This trading strategy uses Heiken Ashi indicator which is famous amongst pro FX traders. Support and resistances are some of the most basic ways to trade forex. Many traders, when they first come into trading, this is one of the first things they know about. FX Traders experience some difficulty as they first start out learning the craft of trading supports and resistances. So, they move on to the next shiny thing that catches their attention.
Indicators: Heiken Ashi
Timeframe: preferably 15-min, 1-hour, 4-hour and daily charts
Currency Pair: any
Trading Session: any
How to Trade with Heiken Ashi Wave Forex Trading Strategy?
Based on the chart below, where should we take the trade? Definitely not after drive 1 and 3, what comes after those are pullbacks. You wouldn’t want to take a trade that goes against the general trend of the market. Right after number 2? Maybe, after all, move 3 is usually the strongest drive of this pattern. Maybe, if you have a way to predict it was going to be a bullish channel.
With this strategy, however, we would take the trade only on the fourth move, which is probably the last drive. In this way, we get an idea of the market is on a bullish trend because of the higher high made by move 3. Then we need to draw the support line by connecting the base of move 1 and the retrace on move 2. And at last, extend it further to anticipate where price could bounce off from.
Trade Setup
Entry
- Identify the initial phase of the Elliott Wave pattern, which is move 1 to 3
- Draw the support line by connecting the base of the drives
- Wait for price to revisit and touch the support line
- Wait for the Heiken Ashi candle to turn green
- As soon as the Heiken Ashi candle turns green, place a buy stop order at the high of the candle and let the market fill the order
Stop Loss
- Set the stop loss a few pips below the candle that touched the support line
Take Profit
- Set the take profit target at the high of move 3
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How to download and install an indicator?
In order to install the indicator on your MT4 platform, you need to follow these steps:
- Click on the “Download Indicator” button located at the bottom of the post.
- Save the file to your computer.
- Extract and move the files into MT4>Indicator folder of the MetaTrader4 software file directory.
- Restart your Metatrader platform.
- Navigate to “Indicators.”
- And select the “Heiken Ashi Wave 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.
Should you trade Forex using Heiken Ashi Wave strategy on your own at all?
Before you start trading Forex with this strategy, you'll want to read this.
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