FREE FOREX STRATEGIES

Forex trading strategy #6 (Double Stochastic)


By doubling on Stochastic analysis we are doubling on trading accuracy... However, one should remember that with each new Forex tool added complexity can appear; and a very complex approach is not always good.

Strategy Requirements:
Currency pairs: ANY
Time frame chart: 1 hour, 1 day
Indicators: Full Stochastic (21, 9, 9) and Full Stochastic (9, 3, 3).


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Hi Edward
Many thanks for your comment. I will start to watch gold . There seems to be quite a variety of gold indices to follow. Which would you suggest I follow?. spot goldusd, spot gold aud , or another. I am gaining a lot of information from your great comments and clear explanations and the comments of others. Keep it going.
Regards
Morrie

Hi Morrie,

AUDUSD has high correlation with Gold. When Gold goes up, AUDUSD tends to go up too.
The explanation for this is that Australia is among the largest producers of gold.

Regards,
Edward

Have been trading the AUDUSD and keep getting stopped out or caught by large swings. Do you know of any leading currency pairs for AUDUSD. Thanks Edward
Morrie

Also have a look here:
Correlation, hedging

no not yet!! Still looking into that?? Justed found the website again.

One of the User asked about "currency pairs that follows the same pattern",
my query to that User: Any useful information to share with all?

Thanks in Advance.

Regards,
Manikandan.

Hi Jackson,

It would definitely be better to look at 2 time frames: smaller and larger.
4 hour charts can be used of course, combine them with 30 min or hourly charts to give yourself a more accurate entry.

Regards,
Edward

Hi Edward,
Thank you for this great revelation. my question is that will stochastic 21,9,9, and 9,3,3 work well in 4hrs chart as that of 1hr chart / Day chart. And must I used both time frame to place my entry and exit.

Thanks
Jackson, Nigeria

I see,

I found some information about this, although I haven't used it much in my trading, except, however, the knowledge of GBPJPY pair and Gold.

In Forex it is believed that EUR/GBP and GBP/JPY have a value as the leading indicators of EUR/USD and USD/JPY moves accordingly. (EUR/CHF is similar to EUR/GBP in forecasting value).

EUR/GBP and GBP/CHF are leading indicators for EUR/USD and USD/CHF accordingly,
and GBP/JPY, EUR/JPY and CHF/JPY are leading indicators for USD/JPY.

Also GBP/JPY is a leading indicator for GBP/USD.

As a rule of thumb with "leading" and "lagging" pairs, if EUR/USD does not move but EUR/GBP moves first, it is an indicator that EUR/USD is sitting out but should wake up soon; when EUR/USD moves but EUR/GBP does not move first or in tandem, then it is highly likely that EUR/USD move is counter-traded and the opposite move is expected soon.

Also consider Gold, as Gold charts are the mirror of Dollar for hedging purposes.

If this search of similarity/leadership in pairs inspires you, I strongly believe you should look closer into it: there are some good points for evaluation.

Best regards,
Edward

Well, Hopefully I can explain this correctly. I've been doing some research trying to find some loopholes and/or easier ways to make money in the forex. So there have been some research trying to link some currency pairs with others. they used the CHF/JPY and EUR/USD in this case. From 2002 to 2008 it is said that they closely follow each other with a 0 to 2hour time difference. Which of course CHF/JPY leads and EUR/USD follows. Have you ever heard or know about this and/or any other that do this. Also do you know of any loophole or other ways to make money from the forex??

Thanks

There are no such pairs in Forex, if I understood you correctly. Feel free to explain in further details.

Regards,
Edward

Edward,

Do you know of any currency pairs that follows the same pattern as any other but, about a hour or more difference in time??

In MT4 Use Simple Stochastic.
You should be good with both Stochastics.

HI SIR. THANKS FOR THE GOOD WORK.PLS IS BOTH STOCHASTIC EXPONENIAL OR SIMPLE.I ALSO USE METATREADER4 WILL SETTING THE SECOND STOCHASTIC BRIND THE SAME RESULT?
PETER NIGERIA

Thanks a lot Edward for your quick response. I cannot watch the market every minute during the power hours in the early morning because I live in Los Angeles so those hours are 4am til about 9am in most cases and thats when I am actually working. So i'll be practicing the daily+hourly charts. Thanks again for tips.

Take care and Happy Trading,
Darin


 

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