This trading system works well both as scalping forex strategy in lower timeframes, or as a standard day trading strategy in 1, or 4 H chart. Aggressiveness of strategy can be scaled up or down according to prefferences of the trader. Build in trail stop can be used additional deviation and take profit can be utilized too.
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We have tested this forex strategy with great results only for small fraction of viable input range. Testes were run on high quality tick data since 2003 (1H EURUSD). As we mentioned before it works for ultra wide variety of settings.
Used tools and indicators
Ichimoku kinko hyo (520,260,90). Primary trend filter. Higher calculation period. Tenkan sen will lead our trailing stop and all positions must follow ichimoku identified trend.
Demarker (14) entry signal. We will wait for signal completion (indicator returning from overbought/ oversold zone) before entering the trade.
Advanced Trailing stop (extra deviation for trail stop 40 pips) TS is based on Tenkan sen line of the ichimoku (red). Extra deviation can be applied to cover additional market volatility.
Max open trades(5) Strategy allows opening more than one trade per direction at the same time. This increases the risk and it is necessary to adjust the leverage.
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Forex strategy rules
The upper cloud edge, consisting of span B and span A line is above the price.
Span B is above the span A.
Kijun sen (blue line) trends above tenkan sen (red line).
This position of the indicator relative to the price confirms the downtrend.
We will be looking for Demarker crossing above 0,7 line. Once it closes back below it, we enter the trade short.
TS is placed according to tenkan se (red) but it is placed above it according to extra deviation for trail stop applied.
Take profit: not used in test
The bottom cloud edge, consisting of span B and span A line is below the price.
Span B is below the span A.
Kijun sen (blue line) trends below tenkan sen (red line).
This position of the indicator relative to the price confirms the uptrend.
We will be looking for Demarker crossing below 0,3 line. Once it closes back above it, we enter the trade long.
TS is placed according to tenkan se (red) but it is placed below it according to extra deviation for trail stop applied.
Take profit: not used in test
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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.