This forex scalping strategy uses just a price itself, as an entry signal for position. It is roughly based in old trading method used by pit traders on Wall Street. Entry is based on observing low of the candle for entry short in downtrend and high of candle for entry long in the uptrend.
Tick test on 1H EURUSD data: 2013 -2016
Accurate entry is entirely dependent on correct trend identification. This forex strategy uses alligator indicator as all in one solution to find the trend and yet still be able to recognize trend reversal soon enough.
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Used forex indicators
Alligator forex indicator (130,80,50) Slow calculation period is used, as we want to focus mainly on main trend driving the markets in higher timeframes.
Forex strategy rules
Alligator lines aligned according to downtrend from slowest to fastest at the bottom (blue, red, green) jaw, teeth and lips. Lines must be clearly separated and untangled.
Four consecutive candles with each low is higher than previous candle low. At fourth candle we place pending sell order (sell stop) at its low.
Alligator lines aligned according to uptrend from the fastest to the slowest at the bottom (green, red, blue). Lines must be clearly separated and untangled.
Four consecutive candles with each high lower than previous candle high. At fourth candle we place pending buy order (buy stop) at its high.
Notes: Take profit may seem to be a little small compared to stop loss but according to various testes this is one of the best setting for this combination of signal. Wins are about 9 times more likely than losses. According to tests win rate is about 90 percent.
We recommend you to use this forex strategy with one of our trusted forex brokers (STP/ECN with MT4 bridge).
To win you must trade with broker on your side.
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