GBP/CHF Forex Trading Strategy
The GBP/CHF Forex trading strategy uses the clouds of the Ichimoku Kinko Hyo indicator to identify new market trends.
The timing indicator, which is part of this strategy is used as a trend confirmation tool.
When the timing indicator’s line is above the 50 level and rising, it means a bullish trend is commencing, while if the opposite happens, then it can be interpreted as the start of a bearish trend.
The GBP/CHF Forex trading strategy works for any trade style, including scalping, day trading and swing trading.
MetaTrader 4 Indicators: Ichimoku Kinko Hyo.ex4 (Colors Modified; Tenkan-sen=None, Kijun-sen=None, Chikou Span=None), Timing.ex4 (Inputs Variable Modified; Len=21)
Preferred Time Frame(s): 1-Minute, 5-Minute, 15-Minute, 30-Minute, 1-Hour, 4-Hour, 1-Day, 1-Week, 1-Month
Recommended Trading Sessions: Any
Currency Pairs: GBP/CHF + any other pair
Buy Trade Example: GBP/CHF (Great Britain Pound / Swiss Franc), H1 Chart
Long Entry Rules
Initiate a buy entry if the following indicator or chart pattern gets put on display:
- If the sandy brown cloud of the Ichimoku Kinko Hyo Metatrader 4 indicator aligns somewhat below the candlesticks as depicted on Fig. 1.0, market is said to be in favor of bullish sentiments, therefore a buy trigger will suffice.
- If the multi-colored (yellow, green & orange) line of the Timing custom indicator breaks and stays above the 50.00 horizontal level as illustrated on Fig. 1.0, price is said to be pressured higher i.e. a trigger to go long on the currency pair of focus.
Stop Loss for Buy Entry: Place stop loss below support.
Exit Strategy/Take Profit for Buy Entry
Exit or take profit if the following rules or conditions takes precedence:
- If the Ichimoku Kinko Hyo forex indicator pops up a thistle colored cloud while a bullish trend is ongoing, price is said to be making a U-turn, as such an exit or take profit stance is recommended.
- If the multi-colored (yellow, green & orange) Timing forex indicator line dips below the 50.00 reference level while a bullish trend is on course (see Fig. 1.0), more and more bulls are said to be closing their market orders, hence an exit or take profit stance will suffice.
Sell Entry Rules
Enter a sell order if the following holds true:
- If the thistle colored cloud of the Ichimoku Kinko Hyo indicator aligns fairly above the price bars as seen on Fig. 1.1, the overall market sentiment is said to be bearish i.e. a trigger to go short on the currency pair of interest.
- If the multi-colored (yellow, green & orange) line of the Timing forex indicator dips and stacks below the 50.00 signal level as exemplified on Fig. 1.1, more and more bears are said to be taking up positions, thus a signal to go short on the selected forex pair.
Stop Loss for Sell Entry: Place stop loss above resistance.
Exit Strategy/Take Profit for Sell Entry
Exit or take profit if the following takes center stage:
- If the Ichimoku Kinko Hyo forex indicator displays a sandy brown cloud during the course of a bearish trend, bears power is said to be weaning, hence an exit or take profit stance is advised.
- If the multi-colored Timing forex indicator line surges above the 50.00 reference level while a bearish trend is ongoing (refer to Fig. 1.1), bears are said to be leaving the market increasingly, hence an exit or take profit stance will do.
Sell Trade Example: GBP/CHF (Great Britain Pound / Swiss Franc), H1 Chart
About The Forex Technical Indicators Used
The Ichimoku Kinko Hyo indicator is an appropriate technical tool, particularly for newbies who want to understand trend momentum, direction, pinpointing reversals and locating entry levels on the forex chart.
The Timing custom MT4 indicator is an oscillator that explains overbought (70 -100 region) and oversold (0 -30 region) conditions in the market.
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