Another dynamic scalping system composed of two moving averages: the 144 period linear weighted moving average and 5 period smoothed moving average.
We make buy and sell decisions based on the crossover of these two moving averages.
An excellent fx strategy for beginners. Let’s begin…
Chart Setup
Indicators: 144 period linear weighted moving average, 5 period Smoothed moving average
Preferred time frame(s): 5 Min charts
Trading sessions: London and US Session
Preferred Currency pairs: EUR/USD, GBP/USD, USD/JPY (medium volatility)
Download
Download the 20 pips Forex Scalping Strategy with Linear Weighted Moving Average for Metatrader 4.
GBP/USD M5 Trading Example
As you can see in the chart above, it’s really easy to benefit from this strategy. 4 Trading signals: 3 winners for 60 pips and 1 loss for 15 pips (did not reach the 20 pips profit target).
Trading Rules
Buy Rules:
- The 5 period smoothed moving average crosses up the 144 period linear weighted moving average from below.
Initiate buy trade. Stop-loss: Below the most recent swing low point or 15 pips (whichever comes first).
Price objective: exit for 20 pips.
Sell Rules:
- The 5 period smoothed moving average crosses down the 144 period linear weighted moving average from above.
Initiate sell trade. Stop-loss: Above the most recent swing high point or 15 pips (whichever comes first).
Price objective: exit for 20 pips.