Day Trading Strategy - Try for yourself, do the back testing!!!
I have decided to share with you all, my day trading strategy for forex. It is a very simple, yet extremely effective strategy.
I use Heikin Ashi candles to smooth out the data, using only the Supply/Demand zones from Hekin Ashi rather than candle sticks.
Here is how it works:
Rules
- Trend. 200 EMA Above 100 EMA = Down Trend, Below = Up Trend
- Use Fresh Supply/Demand Zones (candle spikes during low volume periods are fine, the zone will still be valid)
- Trades taken at the London session, just prior to open, or early session.
- Target the opposing zone to create your R/R, buy use some of your own initiative here.
- Take one trade per day. Usually when currencies are correlating these zones work better, you will see if you do the back testing, these zones seem to align across multiple pairs and you then see some big moves happening all at the same time and you sometimes see 5-10 setups all take off at the same time hitting targets. on the other hand when this strategy goes against you, or the correlation with other pairs goes against the trend, you will find yourself losing, therefore if you have taken 4-5 trade setups, you will get hurt by this.
- Look out for ranging EMA,s if you can clearly see the last couple of days multiple crossovers, stay away. on the other hand, if you get a cross over that could be the start of a range.
- Supply/Demand zone must take out previous zone to be valid.
Entry. You want to wait for price to come back to a zone you have highlighted, and the print the opposing Hikin Ashi candle. for example of a sell trade: we want to see bullish candles enter the zone, then a bearish coloured Hikin Ashi candle is our signal. Note; if the entry candle is too large, of course you want to look for a better setup, as you might not be getting good RR potential.
Enjoy
I use Heikin Ashi candles to smooth out the data, using only the Supply/Demand zones from Hekin Ashi rather than candle sticks.
Here is how it works:
Rules
- Trend. 200 EMA Above 100 EMA = Down Trend, Below = Up Trend
- Use Fresh Supply/Demand Zones (candle spikes during low volume periods are fine, the zone will still be valid)
- Trades taken at the London session, just prior to open, or early session.
- Target the opposing zone to create your R/R, buy use some of your own initiative here.
- Take one trade per day. Usually when currencies are correlating these zones work better, you will see if you do the back testing, these zones seem to align across multiple pairs and you then see some big moves happening all at the same time and you sometimes see 5-10 setups all take off at the same time hitting targets. on the other hand when this strategy goes against you, or the correlation with other pairs goes against the trend, you will find yourself losing, therefore if you have taken 4-5 trade setups, you will get hurt by this.
- Look out for ranging EMA,s if you can clearly see the last couple of days multiple crossovers, stay away. on the other hand, if you get a cross over that could be the start of a range.
- Supply/Demand zone must take out previous zone to be valid.
Entry. You want to wait for price to come back to a zone you have highlighted, and the print the opposing Hikin Ashi candle. for example of a sell trade: we want to see bullish candles enter the zone, then a bearish coloured Hikin Ashi candle is our signal. Note; if the entry candle is too large, of course you want to look for a better setup, as you might not be getting good RR potential.
Enjoy