This forex strategy is suitable for those traders looking to get a simple edge on the market, while not overcomplicating the rules. It is straightforward. strategy identifies trend, while confirming its momentum. Trade is triggered by the price moving above its average high/low (envelopes calculated).
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Those two simple strategic advantages are well complimented by break even conditions applied on ever profitable trade. Therefore, profits are protected. Situations when good trade goes bad are almost completely avoided. The game forex strategy can be effectively used also for scalping.
Strategy was tested on historical data of EURUSD since 2003 with profitable results and the expert trading it together with full strategy rules, are provided freely by theforekings.
Used forex tools and indicators
Average directional movement index (ADX 40). Main ADX line must trend above 10 value. This signalize sufficient momentum to even consider an existing movement to be a trend of some sort. Then we look at position of DI- and DI+ line. To enter the short trade DI- line must trend above DI + line. Reversed position signalize uptrend and triggers long trade only.
Envelopes (period 20 deviation 0,4) : Price moving above upper envelopes line signalizes buy trade. Price moving below bottom envelopes line signalizes sell trade. To pull the position trigger, price must return within tunnel boundaries.
Break even condition: After the position reaches certain profit. Stop loss is adjusted and placed on trade open price to avoid any loss in case of position reversal.
Forex strategy rules
SELL
ADX main line above 10 value. Trend momentum confirmed.
DI – line above DI+ line. Uptrend confirmed.
Signal: We will be looking for price (candle low) to move below the envelopes bottom line. Once it closes back within the tunnel, we enter the trade short.
Take profit: 10 pips
Stop loss: 30 pips
Break even: 5 pips
BUY
ADX main line above 10 value. Trend momentum confirmed.
DI + line above DI- line. Downtrend confirmed.
Signal: We will be looking for price (candle high) to rise above the envelopes upper line. Once it closes back within the tunnel, we enter the trade long.
Take profit: 10 pips
Stop loss: 30 pips
Break even: 5 pips
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Disclaimer: Expert advisor was tested for profitability on historical data. All screen shots provided are displaying real results of the test. However past data will never guarantee future success. Every expert advisor needs to be tested properly on demo account. LIVE use only on your own risk. Read full disclaimer. TheForexKings Team does not give any financial advice. TheForexKings does not take any responsibility for any user’s investments and investment decisions. All rights reserved. Strictly for personal use.
