FOREX SIMPLE STRATEGY Part I
This strategy is designed to quickly show a trader how to find high probability entry signals. It is not meant to be your sole method of trading.
There are more efficient ways of determining the direction of the trend but that can be learned in follow-up steps as you develop your trading skills.
You can watch the short video as well as read the written instructions for this trading strategy.
The most effective use of the strategy is to determine the direction of a trend.
So you go to a larger time frame in this case we will be talking about the day chart. You want to find some higher highs and higher lows or some lower highs and lower lows. That determines the direction that you will be trading.
We will be using three time frames for this strategy. We will use the day has a larger time frame, the four hour time frame to confirm the direction to trade, and the one hour to enter the trade.
We’ll be looking for a fresh MAO cross. This is where the MAO crosses above or below the zero line. You first look for a fresh cross on the day time frame, then you look for a confirmation of the four hour timeframe, then you look for an entry on the one hour time frame in the direction of the confirmation of the day and four hour timeframes.
Once you’ve entered the trade you go to the four hour timeframe to manage the trade. For example: you find the trend on the day chart, you confirmed on the four hour chart, and you entered on the one hour chart. You then go to the four hour chart to manage the trade.
What is it mean to manage a trade. It means this is the time frame you will be looking for exit signals on.
What you’re using for an exit signal is where the hotlines cross. The hotlines are two moving averages. When you enter the trade the moving averages will be pointing up for a long or pointing down for a short trade. When the hotlines cross in the opposite direction on the four hour time frame this is your signal to exit the trade.
In part two of the strategy we will go through a working example so you can learn the strategy quickly and start to use it right away.