by TFK1: I have always enjoyed the concept of adding to winner. For those of you who are not familiar with it. Adding to the winner/pyramiding allows opening more positions in the direction of profitable trade. Typically, two conditions must be met. Stop loss of all opened positions is adjusted according to last signal. Profits of opened positions must be protected before you enter another trade.
By following those simple rules you can open a large number of risk free trades once your initial position moves to profit. Once you master this simple concept it can literally grow your account overnight without extreme risk that would be required to do so, with most conservative forex strategies.
For the best results, trade with professional ECN/STP broker with MT4. If you can't trade with profit. Automatically copy the traders that are already profitable.
Used indicators
DeMarker (7 blue and 80 red). Apply both of them in the same indicator window to avoid the clutter (drag and drop the second one from navigator window in MT4). Apply central line with value of 0,5.
Fractals: If you want to simplify and visualize the real wave structure of the market, fractals are the go to tool. Fractals will help us to set up an ideal position for stop loss placement.
Forex strategy rules
To get the most out every trade, trade in 1H chart.
Sell:
DeM 80 trends below 0,5 line. Downward momentum is present in the market and we will enter short trades only.
DeM 3 rising above 0,7 line.
We wait for formation (closure) of bearish fractal at the top. That requires two candles to be closed on the right sie of a fractal. Once the second candle closes, together with our signal fractal we enter the trade short.
Placing stop loss of all opened positions at the base of signal fractal.
Stop loss of new position, must be below the price of any currently opened short entry.
Take profit: there is no profit target, positions will be liquidated at the stop loss of most recent trade.
Buy:
DeM 80 trends above 0,5 line. Upward momentum is present in the market and we will enter long trades only.
DeM 3 falling below 0,3 line.
We wait for formation (closure) of bullish fractal at the bottom. That requires two candles to be closed on the right side of a fractal. Once the second candle closes, together with our signal fractal, we enter the trade long.
Placing stop loss of all opened positions at the base of signal fractal.
Stop loss of new position, must be above the price of any currently opened long entry.
Take profit: there is no profit target, positions will be liquidated at the stop loss of most recent trade.
Final rule: Protect the profits of all existing positions. Once the position moves to profit. Adjust stop loss to break event even if there is no further signal. Under the volatile market conditions, recognize that there is no real chance of adding to the winner and liquidate position in profit of at least the same size as stop loss.
