Forex trading system "15 Min Divergence Profit Strategy"
Added: 2011-04-15 23:17:38 by Dexter
Learn to trade the Divergence Profit Strategy on 15 min
In this article, we look into the stochastic for divergence by comparing the price action and the movement. When traded properly, it can be consistently profitable with divergences. The great thing about divergences is that you can use them as a leading indicator. This makes the risk on your trades are very small relative to your potential reward.
Categories: Technical, Metatrader Only, Divergence
Timeframes: 15 Minutes
Currency pairs: ANY
Trading sessions: ANY
When the stochastic divergence indicator shows a pink down arrow, we open a sell trade at the next open bar. Vice versa, when the stochastic divergence indicator shows a blue up arrow, we open a buy trade at the next open bar as shown in the following picture.
The Stop Loss is set at 10 pips below the recent signal bar which has the arrow. The Take Profit is taken care by the crossing of stochastic in the following exit rules.
We exit sell when the blue stochastic line cross above the pink stochastic line. We exit buy when the pink stochastic line cross below the blue stochastic line as shown in the following picture.
The best thing about divergences is that since we are usually buying near the bottom or selling near the top.
Divergence trading can be inaccurate, so tools such as trendlines, support, and resistance levels could be used to help confirm the trade.
Metatrader 4 chart template files