Day candle bandit forex strategy

This trading system is based on one older forex strategy we have received some questions about. We decided to put it to test and if possibly improve it (which is always nice. New strategy offers some interesting features and produced solid results during our standard 13 year test.

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The system places pending buy stop/sell stop orders at the daily candle high/low. Order is triggered during the next day and we will be looking for the profit target that equals stop loss. To establish those values whole candle range is used.

 

Previous strategy didn't take any trade into account and did not consider candle close vs max/min when placing the pending order. Some candles are clearly signaling that momentum is lacking and trend is likely to reverse. By simply comparing candle close to the high/low you would be able to filter out some of them, lowering draw down and improving profit factor.

 

Forex strategy is conservative and relatively secure. Yet the profits are showing huge potential. Expert advisor created for this forex strategy was tested on historical data since 2003 /EURUSD daily candle).

 

Used tools and indicators

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.

 

Exponential moving averages (EMA 20,60). Standard EMA positioning is used to determine general trend direction in daily chart. All trades must be in confluence with this trend.

 

Candle signal (minimum 60, maximum 250 body range). We will be looking for big enough bearish/bullish candle. We will expect the momentum to continue during the next day, trigger our order and continue to reach our profit target. Pending orders are placed at closed candle high/low, expecting the continuation.

 

MAX wick size (30) Wick in the direction of candle and expected continuation cannot surpass maximum allowed with. Wider wick signalizes questionable momentum and such candle is considered to be unreliable for entry.

 

Take profit and stop loss: We measure candle range (high- low). The distance is used both for profit target and stop loss.

 

Break even: After position reached predefined profit, stop loss is adjusted on break even price (entry price).

 

Remain valid (1): untriggered pending order will remain valid for 1 day.

 

Forex strategy rules

 

SELL

Downtrend according to EMA pair. Faster EMA trending below the slower.

We will be looking for strong bearish candle with defined min/max body range and with bottom wick not larger than max wick size.

 

Once such a candle closes, we place pending sell stop order at candle low. Distance between low and high is used both for profit target and stop loss.

 

Break even: After position reaches predefined profit we adjust stop loss to break even.

Untriggered pending order may remain valid for 1 day.

 

BUY

Uptrend according to EMA pair. Faster EMA trending above the slower.

We will be looking for strong bullish candle with defined min/max body range and with bottom wick not larger than max wick size.

 

Once such a candle closes, we place pending buy stop order at candle high. Distance between low and high is used both for profit target and stop loss.

 

Break even: After position reaches predefined profit we adjust stop loss to break even.

Untriggered pending order may remain valid for 1 day.

 

Get MT4 expert advisor trading this forex strategy

  

For best results, use this forex strategy with one of our trusted forex brokers

(STP/ECN with MT4 bridge).

To win you must trade with broker on your side.

 

 

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.

 

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THEFOREXKINGS

“Trading FOREX since 2006. Full time trader and web developer since 2013. My two biggest hobbies are trading and web development. In TheForexKings I managed to connect both of them. Even after 12 years of trading I still have the same passion for the market as at the beginning. The aspect I enjoy the most : development and testing of new ideas.” 

 

Only in 2016 - 2017 we have created more than 400 forex strategies. During this period we have also developed and published +200 MT4 Expert advisors based on those strategies. We are dedicated to provide you with viable and complete trading systems that have thrived in extensive historical testing. We want to give you complete and transparent trading solutions, that once mastered ,will set you financially free. We want to give you a fighting and winning chance in the market. ” 

—  Marian, Proprietor of TheForexkings.com