SMMA Forex Trading Strategy For Scalping

Unlike most forex scalping systems out there, the SMMA forex trading strategy is a unique trading system designed to yield consistent profits.

The strategy takes advantage of two key indicators i.e. the SMMA-Crossover_Signal.ex4 and the real MACD MT4 indicators.

Chart Setup

MetaTrader4 Indicators: SMMA-Crossover_Signal.ex4 (default setting), realMACD.ex4 (default setting)

Preferred Time Frame(s): 1-Minute, 5-Minutes

Recommended Trading Sessions: Any

Currency Pairs: any

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Buy Trade Example (Click the image for full size)

SMMA-forex-trading-strategy

Fig. 1.0

Strategy

Long Entry Rules

Enter a buy position if the following rules or conditions are in place:

  1. If the green upward pointing arrow of the SMMA-Crossover_Signal.ex4 custom indicator forms below price bars, it is an indication that price is heading north i.e. a buy signal.
  2. If the blue line of the real MACD crosses the red line upwards and subsequent yellow histograms forms above the 0.00 level, it is a signal to buy.

Stop Loss for Buy Entry: Place stop loss ~ 5 – 15 pips below entry price.

Exit Strategy/Take Profit for Buy Entry

Exit or take profit on position(s) if the following conditions or rules are in place:

  1. If a red downward pointing arrow of the SMMA-Crossover_Signal.ex4 custom indicator shows up on the activity chart above price bars, it is an indication of a possible reversal, as such an exit or take profit is appropriate.
  2. If the blue line of the real MACDcrosses the red line downwards, while the yellow histograms diminishes into the 0.00 level, an exit is advised.

Sell Entry Rules

Initiate a sell order if the following is true:

  1. If the SMMA-Crossover_Signal.ex4 custom indicator forms a red downward pointing arrow above price bars, it signifies a bearish trend.
  2. If blue line of the real MACD custom indicator crosses the red line downwards, plus yellow histograms forming below the 0.00 level, it is indicative of a bearish signal.

N.B. Notice that from point in which our first signal was issued based on the strategy, we waited some more before we got signal from the SMMA-Crossover_Signal.ex4 custom indicator.

The rule here is that, as far as the conditions for a sell are being upheld by one indicator, it remains valid for entry pending when the next condition will be met.

Stop Loss for Sell Entry: Place stop loss ~ 5 – 15 pips above entry price.

Exit Strategy/Take Profit for Sell Entry

Exit or take profit on any of the following conditions:

  1. If the SMMA-Crossover_Signal.ex4 custom indicator forms a green upward pointing arrow below price bars, it signals an exit or take profit.
  2. If the blue line of the real MACD custom indicator crosses the red line upwards, in addition to a diminishing of the yellow histograms into the 0.00 level.

SMMA-forex-trading-system

Fig. 1.1

Free Download

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About The Trading Indicators

The SMMA-Crossover_Signal.ex4 indicator is a trend following indicator that is built on the principle of two Simple Moving Averages crossover.

Seemingly, the real MACD indicator is also a trend following indicator designed after the MACD MT4 indicator.

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