The Fisher Flow Index forex trading strategy spots buy and sell opportunities on any currency pair and timeframe with the help of two simple to understand trading indicators.
The Money Flow Index, a known oscillator that deploys both price and volume to gauge buying and selling pressure, while the Fisher_m11 is a trend seeking indicator.
Put them altogether and we have a strategy that racks in good returns for the investor.
Chart Setup
MetaTrader4 Indicators: Money Flow Index.ex4 (Default Setting), Fisher_m11.ex4 (Inputs Variable Modified; RangePeriod=24)
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
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Buy Trade Example
Fig. 1.0
Strategy
Long Entry Rules
Initiate a buy entry is the following indicator or chart pattern gets put on display:
- If the dodger blue line of the MFI indicator break below the 20.00 level (oversold region) as shown on Fig. 1.0, bear pressure is said to be weaning i.e. a trigger to buy the designated forex pair.
- If the lime histograms of the Fisher_m11 custom indicator gets positions above the 0.00 level (see Fig. 1.0), the general market sentiment is said to be bullish, as such a buy signal will suffice.
Stop Loss for Buy Entry: Place stop loss below short-term support.
Exit Strategy/Take Profit for Buy Entry
Exit or take profit if the following rules or conditions takes center stage:
- If while a buy signal is ongoing, the dodger blue line of the MFI indicator rises past the 80.00 level as depicted on Fig. 1.0, it is a signal to exit or take profit at once.
- If a red histogram of the Fisher_m11 custom indicator gets seen somewhat below the 0.00, it is a trigger to exit or take profit forthwith.
Sell Entry Rules
Enter a sell order if the following holds true:
- If the dodger blue line of the MFI indicator surges above the 80.00 level (overbought region) as seen on Fig. 1.1, bull pressure is said to be halting, hence a sell will suffice.
- If the red histograms of the Fisher_m11 custom indicator gets placed below the 0.00 level as illustrated on Fig. 1.1, the overall market sentiment is said to be bearish, as such a buy signal will suffice.
Stop Loss for Sell Entry: Place stop loss above short-term resistance.
Exit Strategy/Take Profit for Sell Entry
Exit or take profit if the following takes center stage:
- If the dodger blue line of the MFI indicator dips into the oversold region (below the 20.00 level) while a sell signal is ongoing, it is a trigger to exit or take profit straightaway.
- If a lime histogram of the Fisher_m11 custom indicator pops up above the 0.00 level as illustrated on Fig. 1.1, an exit or take profit is duly advised.
Sell Trade Example
Fig. 1.1
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About The Trading Indicators
The Money Flow Index or the MFI is a momentum indicator created by Gene Quong and Avrum Soudack, and it employs both volume and price to measure selling and buying pressure.
The Fisher_m11 on the other hand is a simple histogram indicator that isolates strength and the course of the trend and alerts changes in trend.
Its code is devoid of any typical MT4/MT5 indicator.