A simple flat strategy for trading on Forex and the stock market
The trend does not always move in an upward or downward direction; sometimes there is relative calm in the market and the price moves in a horizontal direction; many traders consider such moments to be unlucky for trading.
On the contrary, it is at this time that I earn the greatest profit; when using the flat strategy on Forex, it practically does not fail.
The flat strategy is as simple as possible; it is based on placing pending orders, which are triggered immediately after the appearance of a dynamic trend.
In practice, you conduct automatic trading, participating in trading only at its very initial stage, setting the main indicators of a new order.
A new order will open if a new trend begins, and will close as soon as the profit reaches the level you specified.
Basic conditions for applying the flat strategy in practice
The first condition for using the flat is that there is a relatively weak trend in the Forex market, that is, the price should not change by more than a few points within an hour.
The market is waiting at this time, the situation is quite uncertain and it is not known where the price will go in the near future. price channel is often formed in which the price moves; the width of such a channel is no more than 100-150 points with a five-digit quote.
Based on the minimums and maximums, it is easy to build a horizontal channel that will clearly show the market situation.
As soon as you have discovered such a situation, and it can arise for almost any currency pair, we begin to apply our trading strategy.
At the initial stage, the flat strategy involves performing the following actions:
1. We analyze the trend - more precisely the width of its corridor, that is, we find the minimum and maximum from the beginning of the flat. For example, the minimum price during the hour was 1.2535, and the maximum was 1.2555, these will be our starting points when placing pending orders.
2. Buy order - we place it 10 points further than our maximum, for example, 1.2565, in this case we will avoid false breakouts and the order will only work when a new trend appears, this value can be changed depending on the width the range in which the price moves.
Stop loss - set 10 - 15 points below the order trigger level, because there is a possibility that the order will trigger and the price will begin to fall, and in this way we will protect our deposit from being drained.
Take profit - set accordingly 10-15 points above the price level, for example, at 1.2580, you should not overestimate the size of the planned profit, since in the event of a reverse move you will not only not receive your 15 points, but you may also have to wait for it to be triggered stop loss.
3. Sell order - we place it according to a similar scheme, only below the minimum price by 10 points, that is, based on our example at the point 1.2525.
Stop loss in this case will be equal to 1.2540
take profit in the area – 1.2510
Indeed, in this case, we work in the opposite direction; therefore, in order to make a profit, we need to close the transaction below the opening price.
Out of habit, I write four-digit quotes in the description; it is clear that if you are working on five signs, you should make adjustments and increase the values 10 times.
According to my personal experience, the flat trading strategy gives more than 70% of profitable trades, so if used correctly, the final financial result is always positive.
If you wish, you can always make your own adjustments to this trading option and increase the amount of profit or reduce the resulting losses, but why change anything if this is really a working Forex strategy for flat trading.
An indicator that will help make your strategy even more effective - https://time-forex.com/indikators/bb-trend-flat
You will find other equally effective trading strategies at the link - http://time-forex.com/strategy