The Double True Strength Index forex strategy has the ability to generate powerful trading signals on any currency pair, such as the EUR/USD and GBP/USD.
It is composed of an oscillator and trend following arrow indicator.
Let’s get started below with the simple chart setup:
Chart Setup
MetaTrader4 Indicators: TSI_Signals.ex4 (Input Variable Modified; First_R=16, Second_S=10, SignalPeriod=65), TSI.ex4 (Input Variable Modified; Second_S=16)
Preferred Time Frame(s): 1-Minute, 5-Minute, 15-Minute, 30-Minute, 1-Hour, 4-Hour, 1-Day
Recommended Trading Sessions: Any
Currency Pairs: Any pair (Majors, Cross Pairs, Exotic Pairs)
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Buy Trade Example
Fig. 1.0
Strategy
Long Entry Rules
Initiate a buy entry if the following indicator or chart pattern gets put on display:
- If the red line of the TSI custom indicator breaks and hovers above the 0.00 level, price is said to be pushed to the upside i.e. a signal to buy the designated currency pair.
- If the red upward pointing arrow of the TSI_Signals.ex4 custom indicator gets shown on the activity chart, price is said to be pressured upwards i.e. a trigger to go long on the asset of choice.
Stop Loss for Buy Entry: Place stop loss below trading support.
Exit Strategy/Take Profit for Buy Entry
Exit or take profit if the following rules or conditions take precedence:
- If red line of the TSI custom indicator declines to breach the 0.00 level during a buy signal, it is an indication of weaning bulls power, hence an exit or take profit will suffice.
- If the blue downward pointing arrow of the TSI_Signals.ex4 custom indicator pops up on the activity chart during a bullish signal, it is a sign that price is taking a hit and a reversal is imminent i.e. a signal to exit or take profit without delay.
Sell Entry Rules
Enter a sell order if the following holds sway:
- If the red line of the TSI custom indicator breaks and hovers below the 0.00 level, price is said to be taken lower i.e. a signal to sell the designated forex pair.
- If the blue downward pointing arrow of the TSI_Signals.ex4 custom indicator gets seen on the activity chart, the dominant sentiment in the market is said to be bearish i.e. a trigger to go short on the asset of interest
Stop Loss for Sell Entry: Place stop loss above trading resistance.
Exit Strategy/Take Profit for Sell Entry
Exit or take profit if the following takes center stage:
- If red line of the TSI custom indicator rises to break above the 0.00 level during a sell alert, it is an indication of halting bears power, hence an exit or take profit will do.
- If the red upward pointing arrow of the TSI_Signals.ex4 custom indicator pops up on the activity chart during a buy alert, it is a sign that bears are taking a hit and a reversal is in the cards i.e. a signal to exit or take profit forthwith.
Sell Trade Example
Fig. 1.1
Free Download
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About The Trading Indicators
TSI_Signals.ex4 is a True Strength Index signals momentum oscillator that is based on a double smoothing of price changes, and depicts this via the use of its blue/red arrows on the price chart.
The TSI or True Strength Index custom MT4 indicator is a normalized Momentum indicator developed by William Blau.