Simplest and easiest trading strategy

A simple method which doesn't require any analysis or indicator:
Open a trade in the direction of the daily candle any time during the day in your own time zone. Don't put a limit. Put a stoploss equal to the length of the candle. If the candle is too short take previous two candles for reference. Next day whenever you get time (no fixed hours) check the trade. If the trade is going in your favour leave it running, only adjust the stoploss to the new candle length. If the trade is going against you, immediately close and reverse it with similar settings. This can also be done using a weekly candle on a weekly basis. The idea is to ride the candle into the trend. A visual backtest on usd/jpy, usd/chf, aud/usd charts shows good results. Start with mini lots catering for whipsaws and have patience. Chose trendy pairs, avoid eur/gbp, gbp/chf, usd/chf.

This strategy makes perfect sense..

I will look check it out.

I love simple price action

keep this thread alive!!!


thanks for sharing

Check "TKimble's" "Daily Scalping",The bad news is that this approach doesn't work in the long run.I know as I've tried for the last 7 months and all I've achieved are consistent losses.

Read also Steviets thread. He started using this system, with five pairs, at the beginning of this year. He was very succesful during the first months and made an incredible amount of pips, following a very wise and conservative MNoney mngmnt strategy. By mid year his system had lost its magic and he was giving back all the pips he had won before. He has changed completely his strategy and nowadays he is an amazingly succesful scalper.

Conclusion: this system may work when you are lucky and ride the trend....but will take it away from you when it starts to range.

It has been done before!!!!

edge540,alcastro,
The idea I presented is definitely an original one. I couldn't get to Steviets concerned thread but going through TKimbles 'Daily scalping' found it does resemble my proposed system in essence, but with good differences, like closing a trade every dayend, considering three similar candles in a row,the stoploss point etc. Also as I said, one has to be prudent in selecting the pair to trade and one has to have patience with this system. As the saying goes 'A cat which has burnt itself accidentally sitting on a hot plate will never sit even on a cold plate'. Given that there is no holy grail in forex, one can of course make use of common sense (and the charts in this case) and this is what I have tried to do.
Happy trading whichever way you do it!

I've done a little back testing using similar strategy about 2 months ago. I've used Excel to back test, importing data from MT4. I don't remember my back testing period for the moment; maybe it was about 1-year period.

Overall, the result was positive for most of the pairs I tested. I believe it was negative for USDCHF, which IMHO, has a rather trend less behavior.

One improvement that I have in my mind is to trade only in direction of main trend, i.e., taking trades in direction of 10SMA or 20SMA. This is what I like to experiment and back test in near future.


keep this thread alive!!!


regards,
SHR

SHR, With due regards for your idea of including MAs to trade the system, I would suggest follow the candle alone, which is a more sure indicator of where the pair is going. A few whipsaws (sometimes more), but IMHO it would eventually take you where you want to go. Again I would say patience is the key in this system.

Thanks for your reply. Of course that was my humble opinion to avoid whipsaws during retracement/consolidations periods (as far as possible), which I believe is the most difficult part for these kinds of strategies.

Anyway, I'm very interested in these type of strategies on the daily time frame and I'll follow this thread eagerly.

maybe would be interesting to do it in a multi timeframe way... for example.. only entering the trades in the direction of the last weekly bar. just an idea.. didn't test it.

emda, You could try experimenting. Gazing at a naked candle daily chart can give you new insights. This system like all others is supposed to be a food for thought. Nothing is absolute in the fx game. Some variations may include:
1) Going stop and reverse after a 100 pip loss instead of waiting for end of day.
2) Starting with mini lots and doubling up at the stop and reverse point as mentioned in 1) until entering the pip positive zone.
Other experienced traders may come up with better suggestions related to the basic idea of following price action with the candle alone. ... cheers

i like your system, but you need to have a good Money Managment to make it work. i have thought of this ideal before and find that i will get wipsaw to death when it range. so how?? i found a thread from Bull rock on "Three Bar Scalp Method w Probability " it is quite similiar and Bullrock is post his updated system soon. watch out for it. just MHO

Can you show an example please. I think i follow what you're saying but in using the length i'm either tired or missing something here.. love the simplicity concept as that is what life is all about so why do we complicate things.. i'm just mssing this now .. Appreciate it..