The reason I use so many is that this is a 4-hour candle strategy, although you can use it for 1 day as well. It only takes a few seconds to look at each one to see stochastics settings forex exchange there is a valid set-up. Over the page is what the chart should look like in Pic1. You can see I’ve added a couple of lines on the stochastic at 30 and 70 as well as the standard 20 and 80.
As I said earlier, I check the charts every 4 hours at 8:00, 12:00, 16:00 and 20:00. If I’m wide awake at midnight, I’ll check them then as well. Look at Examples over the page for along set-up. You will see candles labelled 1, 2, 3 and 4 with ticks and crosses, a tick being valid and a cross being not valid. MACD histogram gets a cross because it’s below the zero line. Stochastics have crossed up so they get a tick.
But we have to wait for all 3 conditions to be good. Now all 3 conditions are met and they get 3 ticks. Entry at open of candle 4 long. If you zoom in a bit you can see I’ve put the entry price at the side, reading 1. This depends on your money management and risk management.
An aggressive entry would see the SL just below candle 3, at the low of the candle less 3 pips. A less aggressive entry would put the SL at the low of candle 2 less 3 pips. Or you can choose the low of candle 1 less 3 pips, or even 3 pips below the last swing low at 2 candles before candle 1. Exactly the same principles but in reverse.
1 and a previous candle that you can see where the trendline comes from. Candle 2 breaks this line downwards and finishes below it. But candle 2 isn’t a setup yet. Candle 3 satisfies all the conditions with price closing below SMA10, stochastics crossed and definitely going down, and MACD below zero.
Entry short is at the open of candle 4 at 1. 4247, giving about 49 pip SL. Again using 1:2 roughly we want 100 pips profit at 1. Using 1:3 then we want 150 or a TP at 1. Looking at previous price action there seems to be plenty of room to get to the 1:2 level TP and also room for the 1:3.
I favour 1:2 level, which it hits without a problem. 10 pips and letting it run. Now a quick look at one that I wouldn’t take even though it meets the 3 criteria. Talks End With China Warning Trade Benefits at Risk if U. Our network of expert financial advisors field questions from our community. Sophisticated content for financial advisors around investment strategies, industry trends, and advisor education. A celebration of the 100 most influential advisors and their contributions to critical conversations on finance.