Here is a trend based breakout strategy I’m testing that I think will show decent results.
The zone will be between the previous day’s high/low and the high/low of the last 4H candle body (must be closed). Entry signal will be when the 1H candle closes outside of the zone.
Indicators:
48MA (2 days)
240MA (10 days)
480MA (20 days)
These apply to the 1H chart only, to confirm trend.
Here’s a step by step look:
Open up your 1H chart to determine you are in a trend. All MA’s should be sloping the same way. This chart confirms the trend is up.:
Since this is trend based, we’re only looking to go long on this particular pair. Wait for the 1H candle to breach or close outside of the zone. For confirmation I am letting it close. Then place your buy order just above current price, and your SL at the bottom, outside of the zone (or at an obvious support level). I’m using R:R = 1:1.
I will be testing this strategy at all different times of the day throughout the week. Once you get the hang of it it’s pretty simple.
Got stopped out on 2 trades overnight, so I am back down to $0. The account is doing good today, looks like trends have resumed on most of the pairs I chose…
Currently:
I will let these trades run their course, but I think an adjustment is in order, too many buy/sell signals. In order to filter some out I will probably use the 1H and 4H time frames for my MA’s, instead of just the 1H. I’m looking for quality, not quantity.
I like this @MattyMoney. It is a simple strategy, its objective, it uses no off-chart indicators, it relies on following longer-term trends, it ignores sub-1 hour time-frames.
What I really like about this is it can also get you in on a pullback. If you look at my last trade GBPUSD, had I spotted it 2 or 3 hrs ago I would have had a better entry. I think I entered the trade on the final hour of the 4H candle.
That would not have made any difference with this pair though as GBP strengthened shortly after, but that’s why I didn’t use the zone to determine my SL. So, as long as the trend doesn’t change then it should come back.
I put the daily lines on my chart and , dropped down to 1hr time frame, then turned on my Darvas Box indicator and it seemed very close to the lines…this might have some merit.
Thank you MattyMoney.
My observations:
-Usually, if one MA trends up with the Price, means any number of MAs trends Up. I found the same with 20MA,50MA or 200MA.
-Universally, we get the direction of the trend with the Higher Time Frame while for the entry use the Lower Time Frame. In your case, you identified the trend with the Lower Time Frame (H1) i.o Daily, correct?
-Why we have to go back to 4H chart to expand the Zone while we may get it with Daily Support & Resistance or PVT ? And if we take the trade at the breakouts of the H1 or Daily , we may get the rally possibly upward & hit the target. Why we should take so many steps for the entry?
-You did not mention rules for the SL or TP.
Any way, good gestures. New idea , excellent!!
Not necessarily in the shorter time frames. The 48 can be rising while the longer term MA’s are sloping down. Or vice versa.
My MA’s are based on the 1H.
We go to the 4H to complete our zone. This strategy doesn’t really factor in S/R levels unless the zone is very small. But you can certainly add them for your strategy.
We use the 1H so that we can take advantage of any short term pullbacks that naturally occur with a trend. The better the entry point, the more moolah!
I hope this posts okay. If not it’s because I’m mobile and I will fix it later.
Thank you so much for your kind attention and time to explain it in detail. It is really pretty simple & I started to use your trick. I found lately, that pinpointing the central price point in 3 market phases (contraction, expansion & trending) strategy is the technique that the trend movers are using to control the whole of forex trade of the globe. They suggest to hold your position at expansion phase until trend is over to exit. But due to the zigzag pricing, I found it very difficult to identify this levels.If you got any feedback, please.
Best wishes.
