Forex Day Trading System

Forex Day Trading System is a trend-momentum strategy. Forex Day Trading System I use two moving averages: EMA 14, and EMA 42.

Time frame 5 min or higher.

Currency pairs: majors.

Forex Indicators:

EMA period 14, close;

EMA period 42, close;

If EMA 14 > EMA 42 then theTrend is Up, you must wait a buy signal.

If EMA 14 < EMA 42 then theTrend is Down., you must wait a sell signal.

RSI period 21, close, as filter.

William’s %R period 7, close; I use it to find the turn point of pullback.

Parabolic SAR (0.02 – 0.2) as levels of stop loss.

Trading Rules

Buy

Long Pre-signal when RSI > 50 before EMA 14 cross up EMA 42.

For a long signal, it’s better if the down candlestick close under EMA 14 period.

If we wait a Long signal, we take a position with an Up candlestick:

When you have an Up candlestick, we enter if prices cross his High, with a market order.

Sell

Short Pre-signal when RSI < 50 before EMA 14 cross down EMA 42.

For a short signal, it’s better if the up candlestick close above EMA 14.

If we wait a Short signal, we take a position with a Down candlestick:

When you have a Down candlestick, we enter if prices cross his Low If we wait a long signal and prices cross the high of the Down candlestick that gives the signal. We can take a position.

And if we wait a short signal with prices cross the low of the Up candlestick that gives the signal. We can take a position too.

In this case, we’ll enter when prices cross:

The High of the doji for a Long signal

The Low of the doji for a short signal

The Exit

To exit we have many choices :

When prices touch the “-38,2%” level Fibonacci, we can go out immediately.

We can exit when prices close above the “-38,2%” Fibonacci for a long trade or under it for a short trade.

Profit Target ratio stop loss 1:1.5.

At the Pvot Points Levels.

I take the SAR and put my stop loss under it for a Long signal or above it for a Short signal.