The London Session Stop Hunt | Forex Profitable Strategy | Forex Factory

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The London Session Stop Hunt | Forex Profitable Strategy

  • #1
  • First Post: Edited 7:12am Dec 8, 2018 3:55am | Edited 7:12am
Hi,

I don't like when people begin their threads with their life story or whatever... We are here to trade forex and to find profitable strategies right?
Well today i'm finally sharing something i have been trading for a while now, i will try to be as clear as possible but i'm not a native english speaker nor writer so forgive me for any spelling error or if i simply write like shit...

Anyway, straight to the point, the strategy evolves on the 7:00 and 8:00 (1H chart) candles (London UTC time!)
We are going to look for a kind of stop hunt of the 7:00 candle, i'm going to show you a few images that will explain the concept better.

Attached Image (click to enlarge)
Click to Enlarge Name: 11.png Size: 11 KB


As you can see the 8:00 candle breaks the low or the high of the previus candle to then retrace and close on the opposite side, this brings us to a main concept of the strategy, for this to work we need the two candle to be the opposite color, so if the 7:00 candle is bearish we want the 8:00 candle to be bullish and viceversa.

So for a bullish signal we want the 7:00 candle to be bearish and the 8:00 candle to break the low of the 7:00 candle with his wick.

Attached Image


For a bearish signal we want the 7:00 candle to be bullish and the 8:00 candle to close bearish and his wick needs to break the 7:00 candle high.

Attached Image


That's it, the pattern is this...

More considerations:

 

  1. Being this strategy based around the london traders it must be used only on EUR and GBP pairs.
  2. Fridays seems a bad day to trade this.



Take Profit and Stop Loss:
Here comes the though part... There are 2 ways to trade this:

 

  1. 20 pips TP and 20 Pips SL
  2. 100 Pips TP and 100 Pips SL


BUT especially for the second way of trading it, it's important to close the trade with a profit or a loss either at the london session close or at 20:00-21:00 (UTC)

Update: Forex-Jedi Suggestion: relate your TP and SL levels to Average True Range (perhaps daily 5 period?) or any other volatility measure you prefer. (because a fixed TP or SL doesn't take into consideration the market volatility)


Let's see a few recent examples: (1H Chart)

EUR/USD 6 Dec 2018 (+40 Pips)

Attached Image


EUR/USD 28 Nov 2018 (+100 Pips)

Attached Image


GBP/USD 28 Nov 2017 (+70 Pips)

Attached Image


I will update the thread with more infos more examples etc soon... I'm currently posting a video on youtube where i explain the strategy soon it will be available.

This strategy is OPEN to improvements, suggestions etc anybody with any idea on how to improve the strategy please feel free to say it.

We currently have a telegram channel as well where we post analysis and signals to trade, feel free to join us: https://t.me/BeSomebodyFX
BeSomebodyFX
  • #2
  • Dec 8, 2018 4:05am Dec 8, 2018 4:05am
The youtube video where i explain the strategy in detail is us UP on youtube now.

Inserted Video
BeSomebodyFX
  • #3
  • Edited 6:00am Dec 8, 2018 5:28am | Edited 6:00am
Just an observation, you are specifying an absolute value (in pips) for TP and SL, ie 20 pips or 100 pips. However, this takes no account of volatility. 10 pips on one day could represent 1% of the market’s daily movement, while on another day it could represent 10%, therefore using an absolute number will not be in proportion to the market’s movement.

My suggestion would be to relate your TP and SL levels to Average True Range (perhaps daily 5 period?) or any other volatility measure you prefer.

Zoe Fiddes explains this concept well:

Inserted Video
  • #4
  • Edited 7:12am Dec 8, 2018 6:04am | Edited 7:12am
Quoting Forex-Jedi
Just an observation, you are specifying an absolute value (in pips) for TP and SL, ie 20 pips or 100 pips. However, this takes no account of volatility. 10 pips on one day could represent 1% of the market’s daily movement, while on another day it could represent 10%, therefore using an absolute number will not be in proportion to the market’s movement. My suggestion would be to relate your TP and SL levels to Average True Range (perhaps daily 5 period?) or any other volatility measure you prefer. Zoe Fiddes explains this concept well: https://youtu.be/iFLbmaZA7zQ...
That's a very interesting contribution, thanks for sharing your thoughts. (i added your suggestion into the main post)
BeSomebodyFX
  • #5
  • Dec 8, 2018 7:14am Dec 8, 2018 7:14am
Quoting JayRally
Hi, I don't like when people begin their threads with their life story or whatever... We are here to trade forex and to find profitable strategies right? Well today i'm finally sharing something i have been trading for a while now, i will try to be as clear as possible but i'm not a native english speaker nor writer so forgive me for any spelling error or if i simply write like shit... Anyway, straight to the point, the strategy evolves on the 7:00 and 8:00 (1H chart) candles (London UTC time!) We are going to look for a kind of stop hunt of the...
Thanks for sharing Jay..
Just wanna ask you, should we change the trading time when UK (London) entering the DST ?
Coz the start of london market will move forward 1 hour early ?

Regards.
Gambling = 0% skill, 100% luck. Trading = 1% skill, 99% luck.
  • #6
  • Dec 8, 2018 9:39am Dec 8, 2018 9:39am
GBPUSD
Visual backtest for 30 trades. From June 25, 2018 until Dec.7, 2018.
15 W - 15 L
Using 20 SL and 20 TP.
Overall you would lose your spread x 30.

It's been my experience that trying to tweak a losing system into profitability is like putting lipstick on a pig. You'll always have a pig.
  • #7
  • Dec 8, 2018 9:39am Dec 8, 2018 9:39am
[quote=JayRally;11781615]Hi, I don't like when people begin their threads with their life story or whatever... We are here to trade forex and to find profitable strategies right? Well today i'm finally sharing something i have been trading for a while now, i will try to be as clear as possible but i'm not a native english speaker nor writer so forgive me for any spelling error or if i simply write like shit... Anyway, straight to the point, the strategy evolves on the 7:00

Hi.
Said positively .
I assume you enter the trade after the 08-00 bar has closed.
SEE LINE,TRADE LINE..PRICE HAS TO GO SOMEWHERE,,, PRICE WILL GO SOMEWHERE.
  • #8
  • Dec 8, 2018 10:47am Dec 8, 2018 10:47am
Quoting billbss
GBPUSD Visual backtest for 30 trades. From June 25, 2018 until Dec.7, 2018. 15 W - 15 L Using 20 SL and 20 TP. Overall you would lose your spread x 30. It's been my experience that trying to tweak a losing system into profitability is like putting lipstick on a pig. You'll always have a pig.
Will be different if SL 20 and TP 50 ...

Regards.
Gambling = 0% skill, 100% luck. Trading = 1% skill, 99% luck.
  • #9
  • Dec 8, 2018 1:03pm Dec 8, 2018 1:03pm
Quoting Shakka
{quote} Thanks for sharing Jay.. Just wanna ask you, should we change the trading time when UK (London) entering the DST ? Coz the start of london market will move forward 1 hour early ? Regards.
Hey Shakka no just use the tradingview UTC time, or simply find what the London time is and trade the 7:00-8:00 candle of the London time in that period.
BeSomebodyFX
  • #10
  • Dec 8, 2018 1:04pm Dec 8, 2018 1:04pm
Quoting billbss
GBPUSD Visual backtest for 30 trades. From June 25, 2018 until Dec.7, 2018. 15 W - 15 L Using 20 SL and 20 TP. Overall you would lose your spread x 30. It's been my experience that trying to tweak a losing system into profitability is like putting lipstick on a pig. You'll always have a pig.
Hey Billbss, actually GBPUSD is the worst pair to trade with the 20 TP 20 SL because of the high volatility, and anyway yes i know this strategy has a few flaws that's why i'm open to suggestion and improvements.
BeSomebodyFX
  • #11
  • Dec 8, 2018 1:05pm Dec 8, 2018 1:05pm
Quoting billytt
Quoting JayRally
Hi. Said positively . I assume you enter the trade after the 08-00 bar has
...
Correct.
BeSomebodyFX
  • #12
  • Dec 8, 2018 1:53pm Dec 8, 2018 1:53pm
Quoting JayRally
{quote}{quote} Correct.

Thank you...
I think over time and a few tweaks you will have a decent strategy...
Trade well and good luck....
SEE LINE,TRADE LINE..PRICE HAS TO GO SOMEWHERE,,, PRICE WILL GO SOMEWHERE.
  • #13
  • Dec 8, 2018 3:02pm Dec 8, 2018 3:02pm
Aggiungi periodi RSI 2 per avere conferma dell'inversione.
Attached Image (click to enlarge)
Click to Enlarge Name: Capturar.PNG Size: 54 KB
  • #14
  • Dec 8, 2018 6:36pm Dec 8, 2018 6:36pm
Howdy everyone ,,,
If i may ,,,,, i would like to add some constructive comments based on my personal and humble experience ,,,,
BUT ,, my observation are TOTALLY based on price action as i do NOT take into count candle shapes what so ever ,, with all due respect to anyone using them ,,,,
And the reason i say that is cause more often than not ,,, they do NOT do what they suppose to do .
I always look at the 8 AM FRANKFURT time ,,, as there is almost a signal in the price behaviour as what i expect to see follows ,,,
Sometimes the move happens at the 7 AM time ,,
So ,, often the 8AM move ,,, will run the market INTO the Open of Frankfurt ,, which often is a FALSE move ,,,
I use the TMA which is an amazing tool to give me a visual pressure gauge as to what i can expect ,,,
BUT ,,
More importantly ,,, and as i am an intraday TARGET trader and a counter trend trader ,,
i apply ONLY price action filters ,,
like ,,,,
How many pips does that pair have as an ADR ,,,
How many pips have they done leading into the Frankfurt open ,,,
What was the behaviour of price in the Asia session ,,,
and many other filters .
With this approach ,, which is based 100% on price action ,,, and knowing where the TARGETS are ,,,, with NO indicators used ,,, one can achieve 98 to 99% accuracy and consistency .
Hope this helps some .
Cheers,
George
LOVE YOUR GAME WITH A PASSION ,,,,, WORK WITH A VISION ! ! ! ! !
  • #15
  • Dec 8, 2018 11:53pm Dec 8, 2018 11:53pm
Quoting George AUS
I use the TMA which is an amazing tool to give me a visual pressure gauge as to what i can expect ,,, BUT ,, More importantly ,,, and as i am an intraday TARGET trader and a counter trend trader
What is the TMA?
  • #16
  • Dec 9, 2018 12:54am Dec 9, 2018 12:54am
[quote=George AUS;11782318]Howdy everyone ,,, If i may ,,,,, i would like to add some constructive comments based on my personal and humble experience ,,,, BUT ,, my observation are TOTALLY based on price action as i do NOT take into count candle shapes what so ever ,, with all due respect to anyone using them ,,,, And the reason i say that is cause more often than not ,,, they do NOT do what they suppose to do . I always look at the 8 AM FRANKFURT time ,,, as there is almost a signal in the price behaviour as what i expect to see follows ,,, Sometimes the move happens at the 7 AM time ,, So ,, often the 8AM move ,,, will run the market INTO the Open of Frankfurt ,, which often is a FALSE move ,,, I use the TMA which is an amazing tool to give me a visual pressure gauge as to what i can expect ,,, BUT ,, More importantly ,,, and as i am an intraday TARGET trader and a counter trend trader ,, i apply ONLY price action filters ,, like ,,,, How many pips does that pair have as an ADR ,,, How many pips have they done leading into the Frankfurt open ,,, What was the behaviour of price in the Asia session ,,, and many other filters . With this approach ,, which is based 100% on price action ,,, and knowing where the TARGETS are ,,,, with NO indicators used ,,,

I hope people are listening to this good advice, you post well.
I cannot comment on frankie open but the use of adr is a good asset to have.
Trade well.
SEE LINE,TRADE LINE..PRICE HAS TO GO SOMEWHERE,,, PRICE WILL GO SOMEWHERE.
  • #17
  • Dec 9, 2018 2:55am Dec 9, 2018 2:55am
Quoting billbss
{quote} What is the TMA?
It is called TRIANGULAR MOVING AVERAGE i think .
The name is not important ,, BUT used on intraday trading which is what i do ,,, is an amazing tool .
There is a thread on it by a nice gentleman called Al ,,, it is called EXTREME TMA SYSTEM .
I do NOT use the settings suggested on the thread though ,,,,,, due to my deep and detailed analysis and study of price action in relation to the tma . and i ONLY use it on the 1 mnt charts for my entries ,,, and i am able to achieve well over 95% consistency in my entries .
Cheers,
George
LOVE YOUR GAME WITH A PASSION ,,,,, WORK WITH A VISION ! ! ! ! !
  • #18
  • Dec 9, 2018 2:58am Dec 9, 2018 2:58am
Quoting billytt
, I hope people are listening to this good advice, you post well. I cannot comment on frankie open but the use of adr is a good asset to have. Trade well.
.
Thank u for ur kind words Billy ,,,,
I do NOT like to trade based on guessing and hope ,,,
Unless i can have the odds stacked in my favour atleast 95% or higher ,,, i do NOT trade .
Cheers,
George
LOVE YOUR GAME WITH A PASSION ,,,,, WORK WITH A VISION ! ! ! ! !
  • #19
  • Dec 9, 2018 3:33am Dec 9, 2018 3:33am
Quoting George AUS
{quote} It is called TRIANGULAR MOVING AVERAGE i think . The name is not important ,, BUT used on intraday trading which is what i do ,,, is an amazing tool . There is a thread on it by a nice gentleman called Al ,,, it is called EXTREME TMA SYSTEM . I do NOT use the settings suggested on the thread though ,,,,,, due to my deep and detailed analysis and study of price action in relation to the tma . and i ONLY use it on the 1 mnt charts for my entries ,,, and i am able to achieve well over 95% consistency in my entries . Cheers, George
re TMA

Is this because it repaints? do you calculate it then by hand/dot?
life is a reflection of what we allow ourselves to see
  • #20
  • Dec 9, 2018 3:46am Dec 9, 2018 3:46am
Quoting George AUS
{quote} It is called TRIANGULAR MOVING AVERAGE i think . The name is not important ,, BUT used on intraday trading which is what i do ,,, is an amazing tool . There is a thread on it by a nice gentleman called Al ,,, it is called EXTREME TMA SYSTEM . I do NOT use the settings suggested on the thread though ,,,,,, due to my deep and detailed analysis and study of price action in relation to the tma . and i ONLY use it on the 1 mnt charts for my entries ,,, and i am able to achieve well over 95% consistency in my entries . Cheers, George
George, if you're hitting 95% what are you doing here?
You have a bigger edge than the Central Banks.
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