Forex strategies are diverse and have different profit potential
Often, forex tactics called «White Ladder» are used by traders in the exchange game when trading is carried out according to the current trend.
The strategy shows the most significant and effective results on the medium-term trend. The basic concept of tactics is based on the definition of trading signals that show the onset of certain moods in the market - overbought or oversold conditions. Based on the basic rules of this strategy, buy transactions are carried out at the market lows and sell transactions - at the highs.
In other words, the white ladder is a multi-currency forex strategy that is great for use on time frames of almost any length and under any conditions of brokerage companies. But do not reduce the time scale very much: this can negatively affect trading, due to the receipt of a huge number of false signals.
To work according to the «white ladder» strategy on the chart of a currency instrument, additional installation is required - you need to include the following indicators in the terminal: 1) moving average indicator, period 50. Method of calculating MA - Simple, in which closing prices are applied. They are shown with a red line on the chart in the terminal.
2) A similarly calculated moving average indicator. But it is set for a period of 200 - the brown line.
3) William% R indicator. This instrument is set for a period equal to 14.
4) The MACD-combo indicator is used, the settings of which should not be changed, but left by default - 12.26.9.
Also, take into account such an important nuance: this trading tactic should be used for the H1 time frame. If longer periods are applied, noise is likely to occur. For a trader, a signal to buy will be such a situation in the market when such important factors are observed:
1) one of the moving averages shows positive growth dynamics;
2) the chart of the William% R instrument either crosses or touches the lower limit - level 80;
3) the histogram of the MACD-combo indicator is in the zone below the zero value. The blue line of the chart crosses the red one (rate from bottom to top).
This direction indicates that the price minimum has been passed. A trader can start buying directly from the market or using pending orders. In the latter case, the order itself should be placed at a distance equal to one point higher than the upper mark of the current candle. The stop loss level itself should be approximately equal to the value of the current extremum (this is when taking into account the spread for the pair you have chosen). The stop of purchases should occur in the field of formation of prices of 3-7 bars, and the take profit should be greater than the stop loss (two or three times). Do not forget about such a nuance as a trailing stop, which should be entrusted with purchases.
A tactic that is based on forex indicators should assume a start on sales if the following conditions are met: - two MA lines are directed downward; • William% R indicator will touch or cross the upper level 20 with a future increase; • the chart of the MACD-combo indicator is above the zero limits, and the blue line of the chart crosses the red one from top to bottom. You can exit sales using pending orders, or immediately from the market.
If this is a pending order, then it should be placed 1 point above the t of the candlestick. The stop of selling occurs after the formation of 3-7 price bars.