FOREX Pivot candles
Forex Strategy Bearing candles
Forex Strategy Bearing candles is based on candlestick patterns - the hammer and the levels of support and resistance prices (reference levels) - Pivot (Pivot);
1) Hammer Pattern (hammer)
And so perfect hammer pattern can be identified by the following characteristics:
1. Tail candle (its lower or upper shadow), at least 2 times should be longer than the body itself and the top of the candle of her shadow.
2. Hammer is at an important level of support or resistance.
The figure shows an example of the hammer:
The figure below - an example of the inverted hammer:
2) Pivots (pivot points):
The support levels are typically operate as a magnet for the price of the financial markets. The price is very often slows their movement or stop altogether to the "reference levels" before resuming its further movement.
daily pivot points calculated on the closing prices the previous day as follows:
central reference level (pivot) - (P) = (High + Low + Close) / 3
Resistance level number 1 - (R1) = 2xP - Low
¹ 2 - (R2) = P + (R1 - S1)
¹ 3 - (R3) = High + 2x (P - Low)
The level of support number 1 - (S1) = 2xP - High
¹ 2 - (S2) = P - (R1 - S1)
¹ 3 - (S3) = Low - 2x (High - P)
For weekly pivot points - all the same, just need the price the previous trading week, rather than the previous trading day.
But for convenience, we will not rely on pivot points-level formula, and use the ready-made indicators forex (you can download them at the end of forex strategy).
3) Trading Signals enter and exit forex strategy "Bearing candles".
The strategy used to trade ranges: M15 and H4.
The 15-minute interval should be used daily pivot points (Pivot point). A 4-hour intervals ispolzuyutsya weekly pivots.
Entering the market of forex strategy PivotCandle:
to enter the market to PURCHASE must be met three conditions:
1) Price is above the exponential moving average EMA (20), and she in turn broke up EMA (50).
2) Price has broken any of these pivot-levels: S1, S2, S3, P, R1, R2 or R3, and returned again to him the same.
3) was formed hammer (the hammer is already closed).
the example below, consider the interval option to H4 (with a weekly pivot):
If all conditions have been fulfilled - we open trading position to buy at the market price of $ 3 lot (or respectively 0.3 or 0.03 - for micro-billing or cent account forex).
safety stop-loss must be placed by 10-20 points below the minimum (the tail) the resulting "hammer" or under the EMA (20) + (5-10 points). < / p>
Trading signals out of the market:
1) Closing a lot of trading positions (or 1 / 3 of the open position) as soon as the price goes toward the open position a distance equal to the value of fixed stop-loss.
2) For the remaining 2 lots safety stop-loss move the middle under the EMA (20) + (5 or 10) points as you move up the closing price on the trading position of the stop-loss in the positive area.
For transactions for Sale - the opposite rule.
For example you can see where he closed the 1st item:
Closing the remaining 2 open lots.
download forex indicator for Metatrader 4 - PivotWeekly. mq4 (used at intervals up to W1)
download forex indicator for Metatrader 4 - PivotDay. mq4 (only used at intervals to H1)