3 Bar High Low Forex Trading Strategy
A trading strategy that offers simplicity with no frills attached is the kind of trading system traders prefer.
Traders are known to overly complicate things when trading by often overwhelming their charts with indicators to an extent they miss out on the primary element in their analysis.
The 3 Bar High Low Forex Trading Strategy offers a unique buy/sell market scanning approach that works very well for any currency pair and timeframe.
The criteria for entry, exit and position management are simple and well defined.
MetaTrader4 Indicators: 3-bars-high-low-indicator.ex4 (Inputs Variable Modified; PeriodCC=55, PeriodATR=15), 50 EMA, bollinger-squeeze-with-demarker.ex4 (Inputs Variable Modified; demarker_trigger8=26)
Preferred Time Frame(s): 1-Minute, 5-Minute, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours, 1-Day, 1-Week
Recommended Trading Sessions: Any
Currency Pairs: Any pair
Buy Trade Example
Long Entry Rules
Enter a bullish trade if the following indicator or chart pattern gets put on display:
- If the magenta line of the 50 EMA indicator crosses the mostly lime line section of the 3-bars-high-low-indicator Metatrader 4 custom in a bottom up manner as seen on Fig. 1.0, price is said to be driven higher, hence a trigger to buy the stipulated currency pair.
- If the gray line and green histograms of the bollinger-squeeze-with-demarker Metatrader 4 forex indicator break & hover above the zero signal level as depicted on Fig 1.0, price is said to be driven higher i.e. a signal to go bullish on the desired currency pair.
Stop Loss for Buy Entry: Place stop loss below medium-term support.
Exit Strategy/Take Profit for Buy Entry
Exit or take profit from all trades if the following rules or conditions takes precedence:
- If the magenta line of the 50 EMA indicator line intersects the 3-bars-high-low-indicator line while a bullish trend is running, price is said to be making a possible U-turn, hence an exit or take profit is advised.
- If the gray line of the bollinger-squeeze-with-demarker indicator break below the zero center line as illustrated on Fig. 1.0, bulls power is said to be weaning, hence an exit or take profit will suffice.
Sell Entry Rules
Go short if the following setups gets displayed successfully on the activity chart:
- If the magenta line of the 50 EMA indicator crosses the mostly orange red line section of the 3-bars-high-low-indicator Metatrader 4 custom indicator in a top downward fashion as shown on Fig. 1.1, price is said to be pushed lower i.e. a trigger to go short on the forex pair of interest.
- If the gray line and Indian red histograms of the bollinger-squeeze-with-demarker Metatrader 4 forex indicator break & hover below the 0.00 center line as exemplified on Fig. 1.1, price is said to be pushed lower i.e. a signal to go bearish on the selected fx pair.
Stop Loss for Sell Entry: Place stop loss above medium-term resistance.
Exit Strategy/Take Profit for Sell Entry
Exit or take profit if the following takes center stage:
- If the magenta line of the 50 EMA indicator line intersects with the 3-bars-high-low-indicator line during a bearish signal, it is indicative of weaning bears power, as such an exit or take profit is recommended.
- If the gray line of the bollinger-squeeze-with-demarker indicator surge above the zero center line (see Fig. 1.1), bears power is said to be halting, hence an exit or take profit will do.
Sell Trade Example
About The Trading Indicators
The 50 EMA is an exponential moving average that has its period set at 50 and reduces the lag by adding more weight to recent price.
The bollinger-squeeze-with-demarker.ex4 custom indicator is built on the stochastic, CCI, RSI, MACD, Williams % and the demarker indicators.
It is an important tool that helps traders effectively gauge price volatility.
The 3-bars-high-low-indicator.ex4 is a custom indicator that takes the shape of a moving average, and has the CCI and ATR indicators as its building block.
It uses a line color changing scheme to define the prevalent market trend.