How to use stochastic indicator in forex trading group
But longer timeframes are recommended. Any currency pair and timeframe should work. Previous : The Relative Strength Index. The first ij follows the current price for the currency pair, and the second line treats the price as a moving average. They also help you understand times when the market gains might be waning and when the market might be prepping for a reversal in trend.
It's based on a standard Stochastic Oscillator indicator, which signals a trend fatigue and change. That means that you will almost always enter on pull-backs, guaranteeing rather safe stop-loss levels. Enter Long position when the cyan line crosses the red one from below and both are located in the bottom half of the indicator's window. Enter Short position when the cyan line crosses the red one from above and both are located in the upper half of the indicator's window. Five signals for this strategy can be seen on the example chart above.
All stop-loss levels are marked with the yellow horizontal lines on the chart. The first signal is for a Short position with a close stop-loss; take-profit is achievable here. The second one is a bullish signal, which turns out to be a wrong pull-back, but, fortunately enough, the stop-loss is quite tight here. The third signal is not a signal actually, because it is a bearish figure cross that appears in the lower half of the window and thus is disregarded.
The fourth signal is bullish with a stop-loss quite far away, but even the most aggressive take-profit level would work here. The final signal is for Short, with tight stop-loss and a lot of place for a rather profitable TP setting. Ideally how to use stochastic indicator in forex trading group and bearish signals should follow one after another, but due to the occurrence of the false signals bearish in the lower half and bullish in the upper half of the windowit is not always the case.
Use this strategy at your own risk. It is not recommended to use this strategy on the real account without testing it on demo first. Do you have any suggestions or questions regarding this strategy? You can always discuss Stochastic Oscillator Strategy with the fellow Forex traders on the Trading Systems and Strategies forum. Please disable AdBlock or whitelist EarnForex. Only one standard indicator used.
Take-profit level isn't optimal. Any currency pair and timeframe should work. But longer timeframes are recommended. Set stop-loss to the local maximum if going Long and to the local minimum if going Short. Close position immediately if another signal is generated.
Stochastic Momentum Index Indicator for Safe Trade Entries
How to Use Stochastic Oscillator in Forex. It was one of the first technical indicators used by analysts to provide insight into potential CFD & FOREX TRADING ;. A live Forex trading example video showing how to use the Stochastic Oscillator in Forex. leading indicator for my live Forex trading HLK Group Pty Ltd (ACN. Stochastic indicators are called The Stochastic. The classic stochastic indicator is also a One very important forex trading indicator that is based.