Simple strategies in Forex do not require the use of complicated indicators, especially superimposed on each other. Reliability of strategy, minimization of risk depends on what tactics of risk management chooses the trader and what goals it pursues. This strategy is based on my favorite indicator TEMA, which is based on moving averages.
Let me remind you that this indicator best reflects the change without any delay, and this means that you do not miss the opportunity of successful entrance. Note: strategy as a core is not considered, because it provides only one entrance to the market in one day, but as training to operate the indicator and to understand how the market works, the strategy will do just fine.
Trading by trend: entrance conditions
Introductory data of the strategy:
- trading by trend is held at the beginning of the European session. At the very beginning measure the trend by indicator and enter the market;
- trading interval – 5 minutes;
- currency pair – almost any of most liquid ones;
- terminal to work with – Metatrader 4;
- indicator parameters – TEMA (EMA_period = 200).
Download archive with template of the strategy and the indicators used
With the beginning of the session (at 9: 00 Eastern European time) look at the indicator in a time period from 00.00 till 09.00. At visual inclination more than 30°:
- open a position in the direction of the trend;
- set a fixed stop loss 10-15 points;
- exit the market at a trailing stop with a length of 10-15 points.
The strategy is simple: we catch the momentum of the market after a night session. And even if the price reverses, we still have time to take a portion of our profits on the morning inertia of the market. In this case we can not speak about large income, but in general, trade with the trend can bring some money. Remember that many things depends on the psychological mood of the trader, and the use of such strategies is aimed not so much at making a profit, but for training, and strengthening the confidence. Because with every successful transaction you become wiser, more persistent and ambitious!