H4 Forex Trading Strategy

The H4 (4-hour) Forex trading strategy makes use of a fine combination of technical indicators that are applied to the 4-hour charts.

This strategy offers a profitable way for traders to trade on the longer-term timeframes.

Traders can readily take advantage of the opportunity of not being overly glued to their trading screen when trading this longer-term strategy because you only need to check the chart every 4-hours.

You can apply this strategy to the daily and weekly charts as well. Just try it, it works!

The buy/sell rules are simple and entails the adoption of trade setups from three distinct technical indicators.

Let’s get things started with the highlighted examples…

Chart Setup

MetaTrader4 Indicators: EMA 5 10 34 Crossoverl.ex4 (Inputs Variable Modified; FasterMA=10, MediumMA=15, SlowerMA=36), Elliott_Wave_Oscillator.ex4 (Default Setting), Relative Vigor Index.ex4 (Parameters Modified; Period=28)

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: Any pair

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Buy Trade Example: AUD/NZD (Australian Dollar / New Zealand Dollar), H4 Chart

Fig. 1.0

Strategy

Long Entry Rules

Initiate a buy entry if the following indicator or chart pattern gets put on display:

  • If the blue upward pointing arrow of the EMA 5 10 34 Crossoverl custom indicator pops up somewhat below the candlesticks as seen on Fig. 1.0, price is said to be driven to the upside i.e. a trigger to buy the designated forex pair.
  • If the lime & green histograms of the Elliott_Wave_Oscillator indicator break above the 0.00 horizontal level as shown on Fig. 1.0, bulls are said to be driving price higher, thus a buy trigger will suffice.
  • If the green & red lines of the Relative Vigor Index Metatrader 4 forex indicator break above the 0.00 reference level as illustrated on Fig. 1.0, bulls are said to be driving price higher, as such a buy alert will suffice.

Stop Loss for Buy Entry: Place stop loss below medium-term support.

Exit Strategy/Take Profit for Buy Entry

Exit or take profit if the following rules or conditions takes precedence:

  • If the EMA 5 10 34 Crossoverl indicator popsup a red downward pointing arrow while a bullish trend is ongoing, it is indicative of diminishing bulls power, therefore a trigger to exit or take profit immediately.
  • If the Elliott_Wave_Oscillator indicator pops up a red histogram below the 0.00 horizontal level during the course of a bullish trend, it is a signal to exit or take profit at once.
  • If the green line of the Relative Vigor Index indicator dips below the 0.00 horizontal level while a bullish trend is running (see Fig. 1.0), it is a signal to exit or take profit forthwith.

Sell Entry Rules

Enter a sell order if the following holds true:

  • If the red downward pointing arrow of the EMA 5 10 34 Crossoverl custom indicator pops up fairly above the candlesticks as exemplified on Fig. 1.1, price is said to be dragged lower i.e. a trigger to sell the currency pair of interest.
  • If the red & maroon histograms of the Elliott_Wave_Oscillator indicator break below the 0.00 horizontal level as depicted on Fig. 1.1, bears are said to be driving price lower, thus a sell trigger will do.
  • If the green & red lines of the Relative Vigor Index forex indicator breakbelow the 0.00 reference level (refer to Fig. 1.1), bears are said to be driving sentiment, thus a signal to go short on the currency pair of focus.

Stop Loss for Sell Entry: Place stop loss above medium-term resistance.

Exit Strategy/Take Profit for Sell Entry

Exit or take profit if the following takes center stage:

  • If the EMA 5 10 34 Crossoverl indicator displays a blue upward pointing arrow while a bearish trend is running, a bullish reversal is said to be looming, thus a trigger to exit or take profit straightaway.
  • If the Elliott_Wave_Oscillator indicator pops up a lime histogram above the 0.00 level while a bearish trend is ongoing, it is a signal to exit or take profit without delay.
  • If the green line of the Relative Vigor Index indicator rises above the 0.00 horizontal level while a bearish trend is running, it is a signal to exit or take profit straightaway.

Sell Trade Example: AUD/NZD (Australian Dollar / New Zealand Dollar), H4 Chart

Fig. 1.1

Free Download

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About The Forex Technical Indicators Used

The EMA 5 10 34 Crossoverl custom Metatrader 4 indicator is a modified exponential moving average indicator that is used to gauge market trends.

The Elliott_Wave_Oscillator is a default 35 period simple moving average (SMA) of prices, displayed as an histogram that fluctuates above and below a zero level.

The Relative Vigor Index is a default Metatrader 4 forex indicator that is deployed in gauging the conviction of a recent price action and the probability that it will carry on.

Easy Installation

Start using this forex strategy in just 5 minutes. Click here to get started now.

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