Profitable forex strategy. According to high quality historical data test (+13 years), the strategy produces consistent results, with acceptable drawdown. All this without using any aggressive money management method, to achieve the results provided in the screenshots. Strategy used combination of SAR (parabolic), momentum adjusted RSI and specific candle size.
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It is also clear, that trailing stop plays huge rule in the results. Providing the protection and maximizing the profit capacity of every single trade. Strategy rules are provided fully together with free expert advisor trading them, by theforexkings.com. You are welcomed to test it for various scenarios (currency, time frame).
Used forex tools and indicators
Following settings have been used to achieve the results published on this page (1H EURUSD since 2003).
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Parabolic SAR (step 0,03, sar max 0,01). This forex strategy uses SAR as primary trend filter. Price must close below it to consider short entry and vice versa for long entry. SAR is very sensitive to settings, therefore make sure you adjust them properly before switching to other pairs or time frames.
Relative strength index (RSI 14). This powerful oscillator is used as a momentum indication. RSI entering overbought/oversold zone will be our primary entry signal. Entry signal is confirmed by closed candle. Strategy was tested only for RSI 14. It is very likely that other indicators period can bring much better results.
Candle signal (min 30 pips, max 50 pips). Strong bullish / bearish candle with minimum and maximum size defined. Each position is entered upon its close.
Trailing stop. Even though the SAR is commonly used for trailing stop purposes, this forex strategy works better with trailing stop being adjusted upon each candle close -+ extra distance of 20 pips.
Forex strategy rules
SELL
Price closing below SAR dot. RSI falling below 30 line. Downtrend and downward momentum are therefore confirmed.
We enter the trade short on bearish candle close.
Trailing stop is placed above the high of our signal candle+ extra distance of 20 pips.
Trailing stop is adjusted on each consecutive candle high only in the downward direction. Under no circumstances it should be moved up.
BUY
Price closing above SAR dot. RSI rising above 70 line. Uptrend and upward momentum are therefore confirmed.
We enter the trade long on bullish candle close.
Trailing stop is placed below the low of our signal candle - extra distance of 20 pips.
Trailing stop is adjusted on each consecutive candle low only in the upward direction. Under no circumstances it should be moved up.
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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.
