breakdown of trend line

Forex Swing Strategy Trade Setup

I hope that you find my post on the forex reversal strategy useful for your trading. In this post today, I shall be sharing with you how to trade the forex swing strategy. The forex swing strategy is a way to profit from the wave movement of the market. If you take a look at […]

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    I hope that you find my post on the forex reversal strategy useful for your trading. In this post today, I shall be sharing with you how to trade the forex swing strategy.

    The forex swing strategy is a way to profit from the wave movement of the market. If you take a look at your forex chart, you will find that the price are always moving in the form of waves and this is exactly what a swing trader is looking for when trading.

    To start this lesson, let me share with you the indicators required for this strategy.

    - Trend Line
    - RSI (relative strength index)

    Now that you know the indicators required, I will share with you the setup for this strategy.

    Do note that we are not going to trade all the swings as most of the swing are very small and therefore do not give us much profit. What we are waiting for is big swing that occurs during London Open and London Close period.

    Step 1: You will have to draw a trend line and wait for the price to break the trend line during the swing back.

    Step 2: Once the price breaks the trend line, you will have to look at your RSI indicator to confirm an entry.

    If you are planning to go SHORT, you will have to make sure that the RSI has crossed below the 50 mark.

    breakdown of trend line

    If you are planning to go LONG, you will have to make sure that the RSI has crossed above the 50 mark.

    breakup of trend line

    Step 3: Upon entering your trade, you will set a stop loss of 25 pips and target profit of 50 pips for the trade.

    Try this strategy out on a demo account first until you are able to execute it properly.

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