Forex Drawdown Strategy For Metatrader 5

Drawdowns essentially represent the difference between a high point in the balance of your trading account and the subsequent low point of your trading account’s balance.

The Forex Drawdown strategy for Metatrader 5 is designed to help you rebuild your trading account, regardless of the reduction your trading capital has suffered following some losing trades.

If you follow the rules that we’ll outline here, then you’re definitely going to withstand drawdowns.

This simply guarantees you more winning trades than losing trades.

Trade Setup 

MetaTrader 5 Indicators: Chaikin Oscillator.ex5 (Parameters Modified; Fast MA=6, Slow MA=18), hlr.ex5 (Default Setting), Instantaneous trendline levels.ex5 (Inputs Variable Modified; Period=42, Filled zones display=Don’t display the filled zones)

Trade Style: Scalping, day trading, swing trading

Trading Sessions: London | New York | Tokyo

Currency Pairs: Majors, cross pairs, exotics

Platform: Metatrader 5 (MT5)

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Download the Forex Drawdown Strategy For Metatrader 5

Buy Trade Example: AUDUSD, M30 Chart

Fig. 1.0

Trading Strategy Rules For Buy and Sell Trades Explained

Buy Entry

Enter a buy trade if the following trading conditions are met:

  1. If the light sea green line of the Chaikin Oscillator Metatrader 5 forex indicator breaksand hoversabove the 0.00 horizontal level as depicted on Fig. 1.0, price is said to be pressured higher i.e. a trigger to go long on the designated fx pair.
  2. If the red line of hlr custom indicator staysabove the 50.00 level as shown on Fig. 1.0, the general market sentiment is said to be bullish, therefore a buy alert will suffice.
  3. If the lime green line of the Instantaneous trendline levels technical indicator stayssomewhat below the price bars (see Fig. 1.0), it is pointing to increasing bulls power as such a buy stance will suffice.

Suggested Stop Loss for Buy Entry: Place stop loss 3 pips below support.

Suggested Exit Strategy/Take Profit for Buy Trade

Exit the buy trade if the following trading conditions are met:

  1. If while a bullish trend is ongoing, the light sea green line of the Chaikin Oscillator indicator falls below the 0.00 signal level as seen on Fig. 1.0, it is a trigger to exit or take profit at once.
  2. If the red line of the hlr forex indicator dips below the 50.00 level during the course of a bullish alert, price is said to be making a likely bearish reversal, as such an exit or take profit will do.
  3. If while a bullish trend is running, the Instantaneous trendline levels indicator line reverts to deep pink, it is revealing signs of probable bearish reversal i.e. a trigger to exit or take profit immediately.

Sell Entry

Open a sell trade if the following trading conditions are met:

  1. If the light sea green line of the Chaikin Oscillator forex indicator breaksand hoversbelow the 0.00 horizontal level as illustrated on Fig. 1.1, price is said to be dragged lower i.e. a trigger to go short on the currency pair of interest.
  2. If the red line of hlr custom indicator dips below the 50.00 level as exemplified on Fig. 1.1, the overall market sentiment is said to be bearish, therefore a sell signal is duly recommended.
  3. If the deep pink line of the Instantaneous trendline levels technical indicator staysfairly above the price bars (refer to Fig. 1.1), more and more bears are said to be entering the market, hence a sell will do.

Suggested Stop Loss for Sell Entry: Place stop loss 3 pips above resistance.

Suggested Exit Strategy/Take Profit for Sell Entry

Exit the sell trade if the following trading conditions are met:

  1. If during a bearish trend, the light sea green line of the Chaikin Oscillator indicator surges above the 0.00 horizontal level, it is a trigger to exit or take profit immediately.
  2. If the red line of the hlr forex indicator jumps above the 50.00 level while a bearish trend is running, a bullish reversal is said to be looming, as such an exit or take profit stance is advised.
  3. If during a bearish trend the Instantaneous trendline levels indicator line changes to lime green as illustrated on Fig. 1.1, it is pointing to signs of weaning bears power, as such an exit or take profit is recommended.

Sell Trade Example: AUDUSD, M30 Chart

Fig. 1.1

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Download the Forex Drawdown Strategy For Metatrader 5

MT5 Trading Indicators Used For This Strategy

The Chaikin Oscillator is a technical tool that displays the difference of moving averages of Accumulation/Distribution.

The hlr is short for Highest Lowest Range and typifies a Metatrader 5 forex indicator that defines the relative price position in range of the several N previous bars.

The Instantaneous trendline levels is a forex indicator that uses self-adjusting levels for buy/sell signals filtering.

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