At the heart of this forex strategy, “Divert” is the divergence of the MACD indicator and to it filters: indicators Stochastic Oscillator and CCI (Commodity Channel Index). The use of divergence is more reasonable for time periods of not less than H1-hour (but it is better to use 4-hour and daily time intervals).
Good results trading system shows on the currency pair EUR USD and GBPUSD.
For trading on this trading forex strategy, we need 3 indicators:
1. FX5 Divergence – displays the MACD histogram on the chart and visually shows the appearance of a divergence. The parameters of the forex indicator are standard: fastEMA – 12, slowEMA – 26, signal – 9.
2. Stochastic Oscillator – is located in the standard forex trading indicator package for the Metatrader 4 trading terminal. Parameters of the forex indicator: period% K – 8, range% D – 3, slowdown – 3, prices – Low / High, type MA – Simple.
3. CCI is also a standard tool. Parameters: period – 14, apply to – Typical Price (HLC / 3).
Opening of the trading position for the purchase:
1. The appearance of a divergence for the purchase in the indicator window – FX5_Divergence forex indicator draws a green arrow.
2. CCI crosses the “-100” line from the bottom up.
3. Stochastic Oscillator: the signal line% D (3) crosses the main% K (8) from the bottom up (it is desirable that this was in the oversold zone, ie below 20).
Opening of the trading position for sale:
1. The appearance in the window of the divergence indicators for sale – FX5 indicator Divergence draws a red arrow.
2. CCI crosses the “-100” line from top to bottom.
3. Stochastic Oscillator: the signal line% D (3) crosses the main% K (8) from the top down (it is desirable that this was in the overbought zone, ie, above 80).
The safety Stop loss should be set at the extremity of the candle on which you opened the trading position using Trading strategy Diver for forex trading.
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