration only Swing Highs, in the down trend and for downtrend trend lines - only Swing Lows.
----- SBJ ------- by; Edward Revy & Team ------
Friday, July 10, 2009
Forex ; Trendline Support and Resistance
The trendline. A trendline is a main initial element for the price chart analysis. While the market moves in any direction not along a straight line but along a zigzag, the mutual placement of upper and bottom points of those zigzags permits to plot a line connecting the significant highs (peaks) or the significant lows (troughs) of an appropriate zigzag using technical tools of the computer program.
To draw a trendline only two points are necessary and the third one is the contact point confirmation. On a bullish trend chart it should be drawn using troughs, on a bearish using peaks. The trendline and a line which is about parallel to it and drawn on the opposite side (through peaks on a bullish trend and through troughs on a bearish) form the trade channel. Both lines are then channel's borders.
Lines of support and resistance. The upper and the bottom borders of trade channels are called accordingly support and resistance lines. The peaks represent the price levels at which the selling pressure exceeds the buying pressure. They are known as resistance levels. The troughs, on the other hand, represent the levels at which the selling pressure succumbs to the buying pressure. They are called support levels. In an uptrend, the consecutive support and resistance levels must exceed each other respectively. The reverse is true in a downtrend. Although minor exceptions are acceptable, these failures should be considered as warning signals for trend changing.
The significance of trends is a function of time and volume. The longer the prices bounce off the support and resistance levels, the more significant the trend becomes. Trading volume is also very important, especially at the critical support and resistance levels. When the currency bounces off these levels under heavy volume, the significance of the trend increases.
The importance of support and resistance levels goes beyond their original functions. If these levels are convincingly penetrated, they tend to turn into just the opposite. A firm support level, once it is penetrated on heavy volume, will likely turn into a strong resistance level. Conversely, a strong resistance turns into a firm support after being penetrated. In general, to evaluate the reliability (that is the possibility of a break) of the trade channel borders taking a decision to close or to save an existing position one should govern himself with following rules:
1. A channel is the more reliable the longer it exists. Hence, the solidity of very old channels (e.g. existing more than 1 year) decreased sharply.
2. A channel is the more reliable the more is his width.
3. The resistance may be broken if it is bounced on the background of a growing volume.
4. A steep channel is less reliable in compare to a gentle one.
5. The support may be broken independent on the volume.
----- SBJ --- by; T.Anderson -----
To draw a trendline only two points are necessary and the third one is the contact point confirmation. On a bullish trend chart it should be drawn using troughs, on a bearish using peaks. The trendline and a line which is about parallel to it and drawn on the opposite side (through peaks on a bullish trend and through troughs on a bearish) form the trade channel. Both lines are then channel's borders.
Lines of support and resistance. The upper and the bottom borders of trade channels are called accordingly support and resistance lines. The peaks represent the price levels at which the selling pressure exceeds the buying pressure. They are known as resistance levels. The troughs, on the other hand, represent the levels at which the selling pressure succumbs to the buying pressure. They are called support levels. In an uptrend, the consecutive support and resistance levels must exceed each other respectively. The reverse is true in a downtrend. Although minor exceptions are acceptable, these failures should be considered as warning signals for trend changing.
The significance of trends is a function of time and volume. The longer the prices bounce off the support and resistance levels, the more significant the trend becomes. Trading volume is also very important, especially at the critical support and resistance levels. When the currency bounces off these levels under heavy volume, the significance of the trend increases.
The importance of support and resistance levels goes beyond their original functions. If these levels are convincingly penetrated, they tend to turn into just the opposite. A firm support level, once it is penetrated on heavy volume, will likely turn into a strong resistance level. Conversely, a strong resistance turns into a firm support after being penetrated. In general, to evaluate the reliability (that is the possibility of a break) of the trade channel borders taking a decision to close or to save an existing position one should govern himself with following rules:
1. A channel is the more reliable the longer it exists. Hence, the solidity of very old channels (e.g. existing more than 1 year) decreased sharply.
2. A channel is the more reliable the more is his width.
3. The resistance may be broken if it is bounced on the background of a growing volume.
4. A steep channel is less reliable in compare to a gentle one.
5. The support may be broken independent on the volume.
----- SBJ --- by; T.Anderson -----
Monday, June 15, 2009
Forex CCI Divergence Breakout
Timeframe : 15mins and above
Indicator : CCI (Commodity Channel Index
Description : This strategy uses hidden divergence and price action to take a breakout trade. Divergence is the one
key indication in the market that can be useful and is not lagging. It is a sign of a market reversal coming up in the near future. Understanding and making use of divergence will help a technical trader greatly when analyzing the market.
Note : On my CCI, I always connect my peaks (tops) never the bottoms (dips).
Long Breakout
- Price must be trending downwards
- CCI must go towards the upward direction and bounce
- After a bounce on the CCI, connect your high peaks on your price
- Aggressive : At a clear close above the trend line enter long
- Conservative : After the trend line is broken, wait for a pullback to the trend line to enter
Short Breakout
- Price must be trending upwards
- CCI must go towards the downward direction and bounce
- After a bounce on the CCI, connect your dips on your price
- Aggressive : At a clear close below the trend line enter short
- Conservative : After the trend line is broken, wait for a pullback to the trend line to enter
Stops
- If your trend line is not that steep, you can keep your stops at the high/low of the breakout candle.
- If your trend line is steep, keep your stop at the swing high/low
- If your trend line is medium steep, keep your stop at the low of couple candles away
Exits
- 1:1 Risk to reward. If your stop is -12 pips your limit should be +12 pips.
- Open 2 lots. If your stop is at -10 pips, once your trades goes in your favor and you're at +10 pips, close 1 lot and let the other one run. Exit at Support and Resistance levels.
the other one run. Exit at Support and Resistance levels.
- Exit at the nearest 50 or 00 level. These are psychological levels. (make sure your exit is at least the same number
of pips as your stop, otherwise dont enter the trade)
- Trailing Stop. Once in a trade, at the close of each candle, place your stop 1 pip below the low (if in a buy trade). Vise versa for sell trade.
Short Example
Long Example
Spread Trading Strategy
A properly placed stop loss can benefit your spread trading strategy. Make money whichever way the market is moving, rising or falling. Spread trading is tax free, opening a trade is easy, and you can close out positions quickly. Try it!
------- SBJ ------ by; Navin prithvani ------
Indicator : CCI (Commodity Channel Index
Description : This strategy uses hidden divergence and price action to take a breakout trade. Divergence is the one
key indication in the market that can be useful and is not lagging. It is a sign of a market reversal coming up in the near future. Understanding and making use of divergence will help a technical trader greatly when analyzing the market.
Note : On my CCI, I always connect my peaks (tops) never the bottoms (dips).
Long Breakout
- Price must be trending downwards
- CCI must go towards the upward direction and bounce
- After a bounce on the CCI, connect your high peaks on your price
- Aggressive : At a clear close above the trend line enter long
- Conservative : After the trend line is broken, wait for a pullback to the trend line to enter
Short Breakout
- Price must be trending upwards
- CCI must go towards the downward direction and bounce
- After a bounce on the CCI, connect your dips on your price
- Aggressive : At a clear close below the trend line enter short
- Conservative : After the trend line is broken, wait for a pullback to the trend line to enter
Stops
- If your trend line is not that steep, you can keep your stops at the high/low of the breakout candle.
- If your trend line is steep, keep your stop at the swing high/low
- If your trend line is medium steep, keep your stop at the low of couple candles away
Exits
- 1:1 Risk to reward. If your stop is -12 pips your limit should be +12 pips.
- Open 2 lots. If your stop is at -10 pips, once your trades goes in your favor and you're at +10 pips, close 1 lot and let the other one run. Exit at Support and Resistance levels.
the other one run. Exit at Support and Resistance levels.
- Exit at the nearest 50 or 00 level. These are psychological levels. (make sure your exit is at least the same number
of pips as your stop, otherwise dont enter the trade)
- Trailing Stop. Once in a trade, at the close of each candle, place your stop 1 pip below the low (if in a buy trade). Vise versa for sell trade.
Short Example
Long Example
Spread Trading Strategy
A properly placed stop loss can benefit your spread trading strategy. Make money whichever way the market is moving, rising or falling. Spread trading is tax free, opening a trade is easy, and you can close out positions quickly. Try it!
------- SBJ ------ by; Navin prithvani ------
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