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Monday, June 21, 2021

Forex Trading Guide 2021: Outside Method Strategy

 FOREX Strategy “Outside Method”

1. The indicator in question is EMA (exponential moving average) with an averaging period of 9.

2. Used timeframe – М15 (15-minute price chart)

3. Currency pair – GBP / USD

To open a trading position, look at Japanese candlesticks and their location relative to the EMA (9):

• The body and shadows of the candlestick do not touch the EMA (9);

• The best option – the upper or lower shadow of the candlestick is at a distance of more than 1 point from the EMA (9);

• The candlestick should close above the previous high in a bullish trend or below in a downtrend.

Position opening rules:

In an uptrend, we open a buy deal at the opening of the next candle, and in a downtrend, we open a sell deal also at the opening of the next candle.

Position closing rules:

• Immediately set stop loss and take profit after opening a trade.

• Limiting losses set at the Low (uptrend in the market) or High (downward trend in the market) of the previous candlestick.

• An order to take profit is placed at a distance equal to the height of the previous Japanese candlestick.

• If the price has gone sharply in your direction and you have a profit of 20 points or more, then we move the position to breakeven (taking into account the spread).

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