FREE FOREX STRATEGIES

Forex trading strategy #23 (Trading with Average Daily Range)


Submitted by Ipun

1- Close out any open position
2- Cancel any unexecuted orders
3- Set an Entry Buy order 1 pip above previous high
4- Set an Entry Sell order 1 pip below previous low
5- Set stops and limits using the following guidelines:

50 pip profit target, 25 pip stoploss if ADR Above 200
40 pip profit target, 20 pip stoploss if ADR BETWEEN 175 and 199
30 pip profit target, 15 pip stoploss if ADR BELOW 175

Do not trade if ADR is below 100

How to calculate ADR (Average Daily Range)

It may be easiest to use an excel spread sheet for this.
Take the H/L for each day. for the past 14 days.
For each day list the amount of pip's between the H and L

Ex. H=1.5623 L=1.5586
5623-5586 = 137
Add the total amount of pip's for all 14 days and divide it by 14.
This will give you the average daily range.

Forex Average Pips: 250-300/month.

Email: i_ipun[at]yahoo.com

Edward Revy,
http://forex-strategies-revealed.com/

Copyright © Forex Strategies Revealed

dear ipun,
you told not to trade if adr<100. tell me which currency pair ,generally has adr >150. thank you.

Have any one other than author of this strategy tried with this strategy with successful result ?

Hi Ipun
Can you please clarify what you mean by setting entry at the previous high and low. What timeframe are you referring to?

I forgot to add this. Here is a screen shot of the EA in action. The settings at the bottom show some of the options that can be set in the EA. The Yellow line is the pending sell trigger line that was not hit. The gray box in the background is the current daily range. 14 and 50 EMAs. You can clearly see how one or two PiPs on the low side would have triggered a sell and the sell would have been a loss. Link to screen shot http://screencast.com/t/cM3HNLlvD I've tried narrow straddles and wide straddles, same results in back testing. Any Ideas?

I have developed an EA for this strategy that also includes partial closes, 3 exit options that are triggered at x PiPs past open, and incorporates a compounding money management system. I straddle the market when it is in consolidation (for example EUR/USD around 21:30 GMT). This strategy has a 50/50 win ratio at best. Here is the problem. The market goes one direction hits your pending buy or sell and then reverses to your stop loss. This could be a VERY profitable strategy/EA if someone can figure out how to reduce the false entries. It works great if the market takes off out of consolidation and trends one direction. It loses money in a sideways market. I will add and test any good ideas to solve this problem and share the EA with anyone who can solve the problem. I can be contacted at [email protected]

I have used this on my demo account for eurusd and gdpusd. made 30 pips each. cool!! going to try this out for one month before using real money. Anyone else started using this method? Do share your thoughts with me via [email protected]

just loss 15 pips

Hi Guys, i just came across this tonight. Sounds easy and very logical. Any updates or feedback on those that have used this so far?

safe simple system can;t make all your pips on this but a great system none the less. I do a similar system at the london open but I'm going to use this one too. Easy money is easy money

Here is ADR indicator to download: ADR_lines_Shinigami_v1.1.mq4

Hi!
Thanks a lot for this site! Can somebody tell me, if it is possible to get signals from the ATR when using the simple strategy for eur/usd, MACD 12,26,9 and Parabolic Sar? How would this be? I need to recognize strong trends. It would help me a lot. Thanks!

Sorry for my English, I am just s Swiss German and French...:-)
Muriel

Hello All!

Has anyone been trading this strategy consistently? If so, what experience/results have you had with it?

As Neal mentioned, this does seem pretty easy to automate, but I'm not a programmer. If anyone is able to successfully do so, it would be greatly appreciated. Also, I have enclosed an indicator that shows the ADR. Hope it helps! GL! :-)

I believe the second one is left open till the next re-set of orders.

Kind regards,
Edward

Thank you very much for this strategy, but one question I want to ask is how to deal with the second order if one of the order is trigered, or should we leave the second order untill the close of the Day? please help.

by fxtutor.

This would be a very easy strategy to automate. I assume the stop loss is set immediately after the trade is triggered. For daily time frames the stops seem very close, but on the other hand the take profits are too, given the ADR of the pair being traded. This strategy relies on momentum to get to the take profit before it reverses and hits the stop (which will of course happen at times). For volatile pairs it would be possible play with Risk/reward ratio and get it out too 1:3. Also, by trading multiple lots and taking them off at different points it may be possible to lower risk while letting one lot run for a bit.

Cheers

Neal


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