The 3-Candles trading approach is a price action strategy applicable across various time frames, including 5 and 15 minutes, or longer periods. It is well-suited for major currency pairs like AUD/USD, GBP/USD, and EUR/USD, among others.
Trading Setup
Candle Identification
To start, identify the highest candle among three adjacent ones. Then, locate the subsequent candle to the right, followed by the pivotal 3rd candle (3°Candle), which serves as the cornerstone of the strategy.
Entry Points
Initiate a trade as soon as the 3rd candle begins.
Stochastic Filter:
Utilize stochastic (9,3,3) as a filtering tool. Buy when stochastic crosses above 20 and sell when it crosses below 80. The occurrence of the 3rd candle often coincides with stochastic crossing either 80 or 20, presenting an optimal trading opportunity.
Take Profit:
Three options are available:
Close the trade after gaining 10 pips.
Adjust the stop loss to breakeven after gaining 10 pips.
Trail the trade with a stop loss set at 10 pips or higher.
Stop Loss
Buy: stop loss below the 1st candle.
Sell: stop loss above the 1st candle.
Trade step:Execute trades by following these steps:
Identify the 3rd candle based on the provided criteria.
Enter trades in line with the direction indicated by the 3rd candle.
Confirm trade signals using stochastic.
Manage trades efficiently by applying the specified take profit and stop loss strategies.
By adhering to these guidelines, traders can exploit favorable market conditions to improve their trading outcomes.
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