Post by account_disabled on Mar 9, 2024 5:03:45 GMT -5
Peculiarities of the Forex trend strategy Statistically, markets consolidate 75-80% of the time and risefall 25% of the time. Without a doubt, everything is individual. For example, the S&P 500 has been rising for a few years in a row, while oil traders regularly heat up and cool down. Still, seeing EUR USD's spiritless vacillation inand its rapid collapse in January-February , one begins to think the statistics are correct. Obviously, different market states call for different trading strategies. The principle of "trend is your friend" has been particularly popular this year. Trend hunting has already made a lot of money, but not going too far is also important. The “Fractal Breakout” trading system can help here. It is very efficient when the market is trending, while the ADX indicator can calm those who are trying to catch the last train.
Legendary trader Bill Williams is considered the Mexico Mobile Number List author of the term "fractal." The peak of the center bar in an ascending fractal must be greater than the peaks of the 2 bars before and 2 bars after. The low of the center bar in a descending fractal must be lower than the lows of the 2 bars before and 2 bars after. The author of "Trading Chaos" used the combination of these patterns and the Alligator indicator to build a trading strategy. The “Breakout Fractal” strategy is simpler. EMA-135 (an exponential moving average with the period of 135) replaces Alligator. "Fractal Breakthrough" Strategy on AUD USD Chart LiteFinance: Innovative Fractal: Efficient Forex Strategy Litefinance If the quotes of a currency pair are below EMA-135, the trend is bearish and bearish fractals should be used for short positions. When forming fractals, draw horizontal levels for support. An advance is a signal to sell AUDUSD.
The example shows a 1 hour chart. The smaller the time frame, the more often the signals occur. The most important thing is to filter them correctly. Protective stop orders must be placed above the MA level when placing a trade. The authors of the strategy recommend using a take profit of 115 points and switching to a trailing stop once the quotes have covered 30 points. In my opinion, there cannot be a universal recipe due to different volatilities. Targets can be placed using harmonious trading patterns or other technical analysis tools. What is even more important to understand within the framework of this system is when trades should not be opened. ADX can provide the answer. This indicator is generally used to measure the strength of the trend. If it is near critical areas, it means that the crowd may want to take the last train.