High-Probability Techniques for Trading Forex

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And if traders TRULY wished to capture larger profits, they would use two even LONGER moving averages, the two plotted on the chart below…

So, after a bit more consideration, here is what NPP would propose to replace the Moving Average MACD Combo...

In addition to the yellow SMA (100) and the white SMA (50), it would plot the two (lavender and aqua) longer-term moving averages from the previous post, along with a third (hot pink) longer-term moving average; and then replace the MACD with a histogram reflecting the slope of the hot pink moving average.

Traders would then generally trade in the direction of the slope of the hot pink moving average, and remain on the sidelines when the measure appeared more-or-less neutral, as it does in the third, fourth and fifth sections of the above chart.

 

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So, after a bit more consideration, here is what NPP would propose to replace the Moving Average MACD Combo...

What is the direction of the trend?
The direction of the trend is conveyed by the slope of the hot pink baseline (as confirmed by its positional relationship with the slower aqua [and lavender] moving averages).

Should I get in now or wait for a retracement?
Wait for the red moving average to begin to hook in the direction of the trend after pulling back "behind" the white 50-period SMA and the yellow 100-period SMA (and for confirmation in the form of candlesticks crossing back over the green moving average).

When does the trend end?
The trend ends when the hot pink baseline turns around and starts heading in the opposite direction (as confirmed by its positional relationship with the slower aqua [and lavender] moving averages).

 

[maxinger]

BBC / BLOOMBERG INTERVIEW WITH THE RENOWNED FOREX TRADER :

https://dai.ly/x7z1qd

https://youtu.be/XHaIk4xREPM










There are already thousands and thousands and thousands of high probability, high win rate, 100% trading accuracy .... forex trading strategies available on the internet.
And those people even disclosed their trading secrets.
And some of those people have been interviewed by the famous BBC / Bloomberg!!!!!


Members can easily GOOGLE for such information.
So you don't need to create another one unless you can prove that you are very from those people.
Also, have you been interviewed by BBC / Bloomberg / CNBC / Reuters / Market Watch .... ?


Perhaps you were born before WW2.
Do note that nowadays, with the internet,
newbies can easily GOOGLE for high probability, high accuracy forex trading strategy.

 

[maxinger]

At the rate things are going, soon there will be millions and millions and millions of
high probability, high win rate, 100% forex trading accuracy trading strategy in
the internet.

 

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4. RSI Rollercoaster

According to the author, the ability of the indicator used by this setup, the Relative Strength Index (RSI), to measure turns in price by measuring turns in momentum, is unmatched by almost any other tool in technical analysis. He also states that first and foremost, the RSI Rollercoaster setup works best in a range environment.

The corresponding steps are pretty simple…

For a long trade, you wait for an RSI reading of less than 30, after which you then wait for an up candle to form and close with an RSI reading greater than 30. At his point, you go long at market on the open of the next candle.

The stop loss is set at the swing low, with half of the position exited at 50% of risk. At that point, the stop is immediately moved to breakeven, and the rest of the position is exited when stopped out at breakeven, or when it moves into "overbought" territory, and then drops from that level. Profit is taken at the close of the corresponding candle.

When I tried applying this technique to a daily chart, the first problem I had was that the asset was almost never neutral, and if I tried to implement the strategy as directed, I would inevitably have been trading against the dominant trend. So then, this approach is going to have a relatively restricted application.

Since there were already instructions for what to do when pairs are in consolidation (obviously, for short positions, one does the exact opposite of what was described above) I decided to consider what to do when a pair is NOT ranging…

Again, the steps turned out to be pretty simple. Using the white baseline to discern the direction of the trend, it appeared to me that profitable long positions could have been entered in bull markets by doing so when the RSI crawled below 45, and profitable short positions could have been entered in bear markets when the RSI climbed above 55.

Interestingly enough, exits would STILL have been at the 30 and 70 level marks, as recommended in the original directions.

 

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5. PURE FADE

This strategy, which Prescott recommends be used exclusively with one-hour charts, seems to be pretty solid as far as I'm concerned. However, it's kind of its own animal and is not well suited for a one-to-one comparison with Numerical Price Prediction (NPP). Also, it looked to me like this setup does not offer a whole lot of trade opportunities.

Consequently, rather than summarize the approach here, I decided to simply look to see if a description already existed online, which it does. So, anyone who wishes to see detailed instructions on how to execute this type of trade (which uses three Bollinger bands and the RSI) can navigate to the following URL...

https://forexar.yolasite.com/index/the-pure-fade-trade

 

[Overnight]

4. RSI Rollercoaster...

Interestingly enough, exits would STILL have been at the 30 and 70 level marks, as recommended in the original directions.

Exactly right. You have no idea what you are doing. You have taken TA to an extreme though so many levels your head is spinning. So with this latest one, WHAT WILL THE PRICE DO TOMORROW?!? Hell, you are no longer showing instruments and price levels. You are just showing snakes on a plane or something.

 

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6. THE MEMORY OF PRICE

This setup is designed for those traders wishing to avoid the experience of being stopped out of positions just before price reverses direction in what would have been their favor. It rests on the assumption that the support and resistance points of double tops and double bottoms exert an influence on price action even after they are broken by acting almost like magnetic fields attracting price action back to those points after the majority of the stops have been cleared.

It's thought that this occurs because it takes a tremendous amount of buying power to exceed the value of the prior range of the double-top breakout as well as for a double-bottom breakdown, with a break above or below the previous top or bottom requiring traders to not only expend capital and power to overcome the bottom-side support or topside resistance, but also to retain enough additional momentum to fuel the moves further.

By such time, much of the momentum will have been expended on the challenge to the double top or bottom so that it is unlikely the move producing the second top or bottom will equal the distance of the move that produced the first.

Prescott writes that this pattern is seen quite often on both hourly and daily charts. Supposedly, daily charts will experience fewer failures because the range extensions will be much larger, but this also means that on daily charts, the setup will generate much larger losses, so that traders must weigh the advantages and disadvantages and adopt risk parameters accordingly.

Moreover, even under the best conditions, this setup returns only one unit of reward for every 1.5 units of risk, and must therefore be accurate 70% of the time to reap a positive outcome in the long run.

So then frankly, beyond summarizing the above information, there is not much for me to analyze here, except to say that I already use a system that employs concrete numbers to clearly convey such measures as the slope of the trend in multiple time frames along with their associated price ranges, so that further exploration of a setup based on vague and intangible measures such as "much of momentum" has no attraction to me at all.

 

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7. SEVEN-DAY EXTENSION FADE

This trade is based on the contention that after seven days of consecutive strength, prices need a pause. Prescott states that "we have tried this strategy on hourly charts, but since sentiment tends to be much more intractable in the market throughout the day, the setup is not nearly as reliable." So obviously, it is recommended that the strategy be used exclusively on daily charts. Anyone wishing to know the details on how it is carried out can navigate to this URL:

http://investpost.org/cash/extension-fade-of-seven-days-forex-strategy/

The author includes the seven-day extension fade in this publication, even though he himself concedes that "trying to pick tops or bottoms with no indicator support is probably one of the least constructive ways of trading," which is exactly what this approach attempts to do. He also notes that "the setup is rare," but that when it does occur, it is significant.

Nonetheless, given the infrequency of its occurrence, and seeing as how there is no reason for me NOT to continue employing the statistical models I have for calculating where the market is likely to produce tops and bottoms, whether the previous seven candles were all the same color or not, and to do so on a consistent basis, I'm not inclined to give this trade any more consideration, nor to look for opportunities when live (or even demo) trading to test it out.

 

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8. TURN TO TREND

According to Prescott, this last setup is designed to find turns in price action in the context of the overarching framework of trading with the trend. It uses two time frames, a moving average and two sets of Bollinger bands as tools of entry.

First of all, the 20-period SMA is dropped on daily charts and used to determine if a given pair is in a trend. Bollinger bands are then plotted on hourly charts at both two and three standard deviations to create channels for pinpointing entries.

After consulting its daily chart to determine if a particular pair is trending in a given direction, traders then move to its hourly chart to see where candlesticks are painting in relation to the two sets of Bollinger bands. If the daily chart evidences a bullish trend, but the rate is trading between the lower bands of the two indicators loaded on the hourly chart, it tells traders to stay away (given the present downward momentum).

However, once price trades above the lower Bollinger band at two standard deviations, it is time to enter the market. A stop loss is set at the swing low minus five points. The target for the first half of the position is set at half the amount of risk. If this target is hit, the stop is moved to breakeven and the target for the second half of the position is set at the upper Bollinger band at three standard deviations. In other words, profit is taken as soon as price crosses to the outside (to the exterior) above the channel formed by the two upper Bollinger bands.

(Obviously, the opposite is done when the daily chart displays a bearish trend.)