A trend reversal strategy, if done right, has the potential to produce the highest possible yield per trade. is. Imagine being able to ride this new trend from start to finish. This means you can maximize the most pips on that trend.
However, trend reversal setups can also be very difficult to predict. Many scenarios can occur when previous trends begin to collapse. He is just one trend reversal. The market can go into a range just after the previous trend ended. The market may also look like a trend reversal, but suddenly continue the previous trend direction.
For this reason, traders have tried to find ways to identify trend reversals objectively without guessing themselves.
One of the more popular types of trend reversal strategies is the moving average crossover strategy. A moving average crossover strategy assumes that the trend is reversing whenever the moving average crosses another slower moving average line.
The moving average crossover strategy can be very effective with the right parameters. However, many traders have trouble trading this type of strategy as they blindly follow crossover setups without confirmation from other factors.
Binary Comodos is a custom trend following technical indicator originally designed for use in the binary market. However, when applied to other types of tradable instruments such as the forex market, this indicator can still generate trend reversal signals with high probability.
The Binary Comodos indicator is a trend reversal signal indicator based on an underlying Exponential Moving Average (EMA) line.
The indicator identifies trend reversals based on the underlying EMA lines and plots arrows indicating the direction of the trend reversal.
Traders can use these arrows as trend reversal signals and make buying or selling decisions based on them.
The Awesome Oscillator (AO) is one of the most popular oscillators used by profitable forex traders.
This is technically a simple technical indicator based on moving average crossovers.
The AO is calculated by subtracting the 5-period Simple Moving Average (SMA) from the 34-period Simple Moving Average (SMA). However, instead of using the normal closing price of each candlestick, AO uses the median price of each bar. The resulting numbers are plotted as histogram bars.
AO is unique because it can identify both trend direction and trend strength. The direction of the trend is determined by whether the AO is positive or negative, and the strength of the trend is identified by the color of the bars.
A positive green bar indicates a strengthening of the bullish trend bias and a positive red bar indicates a weakening of the bullish bias. A negative red bar indicates an increasing bearish bias and a negative green bar indicates a weakening bearish bias.
Traders can use positive to negative crossings of AO bars or vice versa as trend reversal signals. Traders can also use AO as a trend bias filter and only trade according to the direction indicated by the AO bars.
The Comodos Trend Forex Trading Strategy is a simple moving average crossover strategy based on the crossover of a 10 period Exponential Moving Average (EMA) and a 100 period Exponential Moving Average (EMA).
The 10 EMA line is a very fast moving average line that reacts quickly to price action movements. This moving average represents a short-term trend that moves very closely with immediate price action.
The 100 EMA line is a widely used long-term trend moving average line. A crossover occurring between the 10 EMA and 100 EMA lines can be interpreted as price action starting to break out of the long-term trend.
However, instead of trading all presented crossover setups, we look for confluences based on the Awesome Oscillator and Binary Comodos indicators.
The Awesome Oscillator needs to plot histogram bars that confirm the direction of the new trend.
The Binary Comodos indicator should plot a new trend direction arrow near the point where the 10 and 100 EMA lines intersect.
- 10 EMAs
- Binary Comodos
Preferred timeframe: 30 minute, 1 hour and 4 hour charts
Currency pair: Forex Major, Minor, Cross
Trading session: Sessions in Tokyo, London and New York
- The AO bar should shift to a positive green bar.
- The 10 EMA line must cross the 100 EMA line.
- The Binary Comodos indicator should plot an arrow pointing upwards.
- Enter a buy order at the confluence of these conditions.
- Place a stop loss on the support below the entry candle.
- Close the trade as soon as AO plots a negative bar.
sell trade settings
- The AO bar should shift to the negative red bar.
- The 10 EMA line breaks below the 100 EMA line.
- The Binary Comodos indicator should plot a downward pointing arrow.
- Enter a sell order at the confluence of these conditions.
- Place a stop loss at the resistance above the entry candle.
- Close the trade as soon as AO plots a positive bar.
Not all moving average crossover settings are the same. Some tend to have better win rates than others.
This trading strategy improves the win rate of simple moving average crossover setups by trading only on the confluence of trend reversal signals from two auxiliary indicators, Binary Comodos and Awesome Oscillator.
Given the nature of both indicators that are also based on moving average crossovers, we can assume that this strategy trades at the confluence of trend reversal signals.
Forex Trading Strategy Installation Instructions
Comodos Trend Forex Trading Strategy is a combination of Metatrader 4 (MT4) indicators and templates.
The essence of this forex strategy is to convert accumulated historical data and trading signals.
Komodo Trend Forex Trading Strategy provides an opportunity to detect various peculiarities and patterns in price dynamics which are invisible to the naked eye.
Based on this information, traders can anticipate further price movements and adjust this strategy accordingly.
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How to install Comodos Trend Forex Trading Strategy?
- Download Comodos Trend Forex Trading Strategy.zip
- Copy the *mq4 and ex4 files to the metatrader directory /experts/indicators/.
- Copy the tpl file (template) to the Metatrader directory /templates/.
- Start or restart your Metatrader client
- Choose a chart and timeframe to test your forex strategy
- Right click on the trading chart and hover over “Templates”
- Move right to select Comodos Trend Forex Trading Strategy
- You can see the Comodos Trend Forex Trading Strategy is available on the chart
*Note: Not all forex strategies come with mq4/ex4 files. Some templates are already integrated with his MT4 indicator on the MetaTrader platform.
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