The Basics of Forex Jump Strategy
Many Forex strategies are too rectilinear and have no flexibility. Best of all this Forex strategy works during the directed movement of the price (trend). However, to say that it is the trend trade strategy would be wrong as except classical function, it can effectively work even in a fleta.
Simple statistics: the traders working in four-digit brokers Forex since September, 2013, used the specified strategy and got on average in a month profit of 100 - 120 points. In February and March, 2014 use of strategy led to closing with some minus, however it is explained by sharp change of a situation in the market and lack of predictability. It should be noted that strategy Forex initially assumes successful "catching" of the direction of the pulse movement in the presence of which receiving rather serious profit, at the level of 150-200 points is possible, at the same time the measured movement with use of this strategy brings earnings at the level of 50-80 points.
For a start it is necessary to determine key parameters of strategy Forex "Jump":
- We establish a time interval on H1, and as the main currency pair we choose GBP/USD (why it? Because with other couples selection of value of moving average is required)
- We pass to indicators which are used in the trade strategy "Jump". Buy Sell pressure volume (the indicator is downloaded separately, it is necessary to determine the period 30) will be the main indicator of this strategy, further it is necessary to check established by default for MT4 Parabolic SAR (parameters need to be chosen as 0.02; 0.2), and after it we check the parameter of Exponential moving average which is also available in MT4 (for it we choose the period 48).
Under what conditions there is an efficiency of the conclusion of the transaction on purchase for strategy Forex "Jump":
1) The first situation. The Buy Sell pressure volume indicator becomes positive, i.e. its color changes from red on green. At emergence of such candle of Parabolic SAR automatically jumps over low prices. At the time of opening of the following candle the long position opens.
The second is possible a situation. Buy Sell pressure volume changes the color after transition of the Parabolic SAR indicator under the price. In such situations it is necessary to open a long position on the following candle and also an indispensable condition is the arrangement of the price higher, than value of moving average that automatically makes the conclusion of transactions only on MA 48 trend.
2) If the stop order is established a little below than Parabolic SAR, (but no more than 50 points), it is necessary to move the stop warrant on Parabolic SAR points until the specified indicator is located below an entry point. If 30 points are passed in a positive zone, it is necessary to transfer stop loss to the level of the price of opening of the transaction, the position will be translated in without a loss.
3) When the current profit reaches a point in 50 points, it is necessary to put the transaction on a treyling (here stop will be noted at the level of 25 points) or Universal. There is no difference any, a main goal – that such indicator was to you convenient.
Under what conditions the efficiency of the conclusion of short positions on strategy "Jump" is noted:
1) The first situation. If the Buy Sell pressure volume indicator becomes negative, i.e. color changes from green on red. During this Parabolic SAR changes arrangement and is located over the price. Opening of the following candle should be begun with opening of the transaction for sale.
The second situation. After Parabolic SAR appears over the price, on the following candle there is a change of color of the Buy Sell pressure volume indicator. In that case the short position is taken at the price of opening of the following candle. At such option the price surely has to be under moving average - bargains are concluded only on MA 48 trend.
2) If stop лосс it is exposed several points above the Parabolic SAR indicator (no more than 50 points). At the moment while the indicator is over an entry point, it is necessary to reduce value of the stop warrant on Parabolic SAR points. When 30 points of a positive zone are passed, transfer stop loss on the level of opening of the transaction – on level without loss is required.
3) When the current profit reaches value in 50 points, it is necessary to establish the transaction on a treyling - a stop in 25 points.
• In the second option of an entrance usually it is much less transactions, however they differ in high precision and the amount of total profit.
• If the broker Forex concludes bargains on and option, it is possible to consider placement of the price concerning moving average. However such addition is not obligatory.