Forex trading strategy #6 (Double Stochastic)

Submitted by Edward Revy on February 28, 2007 - 14:36.

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).

Entry rules: When the Stochastic (21, 9, 9) lines’ crossover appears – enter (or wait for the current price bar to close and then enter). It will be the major trend.
Look at Stochastic (9, 3, 3) to anticipate swings inside the main trend and re-enter+ the market again – additional entries. Also ignore the short-term moves Stochastic (9, 3, 3) that signal for exit – do not exit early until Stochastic (21, 9, 9) gives a clear signal to do so.
Exit rules: at the next cross of major Stochastic (21, 9, 9) lines.

Advantages: using two Stochastic indicators helps to see the major trend and the swings inside it. This gives more accurate entry ruless and gives a good exit rules.
Disadvantages: needs constant monitoring, and again we are dealing with a lagging indicator.

Edward Revy,
http://forex-strategies-revealed.com/
Copyright © Forex Strategies Revealed

Submitted by User on November 27, 2020 - 09:11.

What a great strategy,is it advisable to trade against the trend.Thanks Edward.

Submitted by Bamidele on February 23, 2020 - 22:16.

Hello,why did Edward mentioned 1 hr and daily tf in his recommendation,it seems good in 4 hrs also,I need more explanation on this please. Thanks Bamidele

Submitted by Edward Revy on January 18, 2019 - 16:34.

Back-testing with Stohastic is problematic, as this indicator will repaint. Same would be with forward trading tests. Stochastic indicator strategies are among pillars in trading, but need to be combined with other methods to yield best results. In ranging markets you'll find it difficult to rely on Stochastic signals alone.

Submitted by User on January 15, 2019 - 18:11.

Hi Edward can I ask is this actually profitable. I started back-testing it and it looked like the lag of the Stoch makes it hard to profit with this? Do you any other recommendations to make a consistent profit. Maybe this is and I need to back test further? At the moment I am testing triangles. Do you have thoughts on those?

Submitted by Edward Revy on January 8, 2019 - 18:52.

While 21,9,9 is down, take only sell signals, means ignore all 9,3,3 ups and enter only when it crosses down.

Submitted by Edward Revy on January 7, 2019 - 19:08.

What do you recommend if the 9,3,3 is up and the 21,9,9 is down, or vicerversa? It is a great strategy tho

Submitted by User on November 5, 2012 - 10:28.

Edward, your stochastic parameters are not consistent when market changes direction. Which signal would you recommend to marry with stochastic to detect market direction instant.

Thanks

Submitted by User on September 21, 2012 - 03:37.

Thanks a lot Edward, my sheet is 100% green because of you

Submitted by prasanna on August 18, 2012 - 17:03.

combine the above strategy with bollinger band breakouts & RSI for a better result.
prasanna
Mumbai,India

Submitted by User on May 9, 2012 - 09:22.

This strategy working ok but how to ignore Stochastic (21,9,9) fake crossover? Most of the time Stochastic cross 20 then Stochastic (9,3,3) give me BUY signal but Stochastic (21,9,9) stay between 20 and 50 and price go down continuously.

Submitted by ilan on November 24, 2011 - 06:17.

first of all I want to say this site is great.I learned alot and keeping doit.
i look foward to understand well the market and keeping money.
best to all

ilan from israel.

Submitted by User on November 22, 2011 - 13:46.

I've been using this strategy for a few months now, and all I have to say is the strategy is simple and amazing. However, it definitely isn't a strategy where you can "set-it-and-forget-it." It requires constant monitoring. My goal is earning 3% each day/night using this strategy. I have been earning more than this each day. However, I don't really get much sleep during the week because I trade during overnight using this strategy and while I am at my full-time job. If you are dedicated and serious enough and wanting to succeed, I recommend this strategy. I figure I will catch up on sleep over the weekend.

Another great indicator to use along with this is Bollinger Bands. I pay more attention to the Stoch(9,3,3). However, when this indicator goes above 80 or below 20 and remains inside these ranges, that is when I turn to the Stoch(21,9,9). Stoch(21,9,9) gives a clear indication on what is happening in these ranges.

Good luck to all and don't be greedy. Follow your own strategy without deviating and you will win.

Submitted by Mike on September 3, 2011 - 09:22.

hello thanks 4 ds site
pls i trade with marketiva,they re not a metatrader platform...how do i configure the stoch.to 21 9 9 and 9 3 3 thanks a lot. Mike.nigeria

Submitted by User on August 28, 2011 - 01:57.

pls i need more explanation on double stochastic,if possible videos, can i use 34, 5, 5 and 5, 3, 3. Thanks in advance

Submitted by Antony on December 2, 2010 - 22:19.

Hi Wolf,

In my opinion:

1. Right.
2. Hourly is ok too.
3. You can add any MAs you like, for example 10 and 20 EMA.

Antony

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Forex trading strategy #6 (Double Stochastic)

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