The Heiken Ashi Forex strategy for Metatrader 5 is trend trading strategy which is a variation of the traditional Japanese candlesticks trading strategy.
Unlike Japanese candlesticks, the adoption of Heiken Ashi candlesticks offers a lot of advantages, one of them is its ability to filter out market noise that is present on Japanese candlesticks.
In order to better highlight the market trend in a much easier fashion, we encourage traders to tryout this remarkable strategy.
Another reminder, you can always take advantage of one of the best things that relates to this strategy, which is you can exit your trades just by seeing the Heiken Ashi candlestick color flip.
MetaTrader 5 Indicators: MACD.ex5 (Default Setting), Doteki Heikin Ashi.ex5 [Inputs Variable Modified; Averaging Period for Heikin Ashi (Original=3.0)]
Trade Style: Scalping, day trading, swing trading
Trading Sessions: London | New York | Tokyo
Currency Pairs: Majors, cross pairs, exotics
Platform: Metatrader 5 (MT5)
Buy Trade Example: EURCAD, M30 Chart
Trading Strategy Rules For Buy and Sell Trades Explained
Enter a buy trade if the following trading conditions are met:
- If the silver histograms of the MACD Metatrader 5 forex indicator align above the 0.00 horizontal signal level (see Fig. 1.0), price is said to be pushed to the upside i.e. a trigger to go long on the stipulated currency pair.
- If the lime green bars of the Doteki Heikin Ashi custom indicator pop up on the activity chart as illustrated on Fig. 1.0, the general market sentiment is said to be bullish, therefore a signal to go long on the forex pair of focus.
Suggested Stop Loss for Buy Entry: Place stop loss 3-5 pips below support.
Suggested Exit Strategy/Take Profit for Buy Trade
Exit the buy trade if the following trading conditions are met:
- If while a bullish trend is ongoing, the MACD indicator displays a silver histogram that is aligned below the zero level, bulls are said to be taking a hit, therefore an exit or take profit is recommended.
- If the Doteki Heikin Ashi forex indicator display a fire brick price bar while a bullish trend is running (refer to Fig. 1.0), it is signaling weaning bulls power, as such an exit or take profit will suffice.
Open a sell trade if the following trading conditions are met:
- If the silver histograms of the MACD forex indicator align below the 0.00 horizontal alert level (refer to Fig. 1.1), price is said to be dragged lower i.e. a trigger to go short on the selected currency pair.
- If the fire brick bars of the Doteki Heikin Ashi custom indicator pop up on the activity chart as exemplified on Fig. 1.1, the overall market sentiment is said to be bearish, therefore a signal to go short on the forex pair of interest.
Suggested Stop Loss for Sell Entry: Place stop loss 3-5 pips above resistance.
Suggested Exit Strategy/Take Profit for Sell Entry
Exit the sell trade if the following trading conditions are met:
- If while a bullish trend is ongoing, the MACD indicator displays a silver histogram that is positioned above the zero level, bears are said to be losing out, therefore an exit or take profit is advised.
- If the Doteki Heikin Ashi forex indicator pops up a lime green price bar while a bearish trend is ongoing, it is pointing to diminishing bears power, as such an exit or take profit will do.
Sell Trade Example: EURCAD, M30 Chart
MT5 Trading Indicators Used For This Strategy
Designed by Gerald Appel in 1979, Mac D, as it is fondly called is a common and multipurpose tool deployed in identifying and following strong trends, while also catching trend reversals
The Doteki Heikin Ashi is a charting technique that can be used to read price action, while also forecasting future prices.
Moreover, it’s a technical tool that allows traders modify its period to whatever value one wishes to use.