142# Trading in Trending with Retracement Trading System Daily
Daily Forex Strategy: Envelope with Two moving averages smoothed
Submit by Janus Trader 05/07/2013
This is an daily trend following forex trading system, based on the two smoothed moving averages and the envelope indicator. I think, that for forex strategies trend following, the best moving averages are those smoothed.
Time Frame Daily.
Moving average smoothed 3 period;
Moving average smoothed 8 period,
Envelope indicator period 5 deviation 0.5;
Envelope indicator period 5 deviation 1.0.(The deviations of the second envelope indicator depends by volatility of the currency pair this is only a indicative value)
Rules:Trading in Trending with Retracement Trading System Daily
Setup step by step
Wait for the 3 Moving average smoothed cross up 8 Moving average smoothed;
Wait an pullback of the price, a red candle with body must be within ( high/low/close) the upper first red envelope band and lower first red envelpe.
This is the setup candle.
Place an pending order for the next day 4 pips above the high the setup candle and place a initial stop loss on the previous swing after 40-70 pips in gain move stop loss at -25 pips by entry point (the numbers of the pips depends by currency pairs).
first option when price touches the second blue envelope band
second option when the moving average smoothed cross in opposite direction,
third option with profit target predetermined 150-300 pips.
Buy conditions are reversed.
In the pictures below Trading in Trending with Retracement Trading System Daily in action.
Trading in Trending with Retracement Trading System Daily
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