Stochastic trend-momentum scalping is a
classic very simple strategy based on stochastic oscillator.
Time Frame 5 minute chart.
Currency pairs: USD/JPY, GBP/USD,
EUR/USD.
Sessions: London and New York.
Indicators:
Stochastic oscillators 13, 8, 3, close.
Step 1 open the 60 min chart and
determine the trend with two moving averages: 11 EMA and 50 EMA if 11
EMA is Above a 50 EMA there is an up trend if the 11 EMA is below the
50 EMA there is a down trend.
Step 2
If trend is up with EMA 11>EMA 50
on 60 min chart – only buy trades. Let’s say the current trend is
up and the price has been up. Then the market pulls back – the
stochastic indicator crosses down too. No Entry here (current trend
is UP).
Once the price bounces the bottom
(support) and goes up again – wait till stochastic crosses and
place “long entry” order.
If trend is down with EMA 11<EMA 50
on 60 min chart – only sell trades. Let’s say the current trend
is down and the price has been down. Then the market pulls back –
the stochastic indicator crosses up too. No Entry here (current trend
is down).
Once the price bounces the top
(resistance) and goes down again – wait till stochastic crosses and
place “short entry” order.
Place stop loss 5 pips below/above the
entry bar. Profit target 8-12 pips.
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