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In every trending market, whether the trend is up or down, there are Buy Zones and Sell Zones which are divided by Trend Lines. Understanding the Buy and Sell Zones will lead to profitable trades.Let us take a look at the example below:The chart above represents the 4 hour of the EUR/AUD which has been in an uptrend. Above the Trend Line is the Buy Zone and below the Trend Line is the Sell Zone of the Uptrend. On the break of the Trend Line; it does not mean it is the end of the Trend; the market may be testing support levels with the Uptrend still in place, creating a pattern of consolidation or a new trading channel.Trend Lines are also support and resistance levels. They are powerful tools to successful trading. I am aware that everyone has their own style of drawing Trend Lines; whatever your preference the same principles and trading rules apply.You may now ask " So what happens when the market is within the Sell Zone of an Uptrend ?"There are a number of scenarios that could be taking place:. It could be a counter trend trade or retracement testing levels of support.. The market is exhausted from a huge run and is creating consolidation between support and resistance levels..…
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Vasyl avatar
Vasyl 15 July

I think it is well applied to GBP/JPY, not sure about EUR/USD though

alltrade avatar
alltrade 16 July

I personally don't rely on trendlines because I think I'm not very good with them but it must be said that this is a very good explanation for anybody wishing to learn to trade with trendlines; plenty of chart-examples makes it very informative. Very well written & presented :)

Nadin5794 avatar
Nadin5794 17 Aug.

замечательная статья,именно благодаря старой школе и учителям-трейдерам старой школы я научиласть видеть перспективу в рыночных колебаниях,спасибо за отличный материал

Ifuga avatar
Ifuga 22 Aug.

Very good article

Grizzly avatar
Grizzly 28 Aug.

nice , great deal!

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Trading the
long-term trends or scalping for small pips at a time are both profitable
strategies that many traders use in the Forex. However, an equally if not more
profitable strategy involves aiming for 120 pips on a regular basis with high
probability setups. These are setups that usually lead to the major breakouts that
we see each week for all currencies and which are easily visible on the 30
Minute Charts. When these are combined with Stop Losses of just 40 pips on each
trade, you end up with a wide 3:1 Reward Ratio that provides a large cushion
for your losses as your profits roll in quickly.
The key to this
strategy is that you identify setups that indicate that the market is set for a
sharp or large breakout in the direction of the weekly trend. In most cases, the 30 Minute Chart will provide
Pennants and Ranges which when broken, will lead to the breakouts that you see
taking place on the Daily Charts each week. These setups start as well as continue each weekly trend until the weekly range of  300- 400 Pips is hit  for the most liquid, popular
currency pairs. However, this strategy only requires you to take 120 Pips on each trade within the trend on o…
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MrSami avatar
MrSami 7 Apr.

Trend-line break may be a good alternative for entry in opposite direction. however, prices may go in the direction of the previous trend, sticking to the old trend-line... That's where this approach fails..

ante777 avatar
ante777 7 Apr.

Great article.Thank you for sharing it with us.

lazarojr avatar
lazarojr 10 Apr.

Good article...

DaddyPapi avatar
DaddyPapi 10 Apr.

Thanks for comments..Mr.Sami I agree there is always a risk that it resumes the original trend. but if this trend line break on the smaller chart is taking place in the direction of the larger trend on the Daily Chart, it has a greater chance of success.

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After years of fiddling around with various trading strategies that have only made my beloved brokers richer and me poorer, I believe that I have found the approach that can generate large and consistent monthly returns. Instead of battling the market’s daily volatility, Weekly Range trading appears to be the best bet to achieving realistic monetary targets when several other factors are considered. The key is to find the setups that give the highest probability of success and to risk more than the conventional 2% to 5%. After showing you the benefits and drawbacks of previous Daily and Weekly strategies, I´ll show you the one that can generate 800% with only 4 trades. (Not recommended for the novice trader). Even if you do not trade with my setups, you can still apply it to your trading as long you trade the Weekly Ranges. DAY TRADING STRATEGIES  STRATEGY 1The first approach to day trading involved the following trade setup. Waiting for the Daily Chart’s Candlestick Formation Waiting for the 4 Hour Chart to respond to that signal Trading the 30 Minute signal that followed Aiming for the next major target to be hit during the day  This approach was used when I d…
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eddy avatar
eddy 30 Aug.

Best of luck! :-). I have actually been contemplating a similar trading strategy with a 4 hr chart. However, the difference is that I am testing mine using MACD and STOCHASTICS. The essence is to establish the 'overbought' and 'oversold' regions. The biggest obstacle so far is establishing the most optimal point to enter a trade. I am delighted to here that such a strategy can be this successful when well timed. You have truly inspired me. All the best with your article.

DaddyPapi avatar
DaddyPapi 30 Aug.

Thanks hit the nail on the head..finding optimal point is key..the entries that I use are correct 90-95% of the time..thats why I feel comfortable with this risk...but it only came after a lot of analysis, trial and error and getting used to it at lower risk levels for the last 3-4 months..good luck with the MACD and STOCHS...I never had much luck with them, but I didnt spend much time with them

LinnuxFX avatar
LinnuxFX 31 Aug.

Good article, for best visualization need some images, 800% return, it is the holly gral ... +1 :)

jaggedline avatar
jaggedline 21 Sep.

Great article. I too have just started to test a trading strategy using a high reward low risk (UK100, SP500, don't like forex). Minimum of 4:1 ideally 6:1. 5% of account risked per trade. I simply find the good potential trades that may happen if a price gets too a certain point put in an Entry Order (FXCM) with stops / limits and if its triggered I let it do its thing. I don't get involved because I'm superb at wrecking a good trade when I do. 30min / 1hr/ 4hr / Daily, always with the trend.

Would love to see your results.

JamesWiller avatar

I is quite interesting indeed. I am coming from Daytrading and never realized the 4H Entry Signal but its obvisouly true. At the moment I test Alfa Scalping to get it more automated. Here are many Daytrading strategies combined. THX James

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