Candlestick Scalping -- Rocket Ship Method

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1

Greetings everyone,

I wanted to share with you an extremely simple scalping technique using just candlesticks. This strategy is based on nothing other than my experience in the past and some common sense.

Load up any chart and put it on 1minute TF. Remove all indicators. Use only candlesticks, with your choice for the colors and background, etc.

–STRATEGY–

Watch the candlesticks closely. I’ll now describe the behavior pattern you need to watch for. It’s somewhat tough to explain, but once you grasp it you’ll be able to bag some quick pips.

Occasionally, you will see a big upswing or downswing, resulting in a very large candlestick. This will happen very quickly and unexpectedly. Immediately after the big candlestick forms and before it can close, it will act as if it is afraid to change that quickly and quickly retrace back near the ORIGIN. During its retrace, it will NOT QUITE MAKE IT BACK TO ITS ORIGIN, and the candlestick will now have a very long wick.

This is the critical moment!! Simply place an order in the original direction the candlestick was moving before it retraced back near its origin. 99% of the time the candlestick will repeat it’s previous action and jump way down or up again.

To help you understand this better, I’ve come up with this brilliant analogy (lol). Think of it like a ROCKET SHIP blasting into space. The origin will be the launching pad. The rocket ship starts its engines and thrusts up into space quickly. During its climb (or descent, if the candlestick is going down), the engines stall in mid-air and the rocket ship comes crashing back down to the launching pads. Just before the collision, the astronauts get the engines running and the rocket ship recovers momentum and continues its climb (or descent) back into space.

–NOTES–

Yes, it’s very simple but IT WORKS! It works on any currency pair, but you have to stick to the 1 minute time frame.

If you can time it just right, this method can be very rewarding for grabbing 4 - 10 pips. Most of the time, by the time the order is processed, you will all ready be even or up a few pips.

With a trailing stop EA, this could be a great method to scalp a few pips each trade.

The biggest downfall to this method is that it’s not very often that we see such huge swings in the market. Since it works on all currency pairs though, you could potentially keep scanning 10+ charts at a time waiting to employ the ROCKET SHIP METHOD.

Good luck and happy trading!

-ForexPhantom-

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hi forexphantom,
interesting that no reply yet.
how long have you been using this model and do you still use it?
if you still use it would be better to show an example on a chart.
nice pips…

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You know, whenever I enter a trade, one of the things that motivates me is a long candle in the direction I want to trade. I enter my order, only for the candle to shrink, before continuing the trend. So I always say to myself, "Wait for the nice big candle to retrace, to get in at a better price!

It’s like an elastic band, it stretches and then goes back, never thought of trading it. But I might just give it a try.

4

To trade this method, it looks like we need to have quick reflex, high speed computer and emotionless trading. The third one looks difficult to achieve and if we don’t… risk an heart attack !
Edit : Nice name “Rocket Ship” Do you use stoploss ? What time zone/pairs you found it more effective ?
Regards,
Muthu.

1 Like
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I will watch it and let you know my observations.
It seems like a tight stop can be placed 1-2 pips above/below the end of the candle which is good because perhaps we can achieve a good r/r ratio this way.

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Just looking at scalping threads and was reading this, noticing that it is very similar to something I saw on BKForex. They have a YouTube video (click here) that describes essentially the same strategy, but off the 5m charts.

Have you continued trading this way, Phantom?