Forex trading strategy #6 ("Key Simplicity")
Submitted by Edward Revy on February 28, 2007 - 15:49.
Yes, one look - one hit. A trader can decide on his/her trading plans by a simple 1 second glance at the chart. It is a very simple Forex trading system that is a pleasure to use for traders with a busy schedule.
Strategy requirements:
Time frame: 1 day
Indicators: 5 EMA, 12 EMA, RSI 21
Currency: ANY
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I WOULD LIKE TO DO THIS SYSTEM ON A 1HR. CHART? IS THERE ANYTHING THAT CAN BE DONE ABOUT THE FALSE SIGNALS?
For hourly charts you would most likely need an additional indicator to help identifying the main trend.
For this purpose you may try using 20 EMA or 30 EMA or 55 EMA at your choice.
Additional trading rule will then be set:
When price is above 20/30/50 EMA - it is an uptrend, therefore take only Buy signals and ignore all Sell signals.
When price is below 20/30/50 EMA - it is a downtrend, take only sell signals.
Regards,
Edward
1. Which Pairs you most recomend for trade with this strategy ?
2. How we avoid Sideways movement ?
3. Can we add something filters e.q. SMA 150 By Closed ?
Need your answer. Thanks
We put stops outside the previous swing high/low.
The filter here is RSI above and below 50.
Regarding additional filters, there could be many: Stochastic, CCI, ADX, another SMA etc etc.
every trader has own favorite indicators he understands and trust most. I invite you to simply try out some other Forex strategies at our website and then combine the methods and filters you like most.
During sideways activity RSI is one of the best indicators to trade with: we look at oversold/overbought zones.
If you wish to avoid sideways markets, use ADX indicator, where readings below 20 suggest absence of a trend; or try out recently recommended indicator: Choppiness index, the rules to which as well as downloading link you can find in the comments.
Best regards,
Edward
Q: if I am late one-two days and EMA crossed already, but RSI is still below/above 50. Can I still trade or wait?
Thank you
BA
Limit your risk by trading a smaller lot and yes, you can trade.
Regards,
Edward
Hello Edward,
I'm Lanie, I enjoyed this site so much! Thanks for helping all of us especially beginners like me.
I just want to ask if we can use the same settings if we will trade using 4h chart?
thanks alot!
Lanie
Hi Lanie,
Thank you for your feedback!
Absolutely, we can use the same settings for 4h chart.
Regards,
Edward
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