Impulse Reversal Pattern [author’s model]

Dear friends, considered today Forex strategy «Impulse Reversal», or rather a graphical model or pattern, will be very useful for those who like trading on price models and graphical analysis.

This model allows you to accurately determine the moment of a trend reversal, or at least an attempt to this reversal. Having studied and worked a little with it, you can only use it to make a profit from the market. Of the 10 entries for this strategy, 7 successfully reach the target, which, with a profit / loss ratio of 2 to 1, is very impressive.

Currency pair — any, multi-currency strategy.
Time interval — we recommend using the hourly chart (1H).

Bullish model (buying) forex strategy «Impulse Reversal»:

1) There is a downward movement.

2) There is a not very active upward correction. That is, the candles inside this correction are small, and the price does not deepen upwards. Ideally, the correction does not exceed 50% of the last decline. The maximum of this correction will be designated as point «A».

3) The price shows signs of completion of the correction. Quite a sharp and volatile candle with a black body. Further, the price may go down a little more and even slightly rewrite the last low (point «B»).

4) On a rather sharp impulsive movement (this point is the most important!!!), the price rewrites the last high (point «A») and forms point «C».

5) At the level of point «A», a limit order to buy is set (provided that the price has not passed a distance from it more than a stop loss).

6) Stop-loss is set under the last minimum (point «B»).

7) Take profit is set at a distance twice as large as the size of the stop loss order.

After passing a distance in the positive zone, which is equal to the size of the initial stop order, the deal should be transferred to breakeven.

Bearish model (sales):

1) There is an upward movement in the market.

2) There is a not very active downward correction on the chart. That is, the candles inside this correction are small, and the price does not go down. Ideally, the correction does not exceed 50% Fibonacci of the last advance. The formed minimum of this correction will be designated as point «A».

3) Signs of the completion of the correction appeared on the chart. Quite a sharp and volatile candle with a white body. Further, the price may go up a little more and even slightly rewrite the last formed maximum (point «B»).

4) On a sharp impulsive movement (this point is the most important!!!), the price rewrites the last minimum (point “A”) and forms point “C” on the chart.

5) At the level of point «A», a Sell-Limit order to sell is set (provided that the price has not passed a distance from it more than the stop loss value).

6) In this case, a safety stop loss is set above the last maximum (point «B»).

7) Take profit is set at a distance twice as large as the size of the set stop loss order.

After the price passes a distance in the positive zone, which is equal to the size of the original stop order, the transaction should be transferred to the breakeven point.