Forex trading strategy #4 (RSI High-Low)

Hi Edward,
It's very informative and interactive page. Very good for newbies.

Cari, MY

ohh i love this site. Thanks Edward!!!

To me, RSI can't suggest exits well.
Among simple solutions there is Parabolic Sar indicator. Exit when it changes dot color.
Another way known to me is Heikin Ashi candlesticks.
Exit when Heikin Ashi candles change color. Also you may use trailing stop = place it above the last Heikin Ashi candle when Short and below when Long.
Cheers,
Sam

There are no exit rules posted for the "RSI High-Low" strategy. Has anyone played with different exit rules based on this strategy? Seems like the RSI is able to indicate entry points well, but I'm struggling with when to exit.

Thank you all,

William Hanson

Hi Victor,

for ranging markets you may try:
Tunnel method
and also Bollinger bands trading - bollinger bands are very effective in ranging markets, you simply trade every bounce of the bands.

Actually there is one very effective and simple Forex system based on Bollinger bands. It goes as follows:

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Indicators: Bollinger bands (20, 2) applied to close.

Once ranging market is identified, traders work with candlesticks that touch upper and lower bands of the Bollinger band indicator:

If a red candle touches the upper Bollinger band, go Short with a new candle open.
If a green candle touches the lower Bollinger band, go Long with a new candle open.

If a green candle touches the upper Bollinger band, wait. If next candle closes in red, then go Short with a new candle open.
If a red candle touches the lower Bollinger band, wait. Only if next candle closes in green, go Long with the next new candle open.

Stops are couple of pips away from the last candle to touch BB.
If a signaling candle also touches middle Bollinger band on the close, refrain from entries as a correction has high chances to occur.

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Another Strategy - based on MACD consolidation may be of some interest.

Happy trading!
Edward

Hi Edward

I would want to know the best trading strategy somebody can apply when the market is ranging i.e when the market is moving sideways

thanks

Victor

No moving averages are applied to RSI in this Forex strategy.

Regards,
Edward

for rsi do I use a SMA or an EMA?

Greetings to Berlin,

Some selective re-publishing is fine as long as credits are given to the original source. Thank you.

Regards,
Edward

Really, Edward...
this is one of the most interesting pages about forex, what i found.
thank you very much
can i published the (translated) strategies in my (german) webpage?
good work, follow this.
-DANKESCHÖN- like we say in german.
(Thank you)
Greetings from Berlin, Germany

Hi,

I'm not using Martingale system, but familiar with it.
I'm planning to write several topics on money management strategies, but so far got so much work to do that my other plans are resting on the highest shelve currently.
Sorry, I would probably need to leave your question open.

Strive to find an approach that would allow you to stay in the trade as long as it is on your side, and as long as the trend is valid, and cut your losing orders quickly, and to achieve that enter only at such levels where the stop can be placed close to your entry: e.g. double top/bottom formation, triple top/bottom pattern, at the test of a trend line, at Fibonacci levels, at Pivot points, at daily highs/lows, at other major support/resistance levels that you find on charts.

Regards,
Edward

Hi Edward, thanks very much for this very cool forex websites. Really help such noobie like me :D

BTW, I'm just testing this system for my demo account and found it very good! Well I'm using those RSI(7,70,30) with Stoch(5,3,3) also with a martingle system. Frankly, a manual martingle is really hard to execute.

Or is there any easy way of doing martingle? I means how to set the TP and Buy Limit orders each time the price hit the PIPS and so on.

Anyway, thanks again for a very good tips and website. Keep it up man! :D

Hi Abbey,
Every Forex trader achieves certain level of success in his/her own unique way. I started my career by simply reading all available material I found on the Internet. Soon I opened a demo account and began testing and experimenting with everything I learned.
You may choose to buy some advertised books or learn only from free sources. Nowadays, there is so much information available online about Forex that some would say there is no need to pay for books anymore. Whichever way you choose I'd recommend following those simple steps:
- start by reading free online materials about Forex trading;
- as you learn open a demo account and begin practicing; take several months to shape your basic skills;
- by the time you have quite solid base about Forex trading, you will know what kind of area you'd like to expand your knowledge in. Then you may choose to purchase some books, visit seminars or find a mentor.
- no matter how good your trading is, learning should never end.
- and last but not least - discipline. It sounds simple, but eventually you'll come to understanding why Trading Discipline sets apart successful traders from unsuccessful ones.

Best regards,
Edward

Hi Edward,pls how can one be a succesful forex trader? Is it by using these seemingly simple indicators for the ever complex and hard to understand trading system or by reading the highly advertised forex trading online textbooks? Pls I need an answer. I want to take up a career in forex trading. Thanks, Abbey

Very good addition. Thank you, Carlos!

Edward.