The AMA Expert forex trading strategy allows currency traders to get in and out of the market rapidly and profitably as well.
Implementing this strategy unto charts is hassle-free and works well on M1, M5 and M15 trading charts. This strategy works well for scalpers and day traders.
Chart Setup
MetaTrader4 Indicators: AMA_for_Expert2.ex4 (width modified; 2), RSItv.ex4 (default setting), RSTL.ex4 (default setting)
Preferred Time Frame(s): 1-Minute, 5-Minutes, 15-Minutes
Recommended Trading Sessions: New York Open | London Open
Currency Pairs: Low spread pairs, 4 pips maximum
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Buy Trade Example
Fig. 1.0
Strategy
Long Entry Rules
Initiate a long entry if the following indicator or chart pattern gets displayed:
- If the dark violet line of the RSTL custom indicator crosses the lime colored line of the AMA_for_Expert2 indicator bottom up as seen on Fig. 1.0, it is a signal to go bullish i.e. a buy entry. Usually, the dark violet line of the RSTL indicator aligns itself below the lime colored line AMA_for_Expert2 indicator, while price is seen to be trading above it.
- If the Lime colored line of the RSItv.ex4 custom indicator breaks above the 50.00 signal level, price is said to be bullish and a buy entry is most appropriate.
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 are in place:
- If price closes below the dark violet line of the RSTL indicator or if the lime colored line of the AMA_for_Expert2 indicator crosses the dark violet line of the RSTL indicator top downward, it is a signal to exit or take profit without delay.
- If the line of the RSItv.ex4 custom indicator breaks below the 50.00 level while its color turns red, it is a sign of weaning bullish momentum and an exit or take profit is advised.
Sell Entry Rules
Place a sell order if the following indicator or chart pattern gets displayed:
- If the dark violet line of the RSTL custom indicator crosses the lime colored line of the AMA_for_Expert2 indicator top downward as seen on Fig. 1.1, it is a trigger to go bearish i.e. a sell entry. The dark violet line of the RSTL indicator is positioned above the lime colored line AMA_for_Expert2 indicator, while price is seen to be trading below it. The wider the distance between them, the stronger the trend will be.
- If the red colored line of the RSItv.ex4 custom indicator breaks below the 50.00 signal level, price is said to be bearish i.e. a trigger to go short.
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 rules or conditions take precedence:
- If price closes above the dark violet line of the RSTL indicator or if the lime colored line of the AMA_for_Expert2 indicator crosses the dark violet line of the RSTL indicator bottom up, it is a signal to exit or take profit straight away.
- If the line of the RSItv.ex4 custom indicator pushes above the 50.00 signal level while its color turns lime, it is a sign of weaning bearish momentum and an exit or take profit is advised.
Sell Trade Example
Fig. 1.1
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About The Trading Indicators
The RSItv.ex4 is an indicator deigned for the MT4 platform and is a smoothed Relative Strength Index that produces a sound alert when the 50.00 signal level is crossed (upward or downward).
The Reference Slow Trend Line (RSTL) is a response “slow” trend line. The indicator is similar to the simple moving “averages” from the standpoint of their delay in relation to the current prices.
The AMA_for_Expert2.ex4 is an optimized variant of the Adaptive Moving Average (AMA), and does take into account the volatility ratio.
The line of the indicator smoothens out greatly to yield a slower average, which invariably should produce more consistent result during price consolidation or sideways market.