The "Stochastic for GBP/JPY" strategy: minimal risk with a significant profit
The strategy "Stochastic for GBP/JPY" is used to trade on the currency pair GBP/JPY and uses Stochastic and RSI indicators, as well as analysis of candlestick patterns.
Input parameters
- Currency pairs: GBP/JPY
- Timeframe: H1
- Trading hours: any
- Type of strategy: trending, indicator
Used indicators
Opening a long position
Entry into a long position is made in the presence of a strong downtrend, the line Stochastic indicator is below level 20, the RSI indicator line is below level 30. The prerequisite for entry is a bullish candle, which must close in the middle or above the previous candle.
Opening a short position
Entry into a short position is made in the presence of a strong uptrend, the line indicator Stochastic is above level 80, the line indicator RSI - above level 70. A necessary condition for entry is the presence of a bearish candle, which should close in the middle or below the previous candle.
Position management
Exit a long position is carried out at the transition from the oversold zone in the overbought zone, when a bearish candle appears. Closing at half or below the previous candlestick.
Exit a short position is mirrored.
It is recommended to put a stop loss of 100 points. Despite the large size of the stop, according to the authors of the strategy, the filtering of market noise, combined with the high reliability of oscillator signals, given the change in trends, minimizes risk and allows you to get a tangible profit in each trade.
According to ForTrader.org experts, the strategy "Stochastic for GBP/JPY" can be used only in conditions of a pronounced trend movement. It can be used on other trend pairs with the introduction of additional filters to the strategy.