The high probability 5-minute Forex scalping strategy for the NZD/JPY pair delivers an interesting scalping method that portrays well-defined buying and selling price signal setups.
This makes it easy for users to identify the likely start and end of short-term market trends, ideally for scalping purposes.
The scalping system uses a smart combination of trending tools i.e. the Alligator, TrendLord and Octopus MT4 indicators.
The ultimate goal of this strategy is to ride the prevalent market trend in a manner that ensures almost consistent profits.
MetaTrader4 Indicators: Alligator.ex4 (Parameters Modified; Jaws period=18, Teeth period=13. Lips period=10). TrendLord.ex4 (Inputs Variable Modified; period=80), octopus_2.ex4 (Default Setting)
Preferred Time Frame(s): 1-Minute, 5-Minute, 15-Minute
Recommended Trading Sessions: Any
Currency Pairs: Any pair
Buy Trade Example: NZD/JPY (New Zealand Dollar / Japanese Yen), M5 Chart
Long Entry Rules
Initiate a buy entry if the following indicator or chart pattern gets put on display:
- If the blue line of the Alligator Metatrader 4 forex indicator crosses below the lime and red lines in a bottom up manner as illustrated on Fig. 1.0, the overall market sentiment is said to be bullish, therefore a buy alert is said to be imminent.
- If the steel blue histograms of the TrendLord custom indicator align within the indicator window as seen on Fig. 1.0, bulls are said to be driving price higher i.e. a signal to go long on the stipulated fx pair.
- If the green histograms of the octopus_2 indicator get stacked within its window as shown on Fig. 1.0, price is said to be driven to the upside, as such a buy alert is said to be looming.
Stop Loss for Buy Entry: Place stop loss below short-term support.
Exit Strategy/Take Profit for Buy Entry
Exit or take profit if the following rules or conditions takes precedence:
- If while a bullish trend is runningand the lime line of the Alligator indicator intersects the red line, it suggests that bulls power is said to be weaning, therefore an exit or take profit stance is advised.
- If the TrendLord indicator pops up a crimson histogram during the course of a bullish trend (see Fig. 1.0), it is indicative of diminishing bulls power, therefore an exit or take profit stance is recommended.
- If the octopus_2 forex indicator pops up a red histogram while a bullish trend is ongoing (refer to Fig. 1.0), a bearish reversal is said to be most probable, thus a signal to exit or take profit immediately.
Sell Entry Rules
Enter a sell order if the following holds true:
- If the blue line of the Alligator forex indicator crosses above the lime and red lines in a top downward fashion as depicted on Fig. 1.1, the general market sentiment is said to be bearish, thus a trigger to go short on the forex pair of interest.
- If the crimson histograms of the TrendLord custom indicator align within the indicator window as exemplified on Fig. 1.1, bears are said to be driving price lower i.e. a signal to go short on the designated Forex pair.
- If the red histograms of the octopus_2 indicator get stacked within its window as represented on Fig. 1.1, the market is said to be in favor of downward pressures, as such a sell alert is said to be on the horizon.
Stop Loss for Sell Entry: Place stop loss above short-term resistance.
Exit Strategy/Take Profit for Sell Entry
Exit or take profit if the following takes center stage:
- If while a bearish trend is ongoingand the lime line of the Alligator indicator intersects the red line, it suggests that bears power is said to be halting, therefore an exit or take profit stance will suffice.
- If the TrendLord indicator displays a steel blue histogram while a bearish trend is in focus, more and more bears are said to be closing their positions, thus an exit or take profit stance will do.
- If the octopus_2 forex indicator pops up a green histogram while a bearish trend is running (checkout Fig. 1.1), a bullish reversal is said to be onthe cards, thus a signal to exit or take profit forthwith.
Sell Trade Example: NZD/JPY (New Zealand Dollar / Japanese Yen), M5 Chart
About The Forex Technical Indicators Used
The Alligator is a technical indicator by Bill Williams, introduced in 1995, the indicator is comprised of three lines that are overlaid on the activity chart.
The lines represent the jaw, the teeth and the lips of the Alligator.
Forex traders tend to use this indicator to gauge trend and its likely direction.
The TrendLord custom indicator is a trend tool that comes in a separate window and is configured to a default period of 50.
The Octopus_2 forex trend MT4 indicator is a modification of an earlier version (octopus_1), and forms bars or histograms within its main window.
Green bars are indicative of a buy signal, while red bars indicate a sell signal.
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