Forex New 2014 Swing Trading System Using Full Stochastic (14, 3, 3)

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Forex New 2014 Swing Trading System Using Full Stochastic (14, 3, 3)

Forex systems which adopt a Stochastic indicator for monitoring the price provide some very good tips about the situation on the market for traders that are willing to see it.

Currency pair:

Any.

Time frame:

Any.

Indicator:

Full Stochastic (14, 3, 3)

Entry rules For Buy:

When Stochastic has crossed below 20, reached 10, and then crossed back up through 20 – set BUY order.

Entry rules For Sell:

Sell when Stochastic has crossed above 80, reached 90, and then crossed back down through 80.

Exit rules:

close trade when Stochastic lines rich the opposite side (80 for Buy order, 20 for Sell order).

Advantages:

gives quite accurate entry/exit signals in well trending market.

Disadvantages:

needs periodical monitoring. Stochastic is suggested to be used along with other indicators to eliminated entering on false signals.

 
riyoforex:

Time frame:

 Any

Last week I tried exactly this on a M5 timeframe, more or less as some kind of scalping (on demo account).

Worked well in Sydney session but in London session it turned faster from overbought to oversold as I was able to generate any profit. As result, I had to wait for the next return and my loss became bigger and bigger.

Wouldn't suggest this on shorter timeframes, at least without other confirmation tools.

 

Trading stochastic on a shorter time frames is not safe at all

Also, stochastic in a ranging period is OK, but in trending periods can kill you in no time at all. It needs some other indicator to avoid that

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