FREE FOREX STRATEGIES

Developing a Strategy #1 (Daily chart trading)


Submitted by dachelm
[email protected]

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Hello and thanks for this great site.

This strategy is still in development and I still don't know if I should send this but I find it quite interesting and I just want to share it. Please let me know if I am right or if this could be something else.

OK here's the deal. The start point is the daily chart and is quite easy to understand cause does not require any indicators so far but could be considered if somebody want to add something to this "strategy".


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What if we do next:

Add this indicator sa#MTEI_Supertrend.mq4, which will suggest a trend.
a) when the line is green - only Long, red - only Short.
b) set entry order 10 pips below previous candle's low (downtrend) / high (for uptrend) and only if previous candle's color is the one we need,
e.g. if we are going to Short only (indicator line is red), we look for a previous candle to be bearish (red) on the close, if so, then we set a Sell Stop order 10 pips below that candle. Close by the end of the day with either profit or loss, as suggested by dachelm (the author), and no stop needed.
b) do not trade Mondays (lots of negative trades has been observed on Mondays).

Forex strategy developing

Also tested same rules but without looking back at the color of the previous candle, e.g. always kept either Short or Long order 10 pips away in the direction suggested by Supertrend indicator. Got 21 winners and 5 losers for the same time period.

Regards,
Edward

So as I see it, we need to either find a method to filter sideways patterns (where candles change directions frequently) or we may try to identify a trend with a help of some indicators and take trades only in one direction.
I'll come back with ideas in few days.
Olvier

You are right the risk is high, that's why I wanna keep looking for a lower risk method. That's the reason of posting my idea here. This really works but sometimes the risk gets very high.
Thanks for your comment.

sounds good. maybe worth looking at how often price actually becomes range bound in daily chart. if there is only ever 4-5 candles max that go , up, down, up, down, then i think u have a very good strategy and using the doubling method wouldnt be risky.
however if you find times when prices does go up first candle, then down second, and up 3rd, 4th,5th etc .... think whether that would blow ur account.


 

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