5 minute Intraday
This system works on 5 minute candle chart and the pairs that you can use on this system are EURUSD, GBPUSD, USDJPY, EURJPY.
Indicators are listed below:1.
- EMA = 10 & 21
- SMA = 50
- SMA angle window:
- SMA angle indicator;
– EMA based on first indicator data overlaying this indicator.
Set up:
- 0.1 & -0.1 on EURUSD, GBPUSD and USDJPY
0.15 & -0.15 on USDJPY
0.4 & -0.4 on all pairs
ADX window set up:
- Set it at 13
- Overlay with lsma 3 indicator.
TRADE CRITERIA:
1.) 50 SMA angle must be more than 20 degree.
- Subjective measurement, not accurate.
- Used in the beginning of the thread and changed late to 21 MA on the SMA angle indicator as a guide.
- Applicable to this system because the angle of the 50 MA is the main principle of the system.
2.) 21 EMA on SMA angle indicator must cross the 0.1 or -0.1/0.15 or 0.15 line.
- The area between the 0.01 and -0.1 is called the no-trade zone.
- If 21 MA is in the no trade zone, no position must be opened.
3.) The price must pull back through 10 EMA to 21 EMA.
- Fire or war zone is the name
4.) The price should stay on the correct side of the small resistance or support.
- Last high or low before the cross of the 51MA.
- Nest high or low to form a small resistance/support.
5.) SMA angle indicator must be higher or lower than 0.2 & -0.2 (but support and resistance is more accurate.)
THE TRADE SET-UP:
Rule 1: Small trend line rule:
- Make sure that the price and candles stay on the correct side of the small trend line.
- If breakout occurs, cancel the set ups or possible trades.
Rule 2: Specific manner of pullback of candles towards war zone:
- No steep pullbacks, just smooth and flat pullbacks of the candles.
- There must be no sharp V shape change of direction. It must be smooth rounding of top or bottom. (Wavelike pullbacks).
- * Ascending of descending triangle being formed between resistance or support level and small trend drawn.
Rule 3: Pullback into war zone:
- Identify the first candle to enter the war zone towards 21MA.
- Wait for second/more candle to pull back from 21MA towards 10MA.
- Enter the trade on the pullback a few pips away from the 21MA.
Rule 4: Additional ADX rule (not yet fully tested):
- For a long trade, the positive line (Blue) must be above the negative line (Red) with Isma line crossed the red line to go in between Blue and red line
- For a short trade, the negative line (Red) must be above the positive line (Blue) with Isma line crossed the blue line to go in between Blue and red line.
- The trend line must be above 25 level
- If the ratio between the positive and negative line is almost 2:1, expect the pullback only up to the 10MA and enter the trade.
THE TRADE:
- Use a market order to enter within the war zone.
- Put Stop Loss 6+spread pips away
- Move stop loss to breakeven after a clean 6 pips gain/profit (brokerage/spread included
- No Trailing Stop Loss
- Put profit limit on 10-15 pips
There are a lot of changes during the trade;
- Don’t try to trade every signal that might work
- Wait for the good setup to occur
- Wait for the High probability ones
- Rather miss an opportunity than to get involve in a bad/wrong set-up
The Entry looks:
- Small candles
- Flat type of pull back
- Some sort of Resistance (uptrend) and Support (down trend) to form a small
- acsending or decending triangle awaiting a breakout within the war zone.
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