Wave Momentum – Forex Strategy -

Wave momentum is a slow trend Momentum strategy based on moving averages, stochastic oscillator and slow MACD but is very efective for trading.

Time frame 30- 60 min, 12o min, 240 , min and 480 min.

Currency pairs: Majors and Minors.

Indicators setting:

exponential moving average 6 period (median);

exponential moving average 23 period (median).

Oscillator Stochastic (21, 3,8);

MACD (30, 60, 30).

Trading Rules

Long Entry

EMA 6 crosses above EMA 23, MACD indicates an uptrend, stochastic crosses upward, buy as close to the 6 EMA as possible.

Short entry

EMA 6 crosses below EMA 23, MACD indicates a downtrend, stochastic crosses downward, sell as close to the 6 EMA as possible.

Exit position

Stop Loss: 20 – 30 or more depends by time frame and currecy pairs pips

Profit Target: 50 - 60 or more pips.

Note: when the stochastic oscillator and the MACD agree the entry can be anticipated if the candle closes above or below the moving averages but still have not crossed, because in the specific case that the candle closes below / above the moving averages, the signal generated by the two oscillators is strong and significant being configured slow.

Wave momentum is a very simple strategy to follow which aims to enter the trend by filtering false retracement signals. The rhythms of the MACD stochastic oscillator are very linear and seem waves.

In the pictures Wave Momentum – Forex Strategy – trades examples.