Forex Channel Strategy With Moving Average

Forex trading with channel and moving average. A simple strategy designed to trade in the direction of the main trend.

Chart Setup

Indicators: Channel-trading-signals (default settings)
Preferred time frame(s): 5 min chart and above
Trading sessions: Any
Preferred Currency pairs: Any

Download

Download the Forex Channel Strategy With Moving Average for Metatrader 4.

AUD/CAD 15 Min Chart

channel-trading-with-ma

The chart shown above shows an example of a buy trade on the Australian Dollar/Canadian Dollar.

AUD/CAD exchange rate above the channel + MA (moving average) line above the channel = buy trade. Click the chart to enlarge.

Trading Rules

Buy Rules:

  • Criteria #1: Price has to trade above the channel (established bull trend)
  • Criteria #2: Green colored moving average line has to trade above the channel

This is your buy signal. Place protective stop-loss below the most recent support level or below the lower channel band.
Targets: Book 50% profits at 1:2 risk-to-reward. Close other 50% at 1:3 (trail stop-loss 1 pip below the rising channel).

Sell Rules:

  • Criteria #1: Price has to trade below the channel (established bear trend)
  • Criteria #2: Green colored moving average line has to trade below the channel

This is your sell signal. Place protective stop-loss above the most recent resistance level or above the upper channel band.
Targets: Book 50% profits at 1:2 risk-to-reward. Close other 50% at 1:3 (trail stop-loss 1 pip below the rising channel).

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