Hi!
nd here we are again talking about the strategy that withstood the test of time. This Forex trading method is based on the same study of defining support and resistance levels and trading upon the fact of their violation.
A trading setup requires only an open chart and no restrictions for the currency or timing preferences.
Entry rules: Once the price makes it through the “pivot Line” - dotted white line on the figure below (drawn using the latest price peak) - and closes above (for uptrend) or below (for downtrend) the line buy/sell accordingly.
Additions: as an additional tool traders can use MACD (12, 26, 9). The rules for entry then will be next - let’s take a SELL order:
When MACD lines cross downwards, you look for 1-2-3 set-up to form. When the price starts “attacking” the “pivot Line” you check that MACD is still in SELL mode (two lines are heading down). Once the price closes below the “pivot Line” – place Sell order.
http://forex-strategies-revealed.com...strategy13.png
Same chart: MACD (12, 26, 9) is added.
http://forex-strategies-revealed.com...trategy13a.png
Exit rules: However, exit can be found using Fibonacci method .
When applying Fibonacci Expansion to the charts, start with Point 1. Then align FE to touch all 1-2-3 points.
Your profit target will be the 161.8 Fibonacci Expansion level.
Simple and working well!
Below are just some examples:
http://forex-strategies-revealed.com...es/123exit.png
I've also added Stochastic just to show how you can pick tops and bottoms for your 1-2-3 calculation without too much efforts.
Happy trading!!!