Easy Trend Forex Trading Strategy

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Easy Trend Forex Trading Strategy 1

Sometimes the simple strategies are the ones that work better. A simple strategy with no fuss. Clear entry signals that show where exactly to take the trade. These are the kinds of strategy that often work well in trading.

The Easy Trend strategy is based on custom indicators that do this. Indicators that show when it is ok to take a trade and which direction, and more importantly which candle is the exact entry point and where to exit the trade.

The Buy Sell Magic

The Buy Sell Magic indicator is a custom indicator that indicates which way the short-term trend is going. It is somehow similar to the Parabolic SAR, which prints dots either above or below a candle depending on the direction of the short-term trend. Whenever the dots are printed below the candles, this means that the market is somewhat bullish on the short-term. On the other hand, if the dots are printed above the candles, this means that the trend is somewhat bearish.

Some traders use this as a basis to get in or out of a trade. It is typically used as an entry signal by taking the trade whenever the dot changes direction.

The Buy Sell Indicator

The Buy Sell Indicator, although it is named somewhat similar to the above-mentioned indicator, functions differently. It is a custom indicator that indicates precise entry points. It does this by conveniently printing arrows on the actual entry points. Blue arrows pointing up indicate entry points for buy trades and red arrows pointing down indicate entry points for sell trades.

The actual basis for the signals is not specified by the developer of the indicator. However, based on my observation, it does generate several good entry signals for very short-term trades. This makes if very suitable for trading short-term trade setups that would last for only a few candles.

Trading Strategy Concept

This strategy is mainly based on the two custom indicators mentioned above. However, there are a couple more indicators that we will be using that would also play a role.

First, we will be using a 50-period Exponential Moving Average (EMA). This moving average typically represents the medium-term trend. For this reason, this will be our main trade direction filter. We will identify trend based on the location of price in relation to the moving average. Trades will only be taken in the direction of the medium-term trend.

Then, the Buy Sell Magic custom indicator. Because the Buy Sell Magic indicator is excellent in determining the short-term trend, it is very much suitable to become our second trend direction filter. This way, we will be having our medium-term and short-term trends in sync.

The actual entry will be based on the Buy Sell Indicator. As soon as an arrow appears which points the direction of the medium-term and short-term trend, we will be taking a trade. The exit will also be made as soon as the opposing arrow appears.

Lastly, we will be using Fractals. Because fractals typically coincide with short-term swing highs and swing lows, it is suitable to be used as a basis for stop losses.

Indicators:

  • Buysellmagic01
  • BuySellIndicators
  • 50-period EMA (green)
  • Fractals

Timeframe: preferably 1-hour and 4-hour charts

Currency Pair: any

Trading Session: any

Buy (Long) Trade Setup

Entry

  • Price should be above the 50 EMA
  • Price should be above the lime dots of the buysellmagic01 indicator
  • Enter a buy trade order as soon as a blue upward arrow appears

Stop Loss

  • Set the stop loss at the fractal below the entry candle

Exit

  • Close the trade as soon as a red downward arrow appears

Easy Trend Forex Trading Strategy 1

Easy Trend Forex Trading Strategy 2

Sell (Short) Trade Setup

Entry

  • Price should be below the 50 EMA
  • Price should be below the lime dots of the buysellmagic01 indicator
  • Enter a sell trade order as soon as a red downward arrow appears

Stop Loss

  • Set the stop loss at the fractal above the entry candle

Exit

  • Close the trade as soon as a blue upward arrow appears

Easy Trend Forex Trading Strategy 3

Easy Trend Forex Trading Strategy 4

Conclusion

This strategy is an excellent trend following strategy. However, it shouldn’t be used on market conditions that are not trending.

The confluence of both the medium term and short term trend gives it a better probability of successful trades.

The short moves that occur in a few candles allow this strategy to make profit quickly.

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