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Confirmed Crossover Forex Trading Strategy

Amandeep Sonewane | Jun. 18, 2019
Confirmed Crossover Forex Trading Strategy

You can now download the Confirmed Crossover Forex Trading Strategy for free on AtoZ Markets indicators gallery

Confirmed Crossover Forex Trading Strategy is a very basic and popularly used trading strategy. It is a pretty fast crossover strategy that excels in catching a trend pretty early. As you could notice, the 5-10 SMA strategy is able to capture big trends from start to finish. Because the moving averages used hug closely to price, the crossovers could respond quickly to whatever price does and therefore allows us to catch a trend right from the start.

Knowing that confluences stack the odds on our favor when looking for confluences, this strategy will be based on the 5-10 SMA Crossover Strategy, but with some additional confluences. What we will be looking for is a crossover that agrees with the long-term trend and a fresh thrust.

To filter signals that do not agree with the long-term trend, we will be using the 200 Exponential Moving Average (EMA). This is a commonly used moving average filter that many traders use to determine the long-term trend.

Indicator:

  • 5-period SMA (Gold)
  • 10-period SMA (Green)
  • 200-period EMA (Brown)
  • Stochastic Oscillator

Currency Pair: any

Timeframe: 4-hour and daily charts

Trading Session: any

How to trade with Confirmed Crossover Forex Trading Strategy?

Entry

  • Price and the 5 & 10 SMAs should be above the 200 SMA
  • Fast Stochastic should be above the Slow Stochastic line
  • 5 SMA should cross above the 10 SMA
  • Fast Stochastic should be crossing above 50
  • Enter at the close of the candle corresponding the confluence of the above rules

Stop Loss

  • Set the stop loss below the 10 SMA

Exit/Take Profit

  • Option 1: Set the take profit at 2x the risk on the stop loss
  • Option 2: Close the trade on the reverse crossover of the 5 & 10 SMA

Sell (Short) Trade Setup Rules

Entry

  • Price and the 5 & 10 SMAs should be below the 200 SMA
  • Fast Stochastic should be below the Slow Stochastic line
  • 5 SMA should cross below the 10 SMA
  • Fast Stochastic should be crossing below 50
  • Enter at the close of the candle corresponding the confluence of the above rules

Stop Loss

  • Set the stop loss above the 10 SMA

Exit/Take Profit

  • Option 1: Set the take profit at 2x the risk on the stop loss
  • Option 2: Close the trade on the reverse crossover of the 5 & 10 SMA

How to download and install an indicator?

In order to install the indicator on your MT4 platform, you need to follow these steps:

  1. Click on “Download Indicator” button located at the top right corner of the screen.
  2. Save the file to your computer.
  3. Extract and move the files into MT4>Indicator folder of the MetaTrader4 software file directory.
  4. Restart your Metatrader platform.
  5. Navigate to “Indicators.”
  6. And select “Confirmed Crossover Forex Trading Strategy” template to apply it on the chart.

Note: This indicator was developed by T. Morris. AtoZ Markets does not carry any copyrights over this trading tool.

Disclaimer: The views and opinions expressed in this article are solely those of the author and do not reflect the official policy or position of AtoZ Markets.com, nor should they be attributed to AtoZMarkets.