Forex Strategy Boomerang
algorithm Forex strategy Boomerang:
This forex strategy is based on a combination of traditional Forex strategy on the breakdown of the elements of Martingale . The purpose of the strategy "Boomerang" is to identify small targets profit and receiving this income. Making a profit in the forex strategy is very closely connected with money management (as Trade is conducted according to the method of Martingale), which will be further discussed below. This trading system is unique that by trading on it, we can take small profits in sideways markets, as well as big profits in trending markets . This system was designed more polutara years, long modified, as well as its varied components.
settings to work on the strategy of "Boomerang" is very simple, very well trading system can be used in all types of traders FOREX. Ie: those who like to sit all day behind the monitor, be able to trade on it during the day. But those who do not like to be a long time before the screen monitors would be able at any moment to close the bargain, and when they return to the computer in his spare time, will be able to open a new trading position.
I think you will find it helpful to this type of trade.
Features forex trading strategy Boomerang:
- H4 - 4-hour schedule (GBPUSD or GBPJPY)
- H1 - Hourly chart (GBPUSD or GBPJPY)
- EMA (blue, on the closing prices stamped on the 4-hour chart)
- Microsoft Office Excel - a table attached to the end of this strategy.
conclusion of the transaction on the forex strategy Boomerang:
All entries into the market based on a 4-hour chart. All pricing schedule is designed to more closely examine trade deals already, after they were concluded. We also can fully replace the hour schedule, the schedule of any lower than the 4-hour time slot.
rules open trading position to buy:
- The price must be above the EMA on the 4 hour chart.
- The price must be higher than the median prices of the previous 4-hour bar in the chart.
to re-enter the market - the basis of the opening of a long trading position is the fact that the previous trade deal, which was closed by the stop was just a short transaction.
Determining the size of a trading position, take profit, safety stop-loss on forex strategy Boomerang.
To do this we need to book Excel (at the end of the strategy). Assume that we have matched all of the major criteria for opening a trading position to buy. The current price for a 4-hour bar 1.9936.
A few comments: it is desirable that the price was the opening price, immediately after having been closed the old 4-hour bar. This price must be higher than the median prices of the previous 4-hour bar. Once you find these basic criteria, you enter a value in the table excel, where there is written - "price of entry" - "Entry Price", then choose the bargain, we want to open it - the "long" - long. Then in the windows of the book will value for your profit and stop-loss . So, you open the first bargain at the price of 1.9936 to buy. The first profit target at 1.9946, and a safety stop-loss at 1.9931. If this deal zaklyta on foot, then your new deal will be "short" - up for sale, its price is 1.9931, take profit 1.9916, and the safety stop-loss 1.9936 and so on. aim of the strategy is that by opening one of the trading positions in a series of transactions, to catch a break and enter into a lucrative trade deal . Pay attention to the fact that the take-profit is increasing with each new transaction otkryvatoy.
You can assume that 10 pip profit is very small, so try to make it ... There method, which allows you to increase profits, if you catch a strong trend toward an open trading position you . Once your income for an open position has reached its goal of 10 pips, you can place a trailing stop at 5 pips, lot size is determined at the same time your risk tolerance.
For example, if you place a bargain for 10 lots, after the price reached on the chart 10 profit target, you close the 5 lots (or 50% of the open transaction), following the open lots are distributed as follows: 2 lots - at a trailing stop 10 points, 2 lots - at a trailing stop - 15 pips, 1 lot on a trailing stop - 20-25 pips.
This will give you a very good hedge against the losers, and along with it, to catch a strong move, though a smaller number of CMV transactions. But do not worry if you can not catch a strong trend. Your next entry in the market will already be in the next 4-hour candle. The worst scenario would be closing 50% of open trade with a profit of 5 points ....
So, to sum (% of trading positions to the left - the right size of a trailing stop)
50% - take profit 10 pips
20% - 10 points
20% - 15 points
10% - 20-25 points
you can either close a trading position at the end of the trading day, or wait for the next trading signal for the 4-hour candle.
rules open trading positions for sale:
Price should be under the EMA on the 4 hour chart.
The price must be below the median prices of the previous 4-hour bar in the chart.
for re-entry into the market:
If the previous transaction for the purchase was closed by the stop.
Determining the size of trading positions, profit, stop loss be carried out as described above, to open "position to buy".
example of the transaction.
on the chart shows examples of the opening of the first transaction only a "short" and "long".
Examples of the real deal.
We open trading position on the bar, after the price is higher than the exponential moving average EMA, as well as more than the median price a 4-hour bar.
Let us imagine that the bar had not yet fully formed, but only opened. Circled bar - this is nothing but a bar opening trade deal, while the bar, labeled by the Fibonacci - this is the bar, for which we determine the median value. Once the bar has opened at a price of 1.9672, when we open a long trading position, we are introducing these data into a table excel.
Thus, our profit target is at 1.9682. Place a trade order and see what happens. For observation, we use a smaller plot of the trading period.
We have opened a bargain at the price of 1.9672. The price has gone up, so a safety stop-loss has not been activated. After reaching a profit, we are closing 50% of our open trading positions. Price continued to grow. Next 20% of deals were closed with a trailing stop at 1.9682, the remaining 20% ??with a trailing stop at 1.9694, and the final 10% of treling-stop at 1.9690. Ie if you trade standard lots 10.0, your profit on this trade deal would amount to 1,320 dollars, or about 660 dollars for 1 hour trading.
Of course, things are going so well not always ...
Now we consider the example of the transaction, which was closed to foot and rolled in the opposite direction from the first.
So, on a 4-hour chart, we found a candle, which opened over the EMA and also closed above the previous candle. The median price - 1.9782. Make these data into a table in the program excel.
Watch what happens after that:
price reached the level of stop-loss, and follow the rules of this strategy "Boomerang" , the transaction was open in the opposite direction from the first transaction. The new take-profit compensates us old loss of 5 points, plus the goal of the transaction should byt10 points. Thus, the 1st profit target is 15 points. Fortunately, for the second time safety stop-loss has not worked. 50% were closed at a price of 1.9762 (ie, compensation for Stopped + 10 points), second 50% were closed with a net profit of 5 points due to the formation of "spikes" on the chart. Suppose, if you trade 10 lots on the transaction you would earn $ 750 or $ 375 in 1 hour trading.
The same concept of trade on the strategy used for those cases where our open position is closed by the stop, not once, but several. You deploy a trading position in the opposite direction, defining, with new levels of safety stop-loss and profit. During work on the forex strategy has not been the case so that a reversal of 10 attempts were unsuccessful. While such a situation, the forex market and can happen, but the probability is small enough ...
few tips on forex trading strategy Boomerang:
1. You can use the Fibonacci extension tool for measuring the median previous bar - place your levels for maximum and minimum bar and determine if this retracement level of 50%.
2. If your forex broker offers a service Stop and Reverse orders, it certainly can be quite helpful in your work on this strategy (unfortunately, the trading platform Metatrader 4, this feature is not available, but it is quite You can use simple adviser, which is included as standard MT4).
3. After doubling the deposit to recommend him to withdraw the earned PART .
Money management strategies for trading on Forex "Boomerang".
Now I will not give the full course of money management when trading this strategy because this would attach the whole book. But here is an ordinary example of how with the help of a competent and proper money management on the trade account, you can earn enough quickly, using this trading system - "Boomerang".
rule of money management is this: you increase the volume of trade position only when the increase amount of your initial investment in 2 times. For example, if you started trading in 6000 dollars, and trade, for example, a lot, you increase the volume of trading positions on a lot for every earned you the next 6,000 dollars, ie no sooner than when the amount of deposit 12.000, 18.000, 24.000 USD and so on. Assume that your income is only 5 points in the trading day. And in a year of trading days - 220.
If a clear strategy to follow the rules, then something like this will grow your trading in the forex deposit:
After three years of hard work from $ 6,000, and if you increase the number of lots, that's right, as stated above, you can get a million dollars (one million $).