by Soptal: Let me introduce you one of my favorite forex strategies. It may seem that it is based on CCI indicator, but actually the simple and easily identifiable candle signal is its base. The signal is based in simple comparison of activity during the previous 10 sessions (10 candles). Fundamentally speaking we will be looking for strong/significant movement that will confirm the trend.
As we trade with the trend lot of traders would go for the jackpot and try to ride it immediately, with this forex strategy you don't need to do that. It has pretty good win rate so you will do just fine going for profits as suggested.
Used forex indicators
I use only CCI. The CCI (commodity channel index), helps to filter out any trade that might go against the major trend.
Forex strategy rules:
SELL:
CCI line closing below zero. Downtrend is present in the chart.
We look for candle with body bigger, than bodies of previous ten candles. Ideally wicks of the signal candle will be relatively narrow. Completely avoid entering the trade on candle with wick taller than its body. Also, wick in the direction of trend cannot be taller than a candle wick opposing the trend.
Once signal candle closes, place pending sell order at its low.
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Take profit: I would commonly go for distance that equals the signal candle range. However, in some cases – when price reaches the target profit rapidly, increase profit target and move stop loss to break even.
Stop loss is placed at the high of a signal candle.
BUY:
CCI line closing above zero. Uptrend is present in the chart.
We look for candle with body bigger, than bodies of previous ten candles. Ideally wicks of the signal candle will be relatively narrow. Completely avoid entering the trade on candle with wick taller than its body. Also, wick in the direction of trend cannot be taller than a candle wick opposing the trend.
Once signal candle closes, place pending buy order at its high.
Take profit: Distance that equals the signal candle range. When price reaches the target profit rapidly, increase profit target and move stop loss to break even.
Stop loss is placed at the low of a signal candle.
Notes: Pending order remains valid for the next 10 candles.
