Simple Rangebound Forex Trading Strategy

A simple rangebound forex trading strategy with great profit potential. Tools of the trade: Identify important support and resistance levels on the hourly chart or use the Support and Resistance Metatrader 4 Forex Indicator.

Download link:

Click here to download the Simple Rangebound Forex Trading Strategy

Forex Indicators:

Stoch Oscillator (5,3,3)

Support and Resistance forex indicator

How it works

Add the Stoch (5,3,3) oscillator to your chart to pinpoint possible long and short entries in the market.

stochastic-priceaction-fore

1) Wait either for a pull back towards support or a rally towards resistance.

2 a) For long trades: Go long if the currency exchange price touches support and goes back up + positive stoch cross from below 20 (see chart above)

2b) For short trades: Go short if the currency exchange price touches resistance and goes back down + negative stoch cross from above 80.

AUD/USD Buy Trade Explanation

1) AUD/USD price touches a significant support level and goes back up. (AUD/USD holds support)

2) The gray circle indicates the time to go long in the market @ 0.8365 (Stoch cross from below 20)

3) Stop loss is set 3 pips below the most recent level of support @ 0.8314

4) Total trading risk: 51 pips. (entry price – stop loss price)

5) Trade objective: 5 pips below resistance @ 0.8502 ( 137 pips)

RESULT: The AUD/USD long trade was successfully closed for 137 pips the same day.

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