The strategy forex DOSR, trade is the currency pairs: EURUSD, GBPUSD, GBPJPY, a 5-minute time interval (M5), while analysis was performed on day interval with DOSR mq4 indicator forex trading terminal for MT4 or independently.
Full name of forex strategy — The Daily Open Support and Resistance Technique, which translates as «Technical Trading support and resistance, defined in the daylight opening».
Identify support and resistance levels on the last trading day candle.
Open the timeline and go on a daily time frame.
Option 1 — Bullish candle (closing prices of the candles above the opening level of the candles).
You should not pay attention to the daily minimum, and the closing price of the candle.
Maximum of the day at 0.6733.
The opening price of the day at 0.6684.
Carry out a horizontal line through the maximum (resistance at 0.6733) and through the opening (support at 0.6684).
Option 2 — A bearish candle (the closing price of the candles below the opening level of the same candles).
You should not pay attention to the daily maximum, and the closing price of the candle.
Opening at 1.6276.
At least at the level of 1.6212.
Carry out a horizontal line through the opening level (resistance level at 1.6276) and a minimum (support level at 1.6212).
Entering the market in and out of the market for forex strategy DOSR.
The deal to purchase:
Go long trading position as soon as the 5-minute candle crosses and closes above the resistance level specified by us.
The deal to sell:
Open short trading positions, as only 5-minute candle crosses and closes below a certain level we support.
Safety stop-loss
Closing the trading position as soon as the closure of a 5-minute candles than we have defined the stop-loss. For example, if your safety stop-loss orders for the currency pair EURUSD is 20 points and closing candle breaks this level, then we close the trade deal must!
Take-profit (profit target):
In this strategy, forex DOSR risk / reward ratio is 1:1, that is, if your safety stop-loss is 20 points, then the profit target should be 20 points. If you wish to make, for example, 2 times more, then you need to increase the size and position to be opened 2 times. After achieving the first goal for the take-profit at 20 pips, move the safety stop-loss order to break even, to let profits run, but will be quite logical to use a trailing stop.
If you are limited in their trading at the time — do the following:
Trading position to buy: Set aside an order to buy at a certain resistance to the previous day candle with a stop-loss and take-profit.
Trading position for sale: Set aside an order to sell at a certain level of support for the previous day candle with a stop-loss order and take-profit.
Recommended values of stop-losses and profit targets for the currency pairs:
- EURUSD — 20 points
- GBPUSD — 30 points
- GBPJPY — 50 points
Example trade forex strategy DOSR on the currency pair EURUSD:
1 st red oval — in this case was not open trading position on the sale, although the price on the chart and reached the level of support for the previous trading day at 1.3117, as happened close below the minimum. Opening of trading positions occurred a little later, as soon as the next price move down, she crossed the level of support and closing a 5-minute pricing candle fell below this level. After that, the market price has gone down, as expected, and up. The result has been achieved the level of stop-loss order, but candle closing above this level did not happen, so the trading position is still open. Next 5-minute candle was directed downward, and the price is soon reached the level of TR. Trading position was closed with a profit of 20 points.
This forex strategy — DOSR differs from the traditional strategy of Forex «breakdown of the high-low the previous day» in that it provides the best entry point into the market (although it is slightly more risky). But given the fact that sometimes between the maximum and minimum distance is sufficiently large, then you when trading on the traditional forex strategy, missing potential points of profit, and with this strategy forex you can earn a lot more pips.
