1-Hour Forex Swing Trading Strategy For GBP/USD

The forex market offers investors numerous opportunities for creating profitable swing trading strategies.

On the other hand, swing trading offers a relatively relaxed trading schedule that is suitable for traders who have full-time jobs or those with busy lives.

The 1-Hour Forex Swing Trading Strategy For GBP/USD is built around the 24 exponential moving average and offers swing traders an easy way to benefit from trading the British Pound/U.S. Dollar on the hourly chart.

Let’s get started below:

Chart Setup

MetaTrader 4 Indicators: Acceleration_Bands.ex4 (Inputs Variable Modified; smPeriod=14), EMA 24, ChandeQStik_v1.ex4 (Inputs Variable Modified; Length=24)

Preferred Time Frame(s): 1-Hour (Optional: 4-Hour)

Recommended Trading Sessions: Any

Currency Pairs: GBP/USD (Optional: EUR/USD and USD/JPY)

Download

Download the 1-Hour Forex Swing Trading Strategy For GBP/USD

Buy Trade Example

Fig. 1.0

Strategy

Long Entry Rules

Initiate a buy order if the following indicator or chart patterns gets put on display:

  1. If the blue line of the 24 EMA indicator crosses the red middle band of the Acceleration Bands Metatrader 4 custom indicator bottom up (see Fig. 1.0), price is said to be driven to the upside i.e. a trigger to go long on the specified currency pair.
  2. If the light blue and orange histograms of the ChandeQStik v1 MT4 indicator gets aligned above the zero signal level as shown on Fig. 1.0, the overall sentiment is said to be bullish.

Stop Loss for Buy Entry: Place stop loss 1-3 pips below medium-term support.

Exit Strategy/Take Profit for Buy Entry

Exit or take profit if the following rules or conditions takes precedence:

  1. If while a bullish signal is running, the blue line of the 24 EMA crosses the red middle band of the Acceleration Bands indicator, an exit or take profit is duly advised.
  2. If an orange histogram of the ChandeQStik v1 custom indicator readjust to form below the zero signal level as shown on Fig. 1.0, a bearish reversal is said to be looming, hence an exit or take profit will do.

Sell Entry Rules

Enter a sell order if the following holds true:

  1. If the blue line of the 24 EMA indicator crosses the red middle band of the Acceleration Bands Metatrader 4 custom indicator in a top downward manner as depicted on Fig. 1.1, price is said to be pushed lower i.e. a trigger to go short on forex pair of interest.
  2. If the light blue and orange histograms of the ChandeQStik v1 MT4 indicator gets aligned below the zero signal level as seen on Fig. 1.1, the general sentiment is said to be bearish.

Stop Loss for Sell Entry: Place stop loss 1-3 pips above medium-term resistance.

Exit Strategy/Take Profit for Sell Entry

Exit or take profit if the following takes center stage:

  1. If while a bearish signal is ongoing, the blue line of the 24 EMA intersects the red middle band of the Acceleration Bands Metatrader 4 custom indicator, an exit or take profit is rightly recommended.
  2. If a light blue histogram of the ChandeQStik v1 custom indicator readjust to form above the zero signal level as exemplified on Fig. 1.1, price is said to be making a possible U-turn, hence an exit or take profit will suffice.

Sell Trade Example

Fig. 1.1

Free Download

Download the 1-Hour Forex Swing Trading Strategy For GBP/USD

About The Trading Indicators

The ChandeQStik_v1.ex4 indicator for MT4 is a brainchild of Tushar Chande, designed to define the strength and weakness of a security over ‘n’ period of time.

The Qstick indicator typifies the moving average of the difference between the security’s opening and closing price.

The Acceleration_Bands.ex4 custom indicator was developed by Price Headley to allow for the plotting of upper and lower envelope bands around a simple moving average.

The indicator gauges an instrument’s typical volatility over a setting of 20 bars.

The 24 EMA is an exponential moving average that has its period set at 24 and reduces the lag by adding more weight to recent price.

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