I'm going to describe a very powerful and profitable Price Action Strategy which uses a combination of dynamic and static support
and resistance levels to find potential entry and exit points.
Static SR levels
As you can see, there are 4 SR levels on this chart. Please note that, these are support and resistance levels (or areas) which means we
shouldn't consider support and resistances as a line (or price). These SR levels, divided our chart to separated areas to guide us how
and where have to enter or exit from trade.
Considering above rules, you can find that there are normally 3 to 8 SR levels on a chart. Please have a look again on the above EURUSD chart and check
the rules on that.
<<< If you are still not comfortable to place static SR levels yourself, I created an indicator
that place SR levels perfectly. To get this indicator click on following link >>>
Action Support Resistance Levels >>>
Dynamic SR levels
So far, we have price and static SR levels and we need now dynamic SR levels to complete our tools for this strategy.
But what is dynamic support and resistance levels?
Dynamic SR's are same as static SR's with 1 different. They are not horizontally placed on the charts. They can place like a trend line, channel
or even curve lines.
Actually, unlike static SR levels, placing dynamic SR levels in curve mod, isn't easy and it need a lot of calculating. We need this curve mode
dynamic SR levels for this strategy and for that reason, we use a very functional indicator named Triangular Moving Average (TMA)
indicator. Please have a look on the following chart:
As you can see the two lower and upper bands indicates our dynamic support and resistance levels.
So we now have all 3 tools we need in this strategy: Price, Static SR levels, Dynamic SR levels.
Dynamic Price Action Strategy
In this strategy we have 3 entry conditions. I'll explain the first one in this topic:
Direction Entry Trigger
TMA indicator has a middle line which is showing the current direction of the trend:
After finding direction:
If it was BULLISH, and price hits to one of the static SR levels lower than indicator middle line, it triggers a long position. SL is lower
low around the static SR and TP is next upper static SR or indicator middle line(whichever close to entry point).
If it was BEARISH, and price hits to one of the static SR levels higher than indicator middle line, it triggers a short position. SL is
higher high around the static SR and TP is next lower static SR or indicator middle line(whichever close to entry point).
Please have a look to following charts to get more details:
On the EURGBP chart the indicator shows it's a BULLISH trend, so on the static SR line lower than indicator middle line, we are looking for
a long trigger.
Price is bounces on the line for multiple time, so it's a very good place to enter. SL will be consider some pips lower than lowest low in static
SR level and TP will place on the next upper static SR level.
On the next image you can see a BEARISH setup:
The mid line shows it's a BEARISH trend. So, we look on the static levels upper than mid line to find a proper short trigger and complete our
setup with SL and TP.
There are 2 more setups for this strategy and I created an EA to cover all the setups.
I'll add a signalling system for this strategy on Signals section very soon and inform you in this topic.
Please let me know your questions and share your ideas and thoughts.
No you didn't. Don't attach EX4s
Ok, I removed this indicator, but if someone needs to use it, what should we do?
I tried to upload this one freely on the market, but it needs to recompile with new compilers and I don't have the source code for this
indicator to recompile it.