Forex Profit Strategy
Following the trend remains the highest priority for almost every trader. It is a uniquely directional market, which is also commonly called a trend market, that can bring very high profitability to all traders who take its direction.
However, despite understanding the meaning of a trend and what it is used for, most traders experience enormous difficulties in defining it, as well as finding an entry point.
It is for such purposes that it is customary to use trend indicators, which with a small delay, but unambiguously determine the direction of the market.
The Forex Profit strategy is a trend tactic that is based on two trend indicators, such as Moving Average and Parabolic Sar, and is intended for trading on any currency pairs.
The specificity of trend strategies is that they perform well only on higher time frames, however, Forex Profit can also be used on the minute chart after minimal changes in the indicator settings.
Preparing a strategy for work
Forex Profit can be used in any trading terminal, since the Moving Average and Parabolic Sar indicators are standard and are present in any professional trading application.
To build a strategy, plot three exponential moving averages (EMA) with periods of 10, 25, 50 with different colors.
Also, if you use the MT4 trading platform, we recommend downloading two strategy templates at the end of the article, after installation and launch of which all indicators will be displayed on the chart automatically. After downloading the template, go to the terminal data directory and place the template in a folder called Template. After restarting the platform, open the additional menu on the chart with a mouse click and select the Forex Profit template. After launch you will get the following graph:
Forex Profit Strategy Signals
The Forex Profit strategy uses a two-screen system, but not in the classical sense, when a signal from a short-term trend must correspond to a long-term one, but vice versa.
This way we will confirm the signal from the hourly chart on the fifteen-minute chart. So, on to the signals. Signal to buy:
1) The moving average with a period of 10 crosses the moving average with a period of 25 and 50 from the bottom up.
2) At the moment of intersection, the Parabolic Sar indicator point is below the price.
The stop order should be placed at the local minimum or a couple of points from the moving average with a period of 50. The position is trailed along the moving average with a period of 50, and the position should be exited if the price crosses all three lines in the opposite direction to the signal.
Before opening a position, be sure to go to the fifteen-minute chart.
When a buy signal appears, the Parabolic Sar points should be below the price. Signal to sell:
1) The moving average with a period of 10 crosses the moving averages with a period of 25 and 50 from top to bottom.
2) At the moment of intersection, the Parabolic Sar indicator point is above the price.
It is very important to limit risks at the level of the local maximum or points of the Parabolic Sar indicator.
Exit from the transaction occurs at the moment of the reverse intersection of the three moving average lines. Also, before entering the market, you should check the location of the indicator points on the fifteen-minute chart, namely, at the time of the signal, the points should be above the price. Login example:
Using the Forex Profit strategy for scalping
In addition to using the strategy for trend trading, Forex Profit is also used for scalping on the minute chart. To do this, change the moving average periods from 10, 25, 50 to 25, 50 and 100, and the Parabolic SAR indicator unchanged.
Thus, the strategy is ready for scalping and we move directly to the signals. Signal to buy:
1) The price crosses three moving lines from bottom to top and is fixed behind them.
2) At the moment of intersection, the Parabolic Sar indicator point is below the price.
Entry into the market occurs on a closed candle.
The profit for scalping is static – 10 points. The stop order should be placed at the local minimum or at the minimum of the signal candle. Example:
Signal to sell:
1) The price crosses three moving lines from top to bottom and is fixed behind them.
2) At the moment of intersection, the Parabolic Sar indicator point is above the price.
We place a stop order behind the high of the candle, and a profit of 10 points.
Example:
In conclusion, it is worth noting that the Forex Profit strategy is a universal tactic and can be used both as a trend strategy and for scalping .
However, like any Forex Profit tactic, it has its weaknesses. For example, if you decide to use a strategy on hourly charts to capture a trend, you may receive many false signals in a flat. If we talk about scalping, you should be extremely careful when trading on news, since you may be repeatedly hit by stop orders due to high volatility .
Download the necessary scripts .