We present you a simple but profitable forex strategy that hides a small risk and has proven results back in time.
Currency Pairs: EURUSD, USDJPY, GBPUSD, EURGBP, EURJPY and all major Forex pairs
Indicators: EMA with period 250, EMA with period 500, and Bollinger Bands with period 40 and deviation 2
Conditions for Buy: We use the moving averages to determine the direction of the trend in this case EMA250 should be above EMA500. Buy entry after a breakout of the Bollinger Bands Bottom Band from the bottom up.
Conditions for Sell: Similarly, here EMA250 should be below EMA500 then the trend according to the strategy is downward. Upon entering the top Bollinger Bands, the upper band is broken down.
Take Profit: 100 TIPS
Stop Loss: 150 taps
IMPORTANT: Move Stop loss to break even after a 20 pip movement in the winning direction.
The test results show a probability of a 20% drawdown with a probable profit of over 100%. Here is very important to choose the level of risk according to the size of your account and the amount of total trading investment you have faced. Given the dynamics of the forex market and the relatively frequent consolidations and sharp movements, the strategy has a good track record of moderate risk. The results below show tests for the EURUSD pair with real tick data for the period from the beginning of 2016 up to mid. 2018.
In conclusion, when implementing the strategy, we must carefully select the financial instrument and if we apply it manually, we can also take into account market sentiment and distribute the position in parts with appropriate Japanese Candlesticks signals, which can improve our results in implementing this strategy on the forex market.
25 Canada Square, Level 33, office 50, Canary Wharf London, E14 5LQ +44 20 3608 6256
World Financial Markets - 0700 17 600 Varchev Exchange - 0700 115 44
Varchev Finance Ltd is registered in the FCA (FINANCIAL CONDUCT AUTHORITY) with a passport in the United Kingdom: FCA, United Kingdom - registration number: 494 045, which allows provision of financial services in the United Kingdom.
Varchev Finance Ltd strictly comply with the statutes of the European directive MiFID (Markets in Financial Instruments). targeting increased efficiency, transparency and uniformity of financial instruments.
Varchev Finance Ltd is authorized and regulated by the Financial Supervision Commission - Sofia, Bulgaria: License number RG-03-02-05 / 15.03.2006
The information on this site is not intended for distribution or use by any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 63,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.