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USDJPY 1H Bearish Pennant Short TradeWhat are Pennant Patterns? Flag and Pennants meaning Pennant patterns form after a strong price movement. This is because after a strong upward or downward movement the buyers or the sellers take a break and battle for a short period before the trend eventually breaks out and continues the primary trend. Step #1 Apply Parabolic SAR indicator to the chart. The Parabolic SAR indicator will show you where the main trend is heading. Check out our Parabolic SAR strategy here if you want to specifically trade with this indicator. With this strategy, we have this on the chart to help us make a great trading decision when it comes time to make an entry/exit the trade. Step #2 Find a Strong Bullish, Bearish Trend Most likely you will see this occur with 2-5 strong consecutive bullish or bearish candles. There are no Retracement candles; these should be unsustainable upward or downward candles. Notice that the parabolic SAR dots are above the candles, which is an indication that the trend is pushing down. If the dots are below the candles, the trend is going up, if they are above the candles the trend is going down. Step #3 Analyze Consolidation After Big Price Move. After a large pip downward move you see that many sellers got out of this trade and took their profit. Now what is most likely to occur is that there will be a short battle between the buyers and sellers at this point before a new wave of sellers will take over and drive the price down again! You want to be one of those sellers, and that is why having a strategy like this is so important to have. Some see that move and have no idea what happened and where they should enter if the trend will continue. But you will not be one of them after you learn this strategy. Step #4 Draw Pennant that is Forming. #1- Draw a line on the Strong Bearish candles that formed #2, #3- Draw a line on the higher lows and lower highs (If you down know what these are tap here and I go into detail about this in our Breakout triangle strategy) Once you do this, you are now prepared to find an entry if it breakout out of this pennant. Step #5 The Breakout. Ah yes… The best part of this strategy is seeing that price breakout of the pennant you drew on the chart. **Note Since this is a Bearish Pennant the price will need to breakout of the bottom of the pennant. If this were a Bullish Pennant, you would have needed to see the price breakout above. If the price breaks above the pennant, I would not enter a trade based off of the rules of this strategy. However, there are strategies you can use to trade this but for the PPG trade strategy if the prices break above the pennant in a bearish pennant then avoid trading. The same goes for a bullish pennant. If it breaks below the pennant, then do no take the trade. After Breakout, Make The Trade with this Pennant Forex Strategy. #1 Enter on breakout candle close. #2 So once the price breaks out of the pennant, you are technically safe to make a trade if it’s a strong breakout candle. This is a great place to trade because if the trend continues you are in a great place to be! Note** (This is the advanced entry position) The reason is that this is advanced is that it takes more of a price action analysis that beginner traders may not know what to be looking for. #3 Another place you could make your entry is when the price breaks the top of the pennant. (For beginner traders I recommend this entry position) All you do is draw a horizontal line at the bottom of the pennant, and once the price action breaks this you make a sell entry: Step 6 To place you stop loss, determine a support/resistance area and place in below this in a buy trade or above this area in a sell trade. Step 7 The price should move rapidly, and you should be in profit in a short period. The rule of thumb with these pennant patterns that the second breakout will move as far as the first. The first bullish trend, as you recall me saying, moved 78 pips in 3 hours. So we technically could shoot for another 78 pip move. Always be mindful of price action when you are in a trade, though. Personally, I stay in a trade with this strategy until I see price action consolidating by analyzing Parabolic SAR and studying the price movement. That is what’s nice about the Parabolic SAR. When you see something like that (5 consecutive dots), you can have a good idea as to what the trend may do shortly. If you spot this occurring and you see price action consolidating then consider a trailing stop, or exiting the trade altogether. Today we want to take a look at a great pennant forex trading strategy. You will learn what a bullish pennant and what a bearish pennant is and how to make a pennant flag. This strategy similar to our breakout triangle strategy we have developed a while back, but only this strategy trades distinct flag pattern technical analysis. You see above that the “pole” if you want to call it that had a strong upward movement (nearly verticle). The buyers then began to close their positions and made the trend stall and form what’s called a pennant pattern. Some sellers got in before new buyers made entries and eventually kept the main trend going to the upside. This is essentially what happens every time a pennant pattern is formed. There are two types of pennants that form on charts: 1. Bearish Pennant= This bearish flag is formed after there is a strong downtrend (nearly verticle). The sellers close their positions to and take the profit. This consolidation will then lead to other sellers getting on board and, hence, the price will again be pushed down. 2. Bullish Pennant= This bullish flag formed after there is a strong uptrend (nearly verticle). The buyers close their positions to and take the profit. This consolidation will then lead to other buyers getting on board and, hence, the price will again be pushed up. Once the price breaks either of these “pennants”, you most likely want to get on board and trade these because the price is ready to take off and continue the main trend due to all the sellers/ buyers getting in at the same time. We discussed this in our other article that talks about traders making trading decisions at certain places on the charts. Think about it, everyone is looking at the same charts and are seeing the same thing. When a breakout occurs, everyone sees this happen and makes a trade decision. Also, read about Scaling in and Scaling out in Forex. The PPG trading strategy uses a few elements to help you determine a trade entry: Parabolic Sar Indicator Lines Drawn By You Price Action Analysis You can trade this strategy on any time frame. I prefer trading this on 30 min time frames and up but this still can work on 1m-15 minute charts.
Short
by Tradingstrategyguides
2
EURUSD 1H RENKO CHART STRATEGY #2The second simple Renko Trading Strategy system is an indicator based strategy that uses price-momentum divergence to identify trend reversals. Renko Trading Strategy #2 For this Renko trading strategy, we only need to use the RSI indicator. We can use a 14- period or a 20-period RSI indicator. So, use the same period as the ATR 14 or 20 Renko brick size. After we spot the momentum divergence an entry signal is triggered once we get a reversal. On the Renko chart, a trend reversal is set in motion once the brick changes color. In this case, when we spot a bearish divergence, enter a short position after the brick turns red. For bullish divergence, wait for the brick to turn green. We exit our profitable trade once another reversal pattern is formed in the opposite direction of our trade. As a method to protect our account balance and not lose too much, you can place your SL above and below the swing point developed after your entry. A lot of the noise inherent in regular time-based charts are eradicated. So, if you trade with Renko charts, spotting divergence and trend reversals are a lot easier. The RSI is the best indicator to use with Renko. Read the previous Renko Chart post to learn about Renko chart system.
Education
by Tradingstrategyguides
1
EURUSD 1H RENKO CHARTRenko Trading Strategy #1 This profitable Renko strategy you can use is to focus only on the bricks. No additional technical tool is required for this system. We’re going to explore a very simple and yet very powerful Renko chart pattern that incorporates the wicks. This Renko price pattern looks for two consecutive bricks of the same color and both bricks have wicks. The location of this Renko pattern doesn’t really matter. It can be at the end or middle of a trend. This pattern has a very high rate of success if traded in the right context. You have to look around these two brick patterns and make sure the blocks are not moving back and forth within a trading range. If that’s not the case, then you have a green light to take the signal generated by this trade setup. The entry is on the third brick after the two bricks that have wicks. The stop loss can be placed above the wicks and exit once a reversal pattern is produced. Conclusion – Renko Trading Strategy Renko bars ensure that you have a cleaner and neater representation of price action. If you’re having a hard time reading the price on a candlestick chart, maybe it’s time to look in another direction. Trading with our profitable Renko strategy can be the perfect fit for you. We truly believe that Forex Renko charts are more suitable for traders who still struggle to analyze a candlestick chart. The Renko trading strategies presented through this trading guide are just an introduction into the world of Renko bricks. We hope you now have a clear idea of what the possibilities are by using this new charting technique. When you’re actively trading the markets (scalping, day trading) it’s important to have a methodology to clear out the market noise. The Renko trading strategy is time-independent and gives you an eccentric way to view price action. Even though the free Renko charts can be used across different asset classes, including cryptocurrencies our simple Renko system is designed, but not limited, to be used in the Forex market. What are Renko Charts? A Renko chart is a technical tool or a type of chart that is built by only using price data. Unlike the Japanese candlestick charts, which are built using price, time and volume, the Renko chart only measures price movement. Renko has no time dimension. Renko charts are not some long-hidden secrets dating back to feudal Japan times as some trading gurus would like you to believe. Renko bars were actually developed several decades ago. The name Renko means brick in Japanese and comes from the word “renga.” These charts are sometimes referred to as brick charts by traders. Steve Nison who is the father of modern candlestick charting is the man who actually made Renko charts forex known to the general public. These charts are often compared to traditional candlesticks but have some key differences. While candlestick charts have varying lengths of “wicks” throughout, Renko bricks are all the same size. The simplified bricks found in Renko charts make it easier to read the market and make quick decisions. These charts are ideal for day traders, though they can be used by traders using any timeframe. By removing the noisier parts of the candlestick chart that apply to longer-term trading strategies, Renko charts make it possible to determine where the market is actually moving. Every candlestick on the Renko chart is called a brick because it has the shape of a building brick. The rectangular bricks used for building walls are about the same size. The same goes with Renko charts; every brick is the same size. The size of a Renko brick is pre-determined by the user. How to Read and Build a Renko Trading Chart Reading a Renko chart is simple. Because the bricks have a fixed size, they can all easily be compared to one another. The color (and direction) of the Renko brick will change once the value of the previous brick has been exceeded. This indicates to traders that trends are changing and that the price is likely to swing in the opposite direction. Each brick represents a price range (example – $0.25). However, while the bricks are evenly sized within the same graph, they can be adjusted to your trading objectives. Individuals opening and holding longer, high-cap positions will use different brick sizes than penny stock day traders. We recommend using the average true range—or, ATR for short—in order to construct each brick. The ATR is derived from the closing price of the stock. This means that a Renko chart is a lagging indicator. In the next step, we will show you how to read Renko bars. Note #1: if you use Renko bars with wicks or tails, then some bricks may display additional wicks either at the top or the bottom of a brick. But the brick size remains the same. On the Tradingview charting platform you can go to Chart Settings – Style – Wick, and select which way you want the bricks to be displayed, with or without wicks. Before returning to the Renko bricks with wicks, let’s give you the basics or the foundation of a Renko brick. We already established that the brick size is pre-determined by the user. If you’re trading with Renko charts, and your preferred brick size is 20 pips, then bricks only form when price moved either up or down by 20 pips. The best way to illustrate this concept is to look at Renko blocks through the eyes of the candlestick charts. In the EUR/USD 5-minute candlestick chart below, we highlighted areas of 20 pips worth of price movement. A green Renko brick would form only after the price will advance 20 pips. Conversely, a red Renko brick would form only after the price declines 20 pips. As you can tell, the time intervals between each brick are inconsistent. It’s clear that Renko is less noisy and cuts through a lot of the noise between the swing low and swing highs. Important note: When you trade with Renko charts, the price needs to travel double the price distance of your brick size in order for the Renko brick to change color. For example, if the brick size remains 20, it means that we need to actually move 40 pips for a red brick to be printed after we had a green brick. Let’s return for a second to why some blocks have wicks? Trading Renko charts with wicks can be a very powerful tool in your trading arsenal. Bricks with wicks give us further clues on the battle between the bulls and the bears. A wick is printed on a Renko brick only when there is a strong attempt to produce a reversal (a change of brick’s color from green to red and vice versa), but it fails. The wick will simply show you how many pips it went in the opposite direction. Note #3: a wick is printed on a brick only when the price moves in the opposite direction of the previous candle by at least the length of the brick size +1. Let’s see how you can optimize the Renko block, and how to choose the right Renko brick size. How to choose the right Renko Brick Size? If you don’t know what the right size for Renko charts is then, we have a solution. If we want a dynamic reading of the price through the Renko blocks, we can use a brick size that is determined by the ATR (Average True Range). Instead of picking a random brick size, this will give you dynamic support and resistance levels that are more accurate. The ATR will automatically detect the right brick size that is more in tune with the price action. Note #4: The disadvantage of using an ATR based Renko chart size is that when the ATR value changes, your Renko bricks are redrawn again to reflect the new changes. When selecting your Renko brick size, ask yourself the following questions: What are my objectives as a trader? What are my time constraints? What is the cost of trading? Am I opening small positions or larger positions? Do I consider myself risk-tolerant or risk-averse? If you are pursuing large, lower-risk positions over longer periods of time, then it will make sense to use a larger Renko brick size. On the other hand, if you are pursuing high-risk positions that require paying close attention to volatility, then smaller bricks will be better.
Education
by Tradingstrategyguides
2
EURUSD 1D/4H/1H PARABOLIC SAR SHORT TRADE SETUPRule #1- Apply Parabolic SAR system and Moving Average indicators to chart. You can choose different colors for the moving averages. The 20 period moving average is Blue and the 40-period moving average is Red in this example. Rule #2- The Parabolic SAR Indicator must change to be above price candle. Notice how the dots were below the price. The parabolic stop and reversal (SAR) formula showed us that the price stalled out for a few hours and then the dot appeared above the candle. This is a sign that a reversal may be forming. Rule #3- Another element that must occur is the moving averages must cross over. In a short trade, the 20 period moving average will cross and go below the 40 periods moving average. So now the 20 period moving average is below the 40 period moving average. However, something occurred that is notable. The dot may appear below the price candle. Since the moving averages are telling us that a downtrend is most likely going to occur, we will wait until the dot appears again above the price candle to validate this reversal and enter a trade. Rule #4- Parabolic SAR dot must be above price candle AND moving averages cross to where 20 period MA is below 40 period MA. Note** One of these elements may occur before the other. The reversal dot can appear before the MA lines cross. Or the Moving averages can cross before the reversal candle. As long as there are both elements, the entry criteria are met. Rule #5- Enter The Next Price Candle… Enter (SELL) the very next price candle after the dot appears above the candle. You can see on our chart where we entered the trade. Waiting for one candle after makes sense because this proves to us that this reversal is strong. The moving averages are supporting the downtrend + the dot is signifying a downtrend. Rule #6- Stop loss / Take Profit The stop loss you will place 30-50 pips away from your entry. Always look for prior resistance or support to determine a stop loss. In our example, a stop loss was placed 40 pips from entry. Your exit criteria are when the 20 and 40-period lines cross over again. OR when the dot reverses appears at the bottom of the candle. Some will get out of the trade when the dot appears below the price candle. So basically you can use either exit strategy. This trade the downtrend was very strong so we stayed in until the MA lines cross. Determine where you are in a trade. If you are up +100 pips and the dot changes to reversal consider getting out then and taking your profit. Rules for Long Entry. Rule #1- Apply indicators to chart Rule #2- Dot must change to be below price candle. This is a sign that a reversal may be happening. Rule #3– Another element that must occur is the moving averages must cross over. In a long trade, the 40 period moving average will cross and go below the 20 period moving average. Rule #4- Dot must be below price candle AND moving averages cross to where 20 period MA is above 40 period MA. Note** One of these elements may occur before the other. The reversal dot can appear before the MA lines cross. Or the Moving averages can cross before the reversal candle. As long as we have both elements the entry criteria is met. Rule #5- Enter Next Price Candle. Enter the very next price candle after the dot appears below candle + MA lines cross and 20 period MA is above 40 period. Rule #6- Stop loss / Take Profit The stop loss you will place 30-50 pips away from your entry. Always look for prior resistance or support to determine a stop loss. Your exit criteria in the example below were when the dot appeared above the candle. Note** Scalpers should not be using a 30 to 50 pip stop with this strategy. Consider your rules and adjust accordingly. A 5-10 pip stop may be more appropriate on that low of a time frame. If you like this strategy and have a stop you think works best, leave us a comment below and tell us what you think! Conclusion As stated the Moving Average Trading Strategy can be used on any time frame. However, you should always check different time frames and look at what the market is currently doing. No strategy can give you a 100% win ratio so always be placing your stops at the appropriate areas. I would recommend practicing making both short and long trades with this moving average trading strategy. Reversal Trading Strategy In this article, you are going to read about a trading strategy that teaches you how to use a parabolic SAR indicator (Stop And Reversal) trading tool, along with two moving average trading strategies to catch new trends on the reversal. This moving average and Parabolic SAR trading strategy will show you how to use the parabolic SAR indicator effectively and how you can add this trading system into your daily trading techniques. The Parabolic SAR (PSAR) is an indicator favored by technical traders that captures reversal signals. The Parabolic SAR (Stop and Reverse) was developed by J. Wells Wilder. Wilder was a mechanical engineer best known for his technical analysis developments. He has also developed the DMI (Directional Movement Index), the RSI (Relative Strength Index), and other indicators dear to technical analysts today. Hopefully, by the end of the article, you will have the right parabolic trend formula, learn what a crossover is, find out buy signals, the best moving average crossover for swing trading, best moving average crossover for day trading, and the best moving average crossover for scalpers. Also, read the hidden secrets of moving average. The strategy is a dynamic trading tool that is used by many professional traders of every market (Forex, Stocks, Options, Futures). It is best used when the market is trending. If the market is choppy, the market is moving sideways, this tool does not particularly work at its best. This was developed by Welles Wilder when he introduced this into his book in 1978 that was titled, “New Concepts in Technical Trading Systems.” What this tool basically does is helps traders determine when the current trend will end, or when it is about to end. The way it shows you this is by placing dots that show up above or below the price candle. They appear above or below the current candle for a specific reason. If the dot is above the candle it will be a SELL signal or downtrend. However, if the dot is below the candle this can be a signal to BUY or an uptrend. When the change occurs (the dot goes from below to above the next candle) this indicates a potential price reversal may be happening. Some may think why not just trade the dots. When it reverses, just make an entry at that price. Technically you can trade like this and may win some, but this is a very risky way to trade this indicator. You need other tools to validate this potential trend. Which is why we use this indicator and two moving averages to determine an entry point. The moving average trading strategy will help verify that a reversal is in fact occurring. The combination of these indicators will give you accurate trend reversal setups. This strategy can be used on any time frame on your chart. So day traders, swing traders, and scalpers are all welcome to use this type of strategy. Here are the indicators you need to apply on your chart to use this trading strategy: Parabolic Sar strategy: Default Settings 40 Length Moving Average= Green color in our example 20 Length Moving Average= Red color in our example
Short
by Tradingstrategyguides
1
GBPJPY 1H BEST ATR FOREX TRADING STRATEGY #3QUESTION - WHAT ARE THE BEST FOREX TRADING STRATEGIES. #3 - BEST AVERAGE TRUE RANGE FOREX TRADING STRATEGY Step #1: Make Sure Your Chart Setup Configuration Looks the Same as our Price Chart The Average True Range Trading strategy has a chart configuration with two windows: The first window should contain your favorite currency pair. The second window should contain the ATR indicator with the 20-EMA attached to it (use the above instructions in order to overlay the 20-EMA). Step #2: Wait for ATR Indicator to Break Above 20-EMA A breakout in the ATR indicator reading above the 20-EMA is indicative of higher volatility to come. With higher volatility, this also means trading opportunities and bigger profits to be made. A break of the ATR line above the 20-EMA can be a great proof of a new trend. The Average True Range Trading strategy incorporates not just the ATR volatility readings, but it also looks at the price action to confirm the increase in the ATR volatility. This brings us to the next step of the best average true range Forex strategy. Step #3: Check the Price Chart to Ensure the ATR Breakout is Followed by a Price Breakout After the ATR line broke above the 20-EMA we want this to be followed by a break in price as well. If we’re looking to buy, we want to see a big bullish candle relative to the previous candles popping up on the chart. If the price breaks up and is accompanied by a break higher in volatility, there is a high probability of the market to move in the same direction. Now, all we need to establish is how to enter the trade. If we already have an idea of where the market is most likely to move. This brings us to the next step. Step #4: Enter Long Once We Break Above the High of the Breakout Candle Depending on your preferred time frame, you’ll have to wait until the breakout candle has been developed. Then enter long once the next candle breaks above the high of the breakout candle. This is key to the success of the Average True Range Trading strategy. You need a big bold candle to confirm the ATR breakout. You’ll learn soon that the ATR indicator will break many times above the 20-EMA. But it won’t be confirmed by the price action in which case you don’t want to execute any trades. The ATR indicator is a great tool to use when it comes to establishing profit targets. This brings us to the next step of our Average True Range Trading strategy. Step #5: Your Take Profit Target Should Be Equal to the ATR Indicator Value The ATR indicator can be of great help to determine your take profit target. This is self-explanatory because if you know how much, on average, the market is prone to move, we want to conform to this reality and have that as a target. In our case, we can see the ATR volatility reading has a value of 26 pips. This means our profit target should be calculated 26 pips above the high of the breakout candle. The breakout candle high is at 1.3213 and adding 26 pips to that price we end up with a profit target at 1.3240. Add 26 pips for each TP 2, 3 & 4. Step #6: Place the Stop Loss below the Breakout Candle Low In trading, you have to learn to always protect your back and hide your protective stop loss at the most logical point. A break below the breakout candle low will invalidate our trade idea. This is the place where we want to hide our protective stop loss. Note** The above was an example of a buy trade. Use the same rules – but with the only difference that you need a bearish breakout candle – for a sell trade. Conclusion The Average True Range Trading strategy provides you with an unorthodox approach to trading. It combines both the market volatility and the price action to provide us with the best trades possible. We hope that by now you’re sold out to the power of the ATR indicator’s ability to forecast the market with a high degree of accuracy.
Long
by Tradingstrategyguides
3
1ST - MACD TREND FOLLOWING STRATEGYQUESTION - WHAT ARE THE BEST FOREX TRADING STRATEGIES? 1ST - MACD TREND FOLLOWING STRATEGY Step #1: Wait for the MACD lines to develop a higher high followed by a lower high swing point. This is an unorthodox approach to technical analysis. But, we at Trading Strategy Guides.com are different. We don’t mind doing uncomfortable things if that’s what it takes to succeed in this business. First, let’s visualize how an authentic swing point really looks on the MACD indicator: The first rule of thumb to recognize a swing high on the MACD indicator is to look at the price chart if the respective currency pair is doing a swing high the same as the MACD indicator does. A higher high is the highest swing price point on a chart and must be higher than all previous swing high points. While a lower high happens when the swing point is lower than the previous swing high point. Step #2: Connect the MACD line swing points that you have identified in Step #1 with a trendline. At this point, we really ignored the MACD histogram because much of the information contained by the histogram is already showing up by the moving averages. Look at the price action now and compare it to our MACD trendline we drew early. We can clearly notice that the MACD contains the price action much better and reflects the trend much clear. But, at this point, we’re still not done with the MACD indicator, which brings us to the critical part of our MACD Trend Following Strategy. Step #3: Wait for the MACD line to break above the trendline. (Entry at the market price as soon as the MACD line breaks above). When the MACD line (the blue line) crosses the signal line (the orange line) it’s an early signal that a bullish trend might start. However, if trading would be that easy we would all be millionaires, right? And that’s the reason why our MACD Trend Following Strategy is so unique. We’re not only waiting for the MACD moving averages to cross over but we also have our other criteria for the price action to break aka the trend line we drew early. This is a clever way to filter out the false MACD signals, but you have to be equipped with the right mindset and have patience until all the piece of the puzzle come together. If you were to trade just based on the MACD crossover over time you’ll lose money because that’s not a reliable strategy. But if you use the MACD indicator along with other criteria such what this strategy tells you to do, you will find great trade entries on a consistent basis. Step #4: Use Protective Stop Loss Order. (Place the SL below the most recent swing low). Now, that you already know how to enter a trade at this point you have to learn how to manage risk and where to place the SL. After all, a trader is basically a risk manager. You want to place your stop loss below the most recent low, like in the figure below. But make sure you add a buffer of 5-10 pips away from the low, to protect yourself from possible false breakouts. Did you notice? The MACD Trend Following Strategy triggered the buy signal right at the start of a new trend and what is most important the timing is more than perfection. We bought EUR/USD the same day the bullish divergence trend started. Now, what this has to do with the SL? Basically, a good entry price means a smaller stop loss and ultimately it means you’ll lose a lot less comparing it with the profit potential, so a positive risk to reward ratio. Step #5: Take Profit when the MACD crossover happens in the opposite direction of our entry. Knowing when to take profit is as important as knowing when to enter a trade. However, we want to make sure we don’t use the same trading technique as for our entry order. When the MACD line (the blue line) produces signal line crossovers (the orange line) we want to close the position and take full profits. Before taking profits, it’s important to wait for the candle close – either the 4h or the daily candle – depending on the time frame you trade so you make sure the MACD crossover actually happens. Note** The above was an example of a buy trade using the MACD Trend Following Strategy. Use the exact same rules – but in reverse – for a sell trade. Conclusion: The MACD Trend Following Strategy is a very simple trend following strategy and yet a very profitable strategy at the same time. As the saying goes, “The trend is your friend” and no matter if you’re just starting as a Forex trader or you’re already an established trader life is much easier when trading in the direction of the line of least resistance rather than fighting the trend which is a loser’s game. The success behind the MACD Trend Following Strategy is derived from one simple principle: momentum precedes price.
Education
by Tradingstrategyguides
3
EURJPY 1H SCHIFF PITCHFORK LONG TRADING STRATEGYThe Andrews Pitchfork Trading Strategy Our team at Trading Strategy Guides likes to use the Pitchfork trading system to identify a change in market behavior and make a profit from it. It’s important to understand what Andrews Pitchfork is and what pivots to use. This will give us more confidence later when taking the trades based on the Pitchfork trading system. Moving forward, we present the buy-side rules of the Andrews Pitchfork trading Indicator. Step #1: Identify the Three Pivot Points necessary to Draw the Pitchfork lines. The first thing you need to establish for the Pitchfork trading system is to identify three pivot points necessary to draw the Pitchfork lines. For more insights into this topic, check out the what is Andrews Pitchfork section. Since we’re looking for buying opportunities, we need to identify a series of rising pivot points. Step #2: Apply the Pitchfork indicator starting from Pivot 1 and move through Pivot 2 and Pivot 3. Now, use the three pivots identified and draw the Pitchfork trading system lines by connecting the pivots together. Start from Pivot 1 and move forward through Pivot 2 and Pivot 3. During this stage, you’ll be plotting the Pitchfork trading system lines. This will map the most important dynamic support and resistance levels. Once you’ve done this correctly you will see a rectangle or pitchfork formed. Step #3: Buy at the market at the first retest of the lower Pitchfork support trendline. With the Andrews Pitchfork trading strategy, the price should be contained inside the Pitchfork parallel channel. In this regard, if we’re looking for buying opportunities, assume the lower Pitchfork support trendline to hold the price for a bounce. We recommend buying when the lower Pitchfork support trendline is tested. The next logical thing we need to establish for the Andrews Pitchfork trading strategy is where to take profits. Step #4: Take Partial Profit at the Median Line, and Take Profit 2 at the upper Pitchfork Resistance trendline. The Pitchfork trading system gives you the flexibility to manage your trades in many different ways. Our mantra is, “Keep it Simple, Stupid.” In this regard, since the core principle of the Andrews Pitchfork trendline is that price tends to gravitate towards the median line, it’s the logical place to take some profits off the table. We only take partial profits on the median line because we also want to maximize our profits. This will give the market a chance to retest the upper Pitchfork resistance trendline. With the Andrews Pitchfork trading system, we’re trading in the direction of the trend. So, the expectation is to see the price moving higher and eventually retest the upper Pitchfork limits. Note: After TP1 was reached, move your SL at BE. We accomplish two things by doing this. First, we make sure that we accumulate profits. And secondly, if the markets reverse, make sure you stopped at BE and don’t lose any money. The next important thing we need to establish is where to place your protective stop loss. Step #5: Place the Stop Loss below the lower Pitchfork trendline and add a buffer of 20-30 pips. The recommended place to hide our protective stop loss is by adding a buffer of 20 – 30 pips below the lower Pitchfork trendline. Normally, in an uptrend, the support Pitchfork trendline should hold the price above. However, in order to protect ourselves from possible false breakouts, we’ve added a buffer of around 20-30 pips to our protective stop loss. Note* In a strong uptrend, it’s quite normal for the price to break and trade above the resistance Pitchfork trendline. Inversely, in a strong downtrend, it’s quite normal for the price to break and trade below the support Pitchfork trendline. Andrews Pitchfork Trading Strategy Conclusion There are many Andrews Pitchfork trading strategies that can be built around the Pitchfork trading system lines. They can all be simply derived from the Pitchfork’s trading rules. In order to use this system, you need to understand what Andrews Pitchfork is. You can also read our best short-term trading strategy. Andrews Pitchfork is simple to understand because, according to the Pitchfork trading system principles, you only need to know these three rules: Price tends to gravitate towards the median line. When price breaks the median line there is a high chance it will pull back to retest again the median line. When price breaks the Pitchfork channel on the opposite side of the channel direction, there is a shift in market sentiment and the trend can reverse.
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by Tradingstrategyguides
LTCUSD 1H CAMARILLA MEAN REVERSAL STRATEGYNow, we know that this Camarilla pivot trading strategy tends to produce less trading signals. This means that you won’t be having a trade signal every day. Don’t worry about it because we have one more trick in our sleeves. We can show you a very reliable Camarilla mean reversion strategy. This Camarilla pivot trading strategy only uses the power of divergence along with the pivot points. It sounds complicated, but in practice is quite easy. To simplify the process we’re going to look at buying near Camarilla support S3. All you need to look for the price to make a new low that at the moment we touch the support S3. This means we broker below the most recent intraday swing low. In this particular example, the price broke below the support S3. Many times it will happen this way. So, don’t expect the Camarilla pivot support levels to hold to the pip. This is why we enter our position once the price gets back above the support S3. With this Camarilla pivot trading strategy we place the protective stop loss below the support S4. Note* Use the same rules, but in reverse for selling near the resistance R3.
COINBASE:LTCUSD
by Tradingstrategyguides
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