Major Trend Sunrise Forex Trading Strategy

0
1097
Major Trend Sunrise Forex Trading Strategy

The easiest way to trade the forex market, or any other trading market for that matter, is by trading with the trend. However, this is easier said than done. Most trend following traders end up taking trades that are way too late in a trend. Another common mistake done by trend followers is chasing price. Also, trend following traders could often get too greedy, which causes a winning trade to become a losing trade.

Often, trend following trading strategies are very profitable. However, many trend following traders still end up being on the losing side. If they would look back at their past losing trades, they would see that the trade should have been a big win for them, but they still ended up taking a loss on it. Why? Because of these common mistakes.

Now, trading has a very big psychological factor to it. This is the reason why many traders make these common mistakes again and again. But what traders can never do in trading is have that “Could have, should have, would have…” attitude.

Major Trend Sunrise Forex Trading Strategy, as the name suggests, is a trend following strategy. It puts in place rules that could help traders avoid making the mistakes again and again. It would not make you perfect. As a human trader, you would still be making mistakes. However, it could help improve your trade execution.

DDFX Major Trend

DDFX Major Trend is a custom indicator that helps traders identify the general direction of the trend.

It works as a trend filter indicator which gives traders information on whether price is moving up or down. It does this by plotting solid bars that changes color depending on the direction of the trend. Blue bars indicate a bullish trend while red bars indicate a bearish trend.

Forex Sunrise Indicator

Forex Sunrise Indicator is a custom trend following indicator which helps traders identify and visualize trend direction.

It is plotted as a dotted line which changes color depending on the direction of the trend. In this setup, red lines indicate a bearish trend while blue bars indicate a bullish trend.

The Forex Sunrise Indicator is characteristically much like a very smooth moving average line. Its signals are usually more reliable, and price tends to respect the line as a dynamic support or resistance.

With that said, it could also be used much like a moving average is used. Traders could use the slope of the line to identify trend or the location of price in relation to the line as a trend filter. Traders could also use the colors of the dots as a trend filter or an entry signal. It could also be used as an entry signal based on the crossing over of price and the Forex Sunrise Indicator line, and it could also be used as an entry signal based on the retracements of price towards it.

Trading Strategy

Trend following strategies work only on trending market conditions. It should not be spammed in the market even when the market is not trending. That would be a recipe for disaster.

But how would we know if the market is trending? It is when price swings are making higher highs and lows in an uptrend, or lower highs and lows in a downtrend. However, many new traders find it hard to identify this on a naked chart.

The Forex Sunrise Indicator would be used to identify trending conditions based on whether price is respecting the line. If price bounces off the indicator line, that would be a signal for a trend and a possible trade entry.

Trend direction will also be based on how the 100-period Exponential Moving Average (EMA) and the Forex Sunrise Indicator line is stacked. If the Forex Sunrise Indicator is above the 100 EMA, then it is considered an uptrend. If it is stacked inversely, then that would be a downtrend.

Trade direction would also be filtered based on the trend direction indicated by the DDFX Major Trend indicator. This will be based on the color of the DDFX Major Trend bars.

Finally, trades are exited when the trend is showing signs of a possible reversal or if its momentum is about to fizzle out. This will be based on the changing of the color of the DDFX Major Trend indicator.

Indicators:

  • 100 EMA (Green)
  • forex_sunrise_indicator (default setting)
  • DDFX MAJOR TREND (default setting)

Preferred Time Frames: 1-hour and 4-hour charts

Currency Pairs: major and minor pairs

Trading Sessions: Tokyo, London and New York sessions

Buy Trade Setup

Entry

  • The DDFX Major Trend bars should be blue.
  • The Forex Sunrise Indicator line should be above the 100 EMA line.
  • The Forex Sunrise Indicator line should be blue.
  • Price should retrace towards the Forex Sunrise Indicator line.
  • A minor diagonal resistance line should be observable as price retraces.
  • Enter a buy order as soon as price closes above the resistance line.

Stop Loss

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

Exit

  • Close the trade as soon as the DDFX Major Trend bars change to red.

Major Trend Sunrise Forex Trading Strategy

Major Trend Sunrise Forex Trading Strategy 2

Sell Trade Setup

Entry

  • The DDFX Major Trend bars should be red.
  • The Forex Sunrise Indicator line should be below the 100 EMA line.
  • The Forex Sunrise Indicator line should be red.
  • Price should retrace towards the Forex Sunrise Indicator line.
  • A minor diagonal support line should be observable as price retraces.
  • Enter a sell order as soon as price closes below the support line.

Stop Loss

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

Exit

  • Close the trade as soon as the DDFX Major Trend bars change to blue.

Major Trend Sunrise Forex Trading Strategy 3

Major Trend Sunrise Forex Trading Strategy 4

Conclusion

This type of trading strategy is a high probability trading strategy. At the same time, it also has the luxury of being able to squeeze out so much profits out of a single trade, making it a high yield trading strategy. This gives traders the best of both worlds, a high win rate and reward-risk ratio.

However, the key here is in using the strategy at the right time. Traders should not be impatient taking trades that does not seem to have a good quality setup. The key here is patience. Wait for the right setup and trade it according to plan.

Recommended MT4 Brokers

XM Broker

  • Free $50 To Start Trading Instantly! (Withdraw-able Profit)
  • Deposit Bonus up to $5,000
  • Unlimited Loyalty Program
  • Award Winning Forex Broker
  • Additional Exclusive Bonuses Throughout The Year

XM broker

>> Sign Up for XM Broker Account here <<

FBS Broker

  • Trade 100 Bonus: Free $100 to kickstart your trading journey!
  • 100% Deposit Bonus: Double your deposit up to $10,000 and trade with enhanced capital.
  • Leverage up to 1:3000: Maximizing potential profits with one of the highest leverage options available.
  • ‘Best Customer Service Broker Asia’ Award: Recognized excellence in customer support and service.
  • Seasonal Promotions: Enjoy a variety of exclusive bonuses and promotional offers all year round.

fbs broker

>> Sign Up for FBS Broker Account here <<

Click here below to download:

Save

Save



Get Download Access

Get Smarter About Forex Trading Using Indicators

Join 100,000+ subscribers and get our 5 min daily newsletter on what matters in forex.

We do not sell or share your information with anyone.

LEAVE A REPLY

Please enter your comment!
Please enter your name here