The Chaos Oscillator Forex strategy is a trading strategy that is designed to greatly minimize false buy and sell signals during the various trading sessions.
In doing so, it employs a risk tolerance trading style that sticks to price action steadily.
The first thing you need to do to kick start this strategy is to add the prescribed technical indicators along with its recommended settings on the currency pair of interest.
This will help you validate buy or sell market signals quite easily.
Let’s get things rolling with the included examples, so you can get conversant this amazing Chaos Oscillator Forex strategy.
MetaTrader4 Indicators: chaos-oscillator.ex4 (Inputs Variable Modified; gi_76=36, Colors Modified; #1=Red, #2=Blue, Colors Width Modified; #1=2, #2=2), ichimoku-average-indicator.ex4 (Default Setting)
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 red vertical bars of the chaos-oscillator Metatrader 4 forex indicator gets stacked within its window as seen on Fig. 1.0, the overall market sentiment is said to be bullish, thus a trigger to buy the designated forex pair.
- If the sandy brown cloud of the ichimoku-average-indicator gets aligned below the candlesticks as illustrated on Fig. 1.0, price is said to be pressured to the upside, thus a signal to go long on the designated forex pair.
Stop Loss for Buy Entry: Place stop loss below key support.
Exit Strategy/Take Profit for Buy Entry
Exit or take profit from all trades if the following rules or conditions takes precedence:
- If while a bullish trend is ongoing, the chaos-oscillator custom indicator pops up a blue vertical bar within its window as depicted on Fig. 1.0, bulls are said to be taking a probable hit, as such an exit or take profit stance is advised.
- If the ichimoku-average-indicator cloud reverts to thistle during the course of a bullish signal, bulls are said to be leaving the market more and more, therefore an exit or take profit will suffice.
Sell Entry Rules
Go short if the following setups gets displayed rightly on the activity chart:
- If the blue vertical bars of the chaos-oscillator forex indicator gets stacked within its window as shown on Fig. 1.1, the general market sentiment is said to be bearish, therefore a sell alert is said to be looming.
- If the thistle cloud of the ichimoku-average-indicator gets aligned above the candlesticks as exemplified on Fig. 1.1, price is said to be dragged lower, thus a trigger to sell the currency pair of interest.
Stop Loss for Sell Entry: Place stop loss above key resistance.
Exit Strategy/Take Profit for Sell Entry
Exit or take profit if the following takes center stage:
- If the chaos-oscillator forex indicator pops up a red vertical bar within its window while a bearish trend is running (see Fig. 1.1), bears power is said to be diminishing, as such an exit or take profit stance will do.
- If the ichimoku-average-indicator cloud reverts to sandy brown while a bearish trend is ongoing, bears are said to be leaving the market in their droves, therefore an exit or take profit is advised.
Sell Trade Example
About The Trading Indicators
The chaos-oscillator is a simple and useful tool that is comprised of vertical bars of red and blue, used in defined bullish and bearish market conditions respectively.
The ichimoku-average-indicator is an Ichimoku indicator that uses a moving average as a substitute for the middle price channel or Donchian Channel.