How I trade outside bars - Trading Strategy - FMT
A simple trading strategy.
Here we have a stripped back version of my trading strategy.
I simply use outside bars to indicate momentum and turning points in the market.
The first highlighted bar from April 2018 shows an outside bar completely engulfing the previous weeks price action. From here the market moves over 400 pips north.
The second highlighted bar shows a reversal from our previous move up. Again the price action completely engulfs the previous weeks. We could then gain another 400+ pips.
This repeats it self on the the third and forth bar.
We only trade outside bars from the extremities of the Bollinger bands. When entering a trade I place a pending order on a 50% retracement from the high (or low) of the outside bar.
Stops are usually placed just above the high or low of the outside bar.
You won’t catch every pip and your pending order won’t activate on every trade but this is a simple yet powerful trading system which can be used on various time frames. I tend to stick to the daily, weekly and monthly charts.
On the lower time frames (1hr/4hr) I will use the RSI(2) for further clarification on oversold and overbought markets by only trading outside bars if the RSI is above 95 or below 5.
If you have any question feel free to ask.
Here we have a stripped back version of my trading strategy.
I simply use outside bars to indicate momentum and turning points in the market.
The first highlighted bar from April 2018 shows an outside bar completely engulfing the previous weeks price action. From here the market moves over 400 pips north.
The second highlighted bar shows a reversal from our previous move up. Again the price action completely engulfs the previous weeks. We could then gain another 400+ pips.
This repeats it self on the the third and forth bar.
We only trade outside bars from the extremities of the Bollinger bands. When entering a trade I place a pending order on a 50% retracement from the high (or low) of the outside bar.
Stops are usually placed just above the high or low of the outside bar.
You won’t catch every pip and your pending order won’t activate on every trade but this is a simple yet powerful trading system which can be used on various time frames. I tend to stick to the daily, weekly and monthly charts.
On the lower time frames (1hr/4hr) I will use the RSI(2) for further clarification on oversold and overbought markets by only trading outside bars if the RSI is above 95 or below 5.
If you have any question feel free to ask.
