14# Envelopes with Stochastic. Day Trading Strategy For Mobile.
Envelpes as Support and resistance dynamic.
Price Action Momentum for high volatility market and mean reversion currency pairs.
Submitby Janus Trader
Envelopes with Stochastic is a price action momentum strategy, for day trading and suitable for mobile Metatrader app mobile. This trading system can trade both very volatile instruments and mean reversion instruments (it's simpler). My advice is to start using this strategy with mean reversion instruments like EURGBP, EURCHF, and the like. Then you have learned the technique well and are familiar with money management techniques (lots) you can trade on highly volatile instruments such as the VIX index.
This is a winning strategy you just have to learn how to use it and compared to trend following and breakout techniques it has a lower psychological impact.
The fundamental principle of this strategy is to wait for the price to bounce on the envelopes and enter with the agreement of the stochastic.
The reference envelopes are from the double group to the external ones. In particular, it should be noted that when the price leaves the envelopes they are a great opportunity.
Setup Strategy
Time Frame 15 min.
Currency pairs: any, Indices, Vix, and Commodities.
Indicators
Envelopes setting:
1. period 60, deviation 0.900, Method smoothed, close;
2. period 60, deviation 2.5, Method smoothed, close;
3. period 60, deviation 0.45, Method smoothed, close;
4. period 60, deviation 0.88, Method smoothed, close;
5. period 60, deviation 0.85, Method smoothed, close;
6. period 60, deviation 0.83, Method smoothed, close;
7. period 60, deviation 1.67, Method smoothed, close;
8. period 60, deviation 1.68, Method smoothed, close;
Stochastic oscillator (14,8,8, close), levels 10 strong buy, 20, buy, 80, sell, 90, strong sell.
Trading rules Envelopes with Stochastic.
General rules:
Wait for who the price bounces on the envelopes starting from the median ones with double lines with deviation 0.88-0.83.
When the price is out of the envelopes, enter the stochastic cross from the extreme areas.
Buy
Price bounces on the lower bands, the stochastic crosses upwards.
When the price is out of the bands wait for the stochastic crossing upwards starting from the extreme areas.
You can do up to three entrances in the same direction in sequence on the stochastic crosses.
Enter the stop loss on the previous lower swing.
Sell
Price bounces on the lupper bands, the stochastic crosses downwards.
When the price is out of the bands wait for the stochastic crossing downwards starting from the extreme areas.
You can do up to three entrances in the same direction in sequence on the stochastic crosses.
Enter the stop loss on the previous higher swing.
This is a winning strategy not suitable for beginners which however can be configured on all desktop trading platforms MT5, MT4, Trading View, Pro Real Time, Metastock, Tradestation etc.
Examples of trades.
