This amazing forex strategy uses two filters to avoid entering the trade in any other than trending conditions. Alligator forex indicator with slow calculation period is used to find main trend. Once we identify the driving force and its direction in the market, CCI 60 helps us to find market momentum.
We will be looking for strong price momentum to the direction of main trend. CCI 60 does an excellent job when it comes to avoiding an entry at the end of the trend.
In this forex strategy, position entry is triggered by price movement in the direction of the trend. Once there is no movement, strategy cannot give us entry signal. Using this approach, we leave alligator indicator time to catch up on trend reversal.
Finally, candle signal is used to distinguish small nuances in price development and help us find a suitable price for entry even in the rapidly moving market.
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Forex indicator used in the strategy:
CCI (commodity channel index) period 60. Purpose: Finding price momentum in the direction of a trend. Avoiding entry at the end of a trend. Finding rapidly moving swing, the best suitable for entry.
Alligator forex indicator (130,80,50). Purpose: Finding a main trend in our chosen currency pair.
Plot all of the indicators in 5 min char of any major currency pair.
Forex strategy rules:
Alligator lines are lined according to downtrend, from top to bottom:blue, red, green. Lines are clearly separated and are not tangled.
CCI 60 fall under – 100 line. We will enter the trade on bearish candle that caused CCI to fall below -100 line.
Stop loss is placed above the high of the candle. Once the position reaches the same distance as between entry and stop loss, we move stop loss to break even and continue to wait for target profit signal.
Target profit signal:
CCI rises above -100 line. We exit the short trade at profit.
Alligator lines are lined according to uptrend, from top to bottom:green, red, blue. Lines are clearly separated and are not tangled.
CCI 60 rises above 100 line. We will enter the trade on bullish candle that caused CCI to rise above 100 line.
Stop loss is placed below the low of the candle. Once the position reaches the same distance as between entry and stop loss, we move stop loss to break even and continue to wait for target profit signal.
Target profit signal:
CCI falls below 100 line. We exit the long trade at profit.