A simple day trading strategy that works in any timeframe and produce consistent profits – that is what every trader are looking for.
When looking at day trading strategies for beginners and even more experienced traders there are a multitude of different day trading strategies to choose between. It can be trend following, reversal or breakout trading that can all form the basis of successful day trading strategies.
What I have learned through years of experience is that the simpler the day trading strategy is – the more successful it will be .Many forex traders end up looking at far too many screens as well as indicators, and often get “analysis paralysis” and end up not taking a successful trade or worse – losing money.
Here is a proven day trading strategy that works in any timeframe as well as with tick and range bars. I prefer the 15 and 30 minute timeframes which work very well.
- Place the following exponential moving averages on your chart – 8, 20 ,50
- What you are looking for is for certain conditions to be present in the market – namely a strong trend .This can be easily identified when there is angle and separation between the 20 and 50 moving averages.
- When a strong trend is present you wait for a pullback of price to the 20 period moving averages, and when price breaks the 8 period moving averages again in the direction of the trend you enter the market.
- Your stop loss can be just behind the 50 period moving average
- Take your profit at anything from 20 to 50 pips.
This simple forex day trading strategy works very well if you stick to one simple rule namely;
Do not trade when the moving averages are flat and there are no angle and separation between them.
This accomplishes the simple thing in that it keeps you from trading when there is no trend and direction in the market. Your odds of successful trades go up considerably when you only trade in a trending market.
Many traders lose a lot of money when they try to trade in a directionless market, and this strategy will keep you out of the market in such conditions.
Trending currency pairs like GBP/USD, EUR/USD, EUR/JPY is a very good fit for this day trading strategy, and as always only trade when the big forex markets like London and New York are open.
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