(+) Swing Trade Strategies

RIDING THE TREND TRADING STRATEGY

"Following the master trend is the wisest strategy either when you are a Day-Trader or a Swing-Trader"

TRADING STRATEGY

■ Style: Swing Trade Strategy

■ Name: Riding the Trend Trading Strategy

FINANCIAL ASSETS

■ Forex Majors | ■ Metals and Energy | ■ Stocks | ■ Indices

TIMEFRAME

■ H1 timeframe (1-Hour)

INDICATORS & SETUP

This strategy is applied using a simple model of determining the trend and Stochastic.

■ Determining the Trend

In order to determine the trend we use the simplest definition of trend formation.

Rising Trend:

A Trend is rising when a local High is higher than the previous High and at the same time the recent Low is Higher than the previous Low.

Falling Trend:

A Trend is falling when a Local Low is lower than the previous Low and at the same time the recent High was lower than the previous High.

■ Stochastic

We set the Stochastic at:

%K period = 12, %D period = 3, Slowing = 3

Note that the standard settings are (14,3,3)

TRADING SIGNALS

This is how you may implement the Riding-the-Trend Strategy

■ (↑) Long Trades

1. Identify a new Uptrend using the simple definition mentioned before.

“The New High is Higher than the Previous High and the Recent Low is Higher than the Previous Low”

2. Confirm that Stochastic is recovering from the oversold levels of 20 and enter a Long Trade.

■ (↓) Short Trades

1. Identify a new Downtrend using the simple definition mentioned before.

“The New Low is lower than the Previous Low and the Recent High is Lower than the Previous High”

2. Confirm that Stochastic is falling from the overbought levels of 80 and enter a Short Trade.

TRADING ORDERS

■ Take Profit: 100 pips | ■ Stop-Loss: 40-50 pips | ■ Profit/Loss Ratio: 2

CHART: Riding the Trend Strategy

■ Riding the Trend Trading Strategy

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THE MOVING ENVELOPES TRADING STRATEGY

"Moving Averages can be a great tool for determining the master trend but also to signal trades by using the Moving Average Envelopes"

TRADING STRATEGY

■ Style: Swing Trading Strategy

■ Name: Trading the Moving Envelopes Strategy

FINANCIAL ASSETS

■ Forex Majors | ■ Metals and Energy | ■ Stocks | ■ Indices

TIMEFRAME

■ H1 timeframe (1-Hour)

INDICATORS & SETUP

This strategy is applied using two Moving Averages and the ADX

In order to create the envelope, you need two simple moving averages (SMA). Any signal generated by the SMAs is confirmed using the Average Directional Movement Index (ADX)

1. Two SMAs (Two Simple Moving Averages)

SMA-1 (fast): choose 9 periods

SMA-2 (slow): choose 21 periods

2. ADX

ADX Settings

2. Average Directional Movement Index with Meta Trader 4 default

setting (ADX 14). A level of 40 is added.

TRADING SIGNALS

This is how you may implement the Trading the Moving Envelopes Strategy

■ (↑) Long Trades

If the fast SMA (9 periods) crosses above the slow SMA (21 periods) you get a Buy signal. Confirm this signal with a falling ADX. A falling ADX indicates that the market volatility is falling and that may be good news for an upcoming bullish market.

■ (↓) Short Trades

If the slow SMA (21 periods) crosses above the fast SMA (9 periods) you get a Sell signal. Confirm this signal with a rising ADX. A rising ADX means that the market volatility is rising.

TRADING ORDERS

■ Take Profit: 240-300 pips | ■ Stop-Loss: 80-100 pips | ■ Profit/Loss Ratio: 3

CHART: MOVING ENVELOPES (EURUSD)

■ Trading the Moving Envelopes Trading Strategy

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