Tunneling forex strategy is multi-currency (that is, it can be traded on any currency pair), the recommended time interval — from one hour (H1), although if desired can be traded and the interval of 15 minutes, but obviously you have to understand that the signals at small time intervals may give more false signals.
On the chart for the chosen currency pair to set the following indicators forex (they all have a standard set of MT4 trading terminal):
- is exponentially gliding average EMA (18) — Colour the red
- Exponential gliding average EMA (28) — Colour the same way her red
- moving average of Linear Weighted — WMA (5) — blue
- moving average of WMA (12) — yellow
- Indicator RSI (21)
EMA moving averages with periods of 18 and 28 — form a tunnel of the two red lines — they will help you find the beginning and end of a trend.
Moving averages WMA with a period of 5 and 12 will indicate to you as soon as enter into a trend, they also help find the force of the current trend.
Rules of the deal on tunneling forex strategy:
Should open a bargain only when the red tunnel on the graph is strongly narrow or crossed!
Enclose a deal to buy then, as soon as the moving averages WMA with a period of 5 and 12 intersect the resulting red tunnel upwards of two EMA.
If the moving average of the 5 WMA also crosses the 12 WMA moving up — it gives us a particularly strong trading signal.
To purchase the RSI must be above 50.
Conclude a deal to sell if the moving averages of 5 and 12 WMA cross formed by 2 EMA red tunnel downwards.
If the moving average of the 5 WMA also crosses the 12 WMA sliding down, this indicates a particularly strong signal.
For sale, the RSI indicator should be below 50.
Rules out of a trading position:
Trading signals that indicate the end of the trend:
- position to buy: the price on the chart and reached a peak moving average of the 5 WMA crosses the 12 WMA sliding down — you must close a trading position at the current price on the market.
- position on the sale: the price on the chart reached the bottom and moving average of the 5 WMA crosses the 12 WMA moving up — should close a trading position at the current price on the market.
- Should immediately close a trading position as soon as the red tunnel cross the border each other, or as soon as they become very narrow, and perhaps turned into one line! This is a clear sign of a reversal trend.
After the appearance of this signal is close trading position and then back (in the opposite direction).
Until such time as the red line of the tunnel have not crossed each other — should not close an open transaction!
