Combining technical studies can offer a great insight into forex price patterns and adding the Aroon oscillator, 3MAFan and Force Index MT4 indicators can do just that and whole lot more.
The 3MA Fan forex trading strategy is every trader’s delight and you’ll see just why as you read along.
MetaTrader4 Indicators: Aroon-oscillator.ex4 (default setting), 3MAFan.ex4 (width modified), Force Index.ex4 (default setting)
Preferred Time Frame(s): 1-Minute, 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours
Recommended Trading Sessions: Any
Currency Pairs: any
Buy Trade Example (Click the image for full size view)
Long Entry Rules
Place a buy order when the following chart pattern are in display:
- If the lines of the 3MAFan intersect and a bullish candle opens and closes above the aqua colored line of the indicator, it is a bullish signal.
- If the Aroon-oscillator line climbs above the 0.00, a move that depicts a buy signal as shown on Fig. 1.0 i.e. the area within the red vertical lines, depicts the line above the 0.00 level.
- If the aqua colored line of the Force Index climbs above the 0.00 level, it is a signal for a buy.
Stop Loss for Long Entry: Place stop loss 2 pips below support.
Exit Strategy/Take Profit for Long Entry
The following rules or conditions will define an exit or take profit strategy:
- If a bearish candle closes below the aqua colored line of the 3MAFan indicator, an exit or take profit is advised.
- If the Aroon-oscillator line slumps below the 50.0 level, it denotes a reversal and as such an exit or take profit is advised.
- If the Force Index falls below the 0.00 level, it signals an increasing downward pressure, making an exit or take profit an appropriate line of action.
Sell Entry Rules
Place sell orders when the following conditions are in place:
- If the lines of the 3MAFan custom indicator intersects and a bearish candle opens and closes beneath the aqua line of the indicator, place a sell order.
- If the Aroon-oscillator line slumps below the 0.00 level, it I an indication that price is being pressured lower.
- If the aqua line of the Force Index falls below the 0.0000 level, it does also support a bear market.
Stop Loss for Sell Entry: Place stop loss 2 pips above resistance.
Exit Strategy/Take Profit for Sell Entry
- Exit or take profit on position(s) when a bullish candle closes above the aqua line of the 3MAFan custom indicator.
- If the Aroon-oscillator bounces above the -50.0 level, an exit or take profit is advised.
- Exit or take profit on the Force Index if its line pushes above the 0.0000 level.
About The Trading Indicators
The 3MAFan.ex4 is also known as the 3 Moving Average Fan indicator and is built upon the 5, 21, 55 MAs, offering traders the ability to determine trend on all timeframes.
The Aroon-oscillator.ex4 is a trend finder that I calculated as the difference between the Aroon Up and Aroon Down.
A strong bullish trend is depicted when the indicator exceeds 50 to 100, while -50 to -100 defines a strong bearish trend.
The Force Index.ex4 was developed by Alexander Elder, as an indicator that deploys price and volume as tools to measure the strength behind a move or pinpoint the likely turning points.