Fib+5WMA

I am starting this thread to share this strategy with all other members, and also want to make it more powerful and successive method with the help of other’s.

I am using this strategy and got good results so far. This is not basically my own method, I got it from some other link written by Mr. Edward. I really appreciate his work and efforts to teach other’s and make them good traders.
Let’s move to the setup.

Trading setup:
Time frame: M15-M30-H1
Currency pairs: any.
Indicators: 5 WMA

Rules:


First Look for recent swing high / low to draw Fibonacci. Always draw in the direction of the trend. I use 50 SMA to determine the trend direction for M 15 chart. If price is above 50 SMA it means bullish if below it means bearish.

After drawing Fibonacci AB wave in the direction of trend wait for the retracement.


For retracement there are some rules to follow:

 

1. The price must touch 5 WMA.
2. The price must at least touch 0.382 Fibonacci retracement level.
3. The 0.618 Fibonacci retracement level must not fail.

Entry:

After the rules look for valid retracement level.

Buy when after retracement candle clearly close above 5 WMA.
Sell when after retracement candle clearly close below 5 WMA.

Stop order
Always place stop loss 5 pips above / below 61.8 level.
When taking 61.8 retracement use stop loss at 5 pips above / below 78.6.

Profit target
I use FE 100.0 for TP 1 and FE 161.8 for TP 2.
You can also set your profit target at FE 127.0.

Note:
Always risk only 2-3 % of investment.

All comments and suggestions will be appreciated.
If anybody has tips to make it more successive then please share.

Participation of Users:

On the suggession of Freedomsg i am adding a Indicator called G7, it can be used to identify the trend direction. When 1 pair is above +1 it is strong and when one pair is -1 it is weak so then we start look for setup on that pair. I attach a chart and try to describe everything.

Charts:
I am posting my recent Eur/usd, Eur/Jpy charts to show the entry points and profit targets, on my charts blue line is 50 SMA and white line is 5 WMA vertical line is showing entry point. On second chart of eur/usd, eur/jpy both showing profit targets hit and also showing next valid wave setup in red color.

The above is the only thing I see wrong with it. It makes it too discretionary.
There are usually several swing high/ lows you can draw your fib to. Some will qualify an entrance, some won't.
Can you narrow down the rule as to which one to use?

Thanks

Every trader has own way to draw fibonacci, i m showing the setup only that has reached to the profit target points.

You can use any recent swing AB wave that is not retraced to 38.2 if it is valid and then look for retracement. On my charts you can notice after waves in red colour fibs there is recent swing high / low which can be use for next setup if holds.

What definition of "swing high/swing low" are you using?

A three candle pattern or a five candle pattern?

I use simply fractals to get any good and strong wave for any setup. If you mark valid swings on your chart thn you will get many simple fibonacci setups. My method is not so different from simple use of fibonacci, it just consist 5 WMA to filter the entry remaining is simple use of fibonacci.

Here is picture showing swing high / low. i hope it will hellp.

Hi Pip26, why not we add in this G7 indi? Orginal from Wjqblog post and i think it is a good tool in the 15 mins TF.Cheers

Hello freedomsg,

Thanx for your idea,i think you are right we can use it to trade only trendy pair.
Good add it.

Thanx for your participation.

Here is Eur/Usd M15 setup, I also add ADX 14 for experiment. I think when we get our signal candle and at the same time if ADX is above 25 then we can get strong entry.

v.good method!

adx here is declining on your example... maybe adx could help us with adding more to position (near 61 FE on your last chart)?

Recent setup for Eur/Usd...

Setups for Gbp/Usd, Gbp/Jpy...

Here goes my morning high probability setup trade using this method. I like to keep it short and sweet so my exit is usually just 10 pips from my entry...

Gbp/Usd, Gbp/Jpy both gone to hit stop losses,

May point is here to figure out why we should not take these trades. Or how can we avoid bad signals.

Please post your comments and sugessions.....

Hi Pip, I attach the G7 Indi from Wjqblog. The indicator pataments set "6303590". And IBFX MT4 cannot be use, I am using FXDD platform right now. Hope this indi can show us a good setup.

G7-usd is a pairs stong weak indicator

I use this tool

traing very strong and very weak pairs


a line = a pair
red=jpy
white=usd
yellow=aud
blue=gbp

purple=chf

green=cad
pale=eur

Thanx freedomsg will keep using it.

Today's setups for Gbp/Usd, Gbp/Jpy

Recently setup with good potential..

Eur/Jpy setup