Vegas Moving Average Forex Trading Strategy

0
916
Vegas Moving Average Forex Trading Strategy 1

Trading need not be complicate things. One of the most common mistakes that new traders make is that they assume that trading should be sophisticated for it to work. So, they look for a strategy and find that these strategies are too simple, and they start to develop it further not knowing that they are already overcomplicating their trading plans. Now, there is nothing wrong with a sophisticated strategy. The problem lies with whether the added sophistication does improve their performance. Most of the time it does not. It could even work the other way by adding too much clutter on their charts, causing them to freeze whenever an opportunity becomes available. The notion that trading should be sophisticated for it to work is very far from the truth. Sometimes simplicity is better.

Trading strategies that are simple are often overlooked. However, there are many simple trading strategies that do work and could fetch a lot of pips day in and day out. The Vegas Moving Average Forex Trading Strategy is a very simple trading strategy which many traders could use, even beginners. Despite its simplicity, it can provide trading signals that have a very good potential of resulting in huge profits.

Vegas Currency Indicator

The Vegas Currency indicator is a custom trend indicator which aids traders in identifying trend direction. This indicator is based on two Exponential Moving Average (EMA), the 144-period EMA and the 169-period EMA. These EMAs are set for the long-term trend, which is very useful for traders who are looking to trade longer-term trends.

The Vegas Currency indicator is in itself a crossover strategy. The crossover points of the two EMA lines are indicative of a long-term trend reversal. On its own, using just these signals could already provide great entries that could result in gaining pips.

Aside from the two moving average lines, the Vegas Currency indicator also has some outer bands that envelope the two moving averages. These lines could be used by mean traders when looking for overextended market conditions, and momentum traders who are looking strong signals that would often break out of these bands.

VAR Moving Average

The VAR Moving Average or “Var Mov Avg” is a modified moving average indicator. This indicator has a complex computation behind it, but it manages to simplify the implementation of the indicator, allowing any trader to easily understand how to use it.

This indicator is derived from the Adaptive Moving Average (AMA) plus some other modifications on the moving average itself. The resulting moving average line is a smooth yet responsive type of moving average line, which is what most traders would want. It has less lag compared to most moving averages, yet it also manages to lessen potential false signals.

The Var Mov Avg indicator also indicates trend reversal signals based on the slope of the moving average line. It overlays yellow dots on an upward sloping line and magenta dots on a downward sloping moving average line. These color changes could be used as a trend reversal signal using the slope of the Var Mov Avg indicator.

Trading Strategy

This trading strategy is based on trend reversal signals using the Vegas Currency indicator and the Var Mov Avg indicator. Signals are based on a simple crossover strategy using these two long-term trend indicators.

The Var Mov Avg indicator would represent the long-term moving average line. The two middle lines of the Vegas Currency indicator, colored green and blue, would represent the shorter-term moving average lines. Trade signals are then considered as the green and blue lines of the Vegas Currency indicator crosses over the Var Mov Avg dotted line.

Indicators:

  • Vegas_Currency_Daily
    • Risk Model: 2
  • Var_Mov_Avg

Timeframe: 1-hour, 4-hour and daily charts

Currency Pairs: major and minor pairs

Trading Session: Tokyo, London and New York sessions

Buy Trade Setup

Entry

  • Price should cross and close above the dotted Var Mov Avg line
  • The Var Mov Avg indicator should print yellow dots on its line indicating that the moving average line is sloping upwards
  • The green and blue lines of the Vegas Currency indicator should cross above the dotted Var Mov Avg line indicating a bullish trend reversal
  • Enter a buy order on the confluence of the above conditions

Stop Loss

  • Set the stop loss on the support level below the entry candle

Exit

  • Close the trade as soon as price closes below the Var Mov Avg line
  • Close the trade as soon the dots on the Var Mov Avg line changes to magenta

Vegas Moving Average Forex Trading Strategy 1

Vegas Moving Average Forex Trading Strategy 2

Sell Trade Setup

Entry

  • Price should cross and close below the dotted Var Mov Avg line
  • The Var Mov Avg indicator should print magenta dots on its line indicating that the moving average line is sloping downwards
  • The green and blue lines of the Vegas Currency indicator should cross below the dotted Var Mov Avg line indicating a bearish trend reversal
  • Enter a sell order on the confluence of the above conditions

Stop Loss

  • Set the stop loss on the resistance level above the entry candle

Exit

  • Close the trade as soon as price closes above the Var Mov Avg line
  • Close the trade as soon the dots on the Var Mov Avg line changes to yellow

Vegas Moving Average Forex Trading Strategy 3

Vegas Moving Average Forex Trading Strategy 4

Conclusion

Even with its simplicity, this trading strategy is one which could fetch huge gains for traders. In fact, it is its simplicity that makes it very valuable. It is easy for new traders to implement and follow through. Trade signals are easy to comprehend, and momentum shifts are clearly indicated.

On top of that, this trading strategy is one which generates trade signals that has a high probability of resulting in huge gains. It allows traders to catch a trend early on and ride it until the end. This allows traders to squeeze more gains out of every trend reversal that the market does.

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