369# Forex Bliz
EMA indicator with Fibonacci Retracement
Submit by JamesUK 11/08/2013
Firstly, we will begin with the tools needed for Forex Blitz:
Time Frame
• The main time frame we are going to watch is the 1-hour time frame.
After confirming the trend, we will look to 5-min chart for entering and
exiting a position. You can also trade the 15-minute time frame with 5-
minute chart to determine your entries.
Exponential Moving Average as Trend Indicator
• 55-EMA; using weighted moving average, we can identify the immediate
trend faster than a Simple Moving Average. This is one of the important
indicators in the FB system as it will tell us whether to enter long or enter
short.
MACD Oscillator
• FastEMA 4, SlowEMA 9 and SignalSMA 6; this oscillator will helps traders
to identify market momentum and thus creates entry signals. Divergence
is the most effective early sign that the movement is going to reverse.
Power Hours
• These hours are especially volatile because it eclipses at least two major
foreign exchange markets from the Asians to the Europeans then the
Americans.
• 0700 GMT – 1800 GMT
Trading Pairs
• GBP/USD and EUR/JPY. Although it seems that most of the majors and
crosses worked well, but I did not try with other pairs so please do a
demo first because going live on other currency pairs.
Buy (Long)
• The closing price must be above the 55-EMA on the hourly chart
• The closing hourly candlestick must be a bullish candlestick
• MACD bar must show a positive divergence or show a higher low bar
Figure 1
• If all of the conditions above agree,
o switch to 5-min chart
o Scenario A: look out for 38.2% or 50% Fibonacci retracement
(support)
Scenario B: if the price action does not retrace to 38.2% level, open
long position at the break of the previous hourly candle’s high; set
stop loss at 61.8% or at recent swing low if your percentage risk
per trade allows.
• Depending on the number of lots you enter, you should exit part of the
position at the first recommended exit target from 1 to 3 and move the
remaining lots to break even. Exit the rest of the lots when the price
action hits the recommended exit target from 4 to 7 (see the attached
calculator).
Sell (Short)
• The closing price must be below the 55-EMA on the hourly chart
• The closing hourly candlestick must be a bearish candlestick
• MACD oscillator must cross lower the SignalEMA on the hourly chart and
color must be in RED (see Figure 2).
If all of the conditions above agree,
o switch to 5-min chart
o Scenario A: look out for 38.2% or 50% Fibonacci retracement
(support) from the recent swing high on the hourly chart. Open
short position if the candlestick closes below the retracement level
(either 38.2% or 50%); set stop loss at 61.8% or the recent swing
high if your risk per trade allows.
Scenario B: at the next candlestick, if the price action does not
retrace to 38.2% level, open long position at the break of the
previous hourly candle’s low; set stop loss at 61.8% or at recent
swing high if your percentage risk per trade allows.
• Depending on the number of lots you enter, you should exit part of the
position at the first recommended exit target from 1 to 3 and move the
remaining lots to break even. Exit the rest of the lots when the price
action hits the recommended exit target from 4 to 7 (see the attached
calculator).
Forex Bliz: Template, Indicators and Fibonacci calculator
Write a comment
Frank (Tuesday, 13 August 2013 16:18)
Hi James , very nice system ! 2 questions : 1 ) macd contained into the ForexBliz rar is not colored ( blue & red ) 2) what do you mean by "attached calculator " ?
Thank's for answer.
Forextradingstrategiesresources (Wednesday, 14 August 2013 01:42)
xls file