With this forex strategy, we will be looking for clear bullish/bearish candle and nothing else. Once it meets our predetermined conditions, it is very likely that price will continue in its direction. Strong feature of this forex strategy is the fact that it is able to deal also with incorrect entry and still get end up in profit. Profit and loss is clearly established so it is easy to calculate risk before entering the trade.
Forex strategy rules
Timeframe above 30 min.
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Buy:
We are looking for clearly bullish candle. According to this system, it must meet following criteria:
Surpassing the high of at least 4 previous candle.
Signal candle body is wider, than whole range of any of at least 4 previous candles.
Flat upper wick of the candle.
This signalize clearly bullish move. Our expectation is, that it will continue for at least range of the signal candle.
We place initial pending buy order at high of signal candle. With take profit that equals range of candle and stop loss at low of the candle.
Once we enter the position, we place pending sell order, with double the size of initial order, at the low of the signal candle (stop loss for initial order is placed at same price level).
At point of entering the second trade (first is closed in loss) we once more place pending buy order at the high of the signal candle (using same profit and loss targets). This time however, 4x the size of initial order. We also place stop loss for second order at this price level.
Sell:
We are looking for clearly bearish candle. According to this system, it must meet following criteria:
Surpassing the low of at least 4 previous candle.
Signal candle body is wider, than whole range of any of at least 4 previous candles.
Flat bottom wick of the candle.
This signalize clearly bearish move. Our expectation is that it will continue, for at least range of the signal candle.
We place initial pending sell order at low of signal candle. With take profit that equals range of candle and stop loss at high of the candle.
Once we enter the position, we place pending buy order, with double the size of initial order, at the high of the signal candle (stop loss for initial order is placed at same price level).
At point of entering the second trade (first is closed in loss) we once more place pending sell order at the low of the signal candle (using same profit and loss targets). This time however, 4x the size of initial order. We also place stop loss for second order at this price level.
Notes to the forex strategy
With this strategy, you get 3 chances to enter the trade. Only after 3 unsuccessful trades, loss that equals 7x size of the candle range is booked. Do not attempt to continue to enter on that candle if all 3 attempts failed. Reset and regroup.
Avoid trading in range, or close to strong supports / resistance zones. Price must be trending for this strategy to work properly.
Winning trades are much, much more frequent. Infrequent losses are simply a cost for doing business.
