Forex trading strategy #1 (Simple balanced system)

Current Forex trading system represents a well thought and very simple combination of indicators. Knowing what signal to look for with each indicator, provides a strong tip for good entries and exits.

Time frame: Any.
Currency: Any.
Indicators: 5 EMA, 10 EMA, Stochastic (14, 3, 3), RSI (14, 70, 30)

EA: SimpleBalanced_1_0.mq4

Entry rules: Buy when 5 EMA crosses above 10 EMA and Stochastic lines are heading north (up) and Stochastic is not in overbought position (above 80.00 level) and RSI is above 50.

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1) correct, once RSI goes above 50 - enter Long.
2) RSI should go above 50 again, but since Stoch is in overbought we have to pause and wait till Stoch exits an overbought area - at that moment we'll be witnessing a correction in price as it'll retrace lower - then once Stoch lines again cross upward outside an overbought area (normally this cross will happen around 50 level of Stoch) + if EMA alignment is still valid + RSI is still above 50 - we enter Long.

Best regards,

We need both Stoch lines in oversold/overbought region, to consider it oversold/overbought, sorry for the repetition.


Hi Edward,

I would like to know, for example

1) EMA cross for a buy, but RSI is below 50 and Stoch is below 80, we wait for RSI to go above 50 and enter right?

2) EMA cross for a buy, but RSI is below 50 and Stoch is above 80, do we still wait for RSI to go above 50 and enter?

Edward, as you were saying that Stoch should not be in the oversold/overbought region. Do you refer to both K% and D% entering the region together, or if one of them enter the region and still consider a valid setup?

Hi Raymond,

there will be no re-entry rules here.
I'm not against fundamental studies, but I don't see a real practical application of it (direction, filters, signals) for this particular strategy.

Best regards,

Hi Edward,

Thanks for the hard work. Can I know if there is any re-entry rules? And also how have you use this together with fundamentals trading?



trading GBPUSD on hourly charts from 7 to 11pm EST is, to be fair, very unpromising.

If you cannot trade during London and New York sessions, it is better to start looking at daily strategies.

In order to profit from currency fluctuations we need the market to move, and not just idle back and forth, but create a trend; during the Asian session conditions for this are not favorable.

Best regards,

i will try ur strategy as u tell me wish me luck

Ed, Let me first complement you on your unselfish act in teaching new traders. I checked out most of your strategies. I am still deciding as to the best possible approach. I am interested in trading GBP/USD. I prefer 1 hr timeframe. I can only trade during Asian session (7PM to 11PM EST). I am anxious to hear your recommendation. Thank you. KPK

i really appreciate ur system.

With MACD it would be an overload.
I'd also love to have an EA or alerts for it. anyone?


i am new to FOREX trading, however backtesting shows good results. Is there someway to create an alert as this may help not being glued to screen for hours..Any suggestion from experienced traders.

Thanks in advance.

Any additional pointers? How we should use the above mentioned MACDs?
Thank you for sharing.


Not sure if anyone said something yet, but wouldn't it just be easier to use a 5/10 macd? since it is based on ema divergence.

Hi Edward,
You are doing a great job in sharing your forex expertise. Many thanks for that.
This simple strategy look promising and I will try this and will feedback.
Philip, Malaysia


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