The Naked Stochastic Foreign Exchange Trading Strategy

The naked stochastic foreign exchange strategy is a simple trading strategy that is established only on one MT4 indicator, the stochastic.

It is called “naked” as a result of the crudest and the most fundamental structure of how to exchange the stochastic indicator.

This foreign exchange strategy is appropriate for new forex traders who are just beginning to study about foreign exchange trading and getting to learn how all MT4 foreign exchange indicators react in the market.

Features

  1. All currency pairs should work perfectly.
  2. Suitable for any given timeframe.
  3. Only the MT4 stochastic indicator is required.

Auction Rules

  1. Stochastic indicator must be in the over purchased zone, which is the 80 aligned zone as noticed on the chart instance below.
  2. The two align of the stochastic indicator must bypass in this 80 level zone.
  3. Pause for a bluff reversion candlestick to create and that is your auction signal.
  4. Position an auction stop-loss order two pips beneath the low of this bluff candlestick.
  5. Then position your stop-loss 2 to 5pips approximately the high of that candlestick but if the stop-loss is too to the starting price, then observe for the closest swing high and position your stop-loss a minimal of two pips above it.
  6. For take-gain aim levels, you have two alternatives, target for a risk: reward of 1:2 or more or utilize the prior swing high point as your take-gain aim level assuring that it is more than one is equivalent to two, risk to reward.

Purchase Rules

  1. Stochastic indicator must be in the over auction zone, which is the 20 align zone, please refer to the chart below to observer the alignment I am talking about here.
  2. The two lines of the stochastic indicator must bypass in this 20 align zone.
  3. Pause for the bluff reversion candlestick to create and that is your purchase signal.
  4. Position a purchase order two pips higher up the low of this bluff candlestick.
  5. Then position your stop-loss pips approximately the high of that candlestick but if the stop-loss is too nearby to the starting price, then observe for the closest swing low and position your stop-loss a minimal of two pips beneath it.
  6. For take-gain aim level, you have got two alternatives. Target for a risk : reward or more or utilize the prior swing low point as your take-gain aim level assuring that it is more than one is equivalent to two, risk : reward.

the-naked-stochastic-foreign-exchange-trading-strategy

 

Danger-SignUtilize this strategy at your own risk. WindsorForex.com cannot be responsible for any losses associated with using any strategy presented on the site. It’s not recommended to use this strategy on the real account without testing it on demo first.

 

 

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About The Author

Mike N

Financial Trading Systems Design Expert

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