This simple forex strategy uses Zigzag forex indicator to establish swings. In volatile forex market it is only matter of time, until one of the extremes of the swing is broken (Low or high). Statistically, strategy works extremely well in all GBP pairs and especially GBPJPY.
Rules of the forex strategy
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We draw Zig zag forex indicator on our chosen 1H chart with default settings (12,5,3). Indicator starts to mark swings as red lines.
Once the swing finishes (Line is drawn and closed, new line is beeing drawn) we proceed to place pending orders at top and at the bottom of closed line (zigzag swing). Zig zag line is closed once new zig zag line begins to be drawn.
Orders are placed at the direction of the forex breakout. Pending sell order at the bottom. Pending buy order at the top of the swing.
We place stop losses for each order at the opposing end of the swing line (zig zag line). We use half of that distance to pre set our profit target for each order.
Once the order gets triggered, we cancel pending order at opposing end of the swing.
We let the opened position develop on its own and meanwhile we can place another order according to our rules.