ADX and DeMarker scalping FOREX strategy

by tonpop: I use this combination of indicators to find an entry in 5 min charts of EURUSD (it can be applied on other majors). Premise of this scalping forex strategy is pretty simple. ADX help me to identify current market direction. Once I have found it, I enter the trade based on DeMarker signal. I used this setup for about four months almost every day and it works very well for me. The key here is to be able to exit the position immediately after you notice price reversal.

 

Used forex indicators

 

Forex strategy rules

 

SELL:

Main DeM line trending above 10 signalizing sufficient momentum to confirm trend. ADX+(green) trending below ADX- (red). This will signalize downtrend and we will enter short trades only.

Signal: DeM rising above 0,7 line. We enter on bearish candle closing below previous candle low. Stop loss is placed above the high of signal formation.

  • Position liquidation: ADX+ crossing ADX- upwards (trend reversal).

 

BUY:

 

Main DeM line trending above 10 signalizing sufficient momentum to confirm trend. ADX+(green) trending above ADX- (red). This will signalize uptrend and we will enter long trades only.

Signal: DeM falling below 0,3 line. We enter on bullish candle closing above previous candle high. Stop loss is placed below the low of signal formation.

  • Position liquidation: ADX+ crossing ADX- downwards (trend reversal).

Notes: I enter more than one position in the same trend. However, it is necessary to protect profits all of currently opened positions by adjusting stop loss.

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