Support/Resistance on the basis of 240 bars Strategy

Support/Resistance on the basis of 240 bars Strategy

28 November 2017, 14:19
Dragan Drenjanin
0
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This strategy is designed for opening trading positions when the price reaches important levels of resistance or support.

We recommend to use timeframe of not less than H4 for trading.

Levels of resistance and support will be calculated automatically on the basis of the bars and with the help of the indicator ibsSF_TREND_LINES, which can be downloaded at the end of this article. The number of bars can be changed; however keep in mind that their number should not be less than 200.

Trading pairs: EUR/USD or GBP/USD

It is important to maintain proper strategy of risk management, which means that, the ratio of risk - profit should be 1 to 4. Therefore, if Stop-Loss is 20 points, it is recommended to set Take Profit at 80 points.

Sell positions should be opened at the moment when the price reaches resistance level, as shown on fig. 1.  

Fig. 1

Buy positions should be opened at the moment when the price reaches support level, as shown on fig. 2

Fig. 2

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