The 5-Minute Forex scalping strategy for the CAD/JPY currency pair is a well-tested trend following scalping system designed for the M1, M5 and M15 charts.
The strategy offers the solution for traders who love to jump in-and-out of the market quickly.
You can open and close trades multiple times a day with it.
The strategy has been tested on the CAD/JPY pair but should work on any other pair of your preference.
Once you’re done installing the indicators on your MT4 platform with the included settings, your chart should look like one of those in our ensuing examples.
MetaTrader 4 Indicators: Alligator.ex4 (Parameters Modified; Jaws period=18, Teeth period=13, Lips perod=10), oT_S_Ra-Signal_Line.ex4 (Inputs Variable Modified; period=55, Colors Modified; #0=Magenta, #1=Yellow), octopus_1.ex4 (Default Setting)
Preferred Time Frame(s): 1-Minute, 5-Minute, 15-Minute
Recommended Trading Sessions: London, New York, Tokyo
Currency Pairs: Any pair
Buy Trade Example: CAD/JPY (Canadian Dollar / Japanese Yen), M5 Chart
Long Entry Rules
Initiate a buy entry if the following indicator or chart pattern gets put on display:
- If the blue line of the Alligator Metatrader 4 forex indicator crosses below the magenta line segment of the dual colored oT_S_Ra-Signal_Line indicator line and its lime and red lines in a bottom up manner as shown on Fig. 1.0, price is said to be pressured higher, therefore a buy alert will suffice.
- If the octopus_1 custom indicator pops up green bars within its window as seen on Fig. 1.0, the general market sentiment is said to be bullish, hence a trigger to go long on the designated currency pair.
Stop Loss for Buy Entry: Place stop loss below short-term support.
Exit Strategy/Take Profit for Buy Entry
Exit or take profit if the following rules or conditions takes precedence:
- If the blue Alligator indicator line intersects the yellow line segment of the oT_S_Ra-Signal_Line custom indicator while a bullish trend is on course, a bearish reversal is said to be imminent, hence an exit or take profit stance will do.
- If the octopus_1 indicator pops up a red bar within its window while a bullish trend is running (refer to Fig. 1.0), sentiments are increasingly in favor of the bears, as such an exit or take profit trigger will suffice.
Sell Entry Rules
Enter a sell order if the following holds true:
- If the blue line of the Alligator forex indicator crosses above the yellow line segment of the dual colored oT_S_Ra-Signal_Line indicator line and its lime and red lines in a top downward fashion as exemplified on Fig. 1.1, price is said to be dragged lower, thus a trigger to go short on designated fx pair.
- If the octopus_1 custom indicator pops up red bars within its window as depicted on Fig. 1.1, the overall market sentiment is said to be bearish, therefore a bearish trend is said to be on the horizon.
Stop Loss for Sell Entry: Place stop loss above short-term resistance.
Exit Strategy/Take Profit for Sell Entry
Exit or take profit if the following takes center stage:
- If the blue Alligator indicator line intersects the magenta line segment of the oT_S_Ra-Signal_Line custom indicator while a bearish trend is running, a bullish reversal is said to be in the cards, hence an exit or take profit stance is advised.
- If the octopus_1 indicator pops up a green bar within its window while a bearish trend is ongoing (see Fig. 1.1), more and more bears are said to be leaving the market, as such an exit or take profit posture is recommended.
Sell Trade Example: CAD/JPY (Canadian Dollar / Japanese Yen), M5 Chart
About The Forex Technical Indicators Used
The Alligator is a technical indicator by Bill Williams, introduced in 1995.
The indicator is comprised of three lines that are overlaid on the activity chart.
The lines represent the jaw, the teeth and the lips of the Alligator.
Forex traders tend to use this indicator to gauge trend and its likely direction.
The oT_S_Ra-Signal_Line custom indicator for Metatrader 4 is essentially the Hull Moving Average, also known as HMA.
It finds its use in the spotting of prevalent market trends.
The oT_S_Ra-Signal_Line indicator has the ability to follow price movement much closer, making it a preferred choice for traders wishing to trade in the medium and long term.
The Octopus_1 is a forex trend indicator that forms bars or histograms within its main window.
Green bars are indicative of a buy signal, while red bar denotes a sell signal.
The Octopus_1 can also be deployed for scalping the market and can be used alongside other technical studies like RSI, CCI, and Stochastics.
Start using this forex strategy in just 5 minutes. Click here to get started now.