Doda Stochastic Forex Scalping Trading Strategy

The Doda Stochastic forex trading strategy is a scalping strategy that is designed to allow traders of scanning the market on the lower timeframe’s and earning tiny bits of profits on every trade.

Tiny bits of profits can become a substantial amount of profits if sustained!

This strategy will help you achieve just that and should be used on the 1-Minute, 5-Minute and 15-Minute chart.

Chart Setup

MetaTrader4 Indicators: Doda-Stochastic.ex4 (Input Variable modified; Slw=16.0, Pds=26.0, Slwsignal=18.0), Doda-Donchian.ex4 (color width  modified; Red=2), 50 SMA

Preferred Time Frame(s): 1-Minute, 5-Minute, 15-Minute

Recommended Trading Sessions: Any

Currency Pairs: Any pair

Download

Download the Doda Stochastic Forex Trading Strategyy

Buy Trade Example

Fig. 1.0

Strategy

Long Entry Rules

Enter a buy in the market if the following indicator or chart pattern takes precedence:

  1. If the lime line of the Doda-Stochastic.ex4 custom indicator crosses its red line bottom up below the 20.00 level (the oversold region), breaking and staying above the 20.00 as shown on Fig. 1.0, price is said to be driven higher i.e. a signal to buy the asset of interest.
  2. If the magenta line of the 50 SMA indicator crosses the red line of the Doda-Donchian.ex4 custom indicator bottom up, it is an indication of bullish pressures i.e. a signal to go long on the pair of interest.

Stop Loss for Buy Entry: Place stop loss 2 pips below support.

Exit Strategy/Take Profit for Buy Entry

Exit or take profit if the following holds sway on the activity chart:

  1. If the lime line of the Doda-Stochastic.ex4 custom indicator crosses its red line top downward when in the overbought region (above the 80.00 signal level) and then breaks below the 80.00 signal level, it is a signal to exit or take profit forthwith.
  2. If the magenta line of the 50 SMA indicator crosses the red line of the Doda-Donchian.ex4 custom indicator top downwards during a bullish signal, we can conclude that the bulls power is weaning, hence an exit or take profit is recommended.

Sell Entry Rules

Enter a sell in the market if the following holds true:

  1. If the lime line of the Doda-Stochastic.ex4 custom indicator crosses its red line top downward above the 80.00 level (the overbought region), breaking and staying below the 80.00 as depicted on Fig. 1.1, price is said to be pushed lower i.e. a signal to sell the asset of interest.
  2. If the magenta line of the 50 SMA indicator crosses the red line of the Doda-Donchian.ex4 custom indicator top downward, it is an indication of bearish pressures i.e. a signal to go short on the currency of interest.

Stop Loss for Sell Entry: Place stop loss 2 pips above resistance.

Exit Strategy/Take Profit for Sell Entry

Exit or take profit if the following takes center stage:

  1. If the lime line of the Doda-Stochastic.ex4 custom indicator crosses its red line bottom up when in the oversold region (below the 20.00 signal level) and then breaks above the oversold region as shown on Fig. 1.1, it is a signal to exit or take profit forthwith.
  2. If the magenta line of the 50 SMA indicator crosses the red line of the Doda-Donchian.ex4 custom indicator bottom up during a bearish trend, we can conclude that the bears power is halting, hence an exit or take profit is recommended.

Sell Trade Example

Fig. 1.1

Free Download

Download the Doda Stochastic Forex Trading Strategy

About The Trading Indicators

The Doda-Donchian.ex4 is a custom indicator produced by Gopal Krishan Doda and popularly known as the turtle indicator.

It is a trend following indicator that deploys the EMA (120) coupled with other values to eliminate noise when scanning the market for trend changes

The Doda-Stochastic.ex4 custom indicator is a momentum indicator that compares the closing price of a forex pair or symbol to the range of its prices over s specified time period.

The 50 SMA is a Simple Moving Average set at period 50.

Share Now!