Strategy on ZigZag signals

This is a good trading strategy based on redrawing indicators. It would seem that it does not happen ... But you try it!

Trading strategy indicators

Non Lag Zigzag: Price 0, Length 100, PctFilter 2.0.

Zigzag Pointer: ExtDepth 100, ExtDeviation 75, ExtBackstep 15.

Trading signals

Good signal to buy: The arrow points up and the zigzag line is touched.

 Strategy on ZigZag signals

Good sell signal : The arrow points down and the zigzag line is touched.

 Strategy on ZigZag signals

Exiting a position is done in one of two cases:

1) There is a new rollback zigzag.

 Strategy on ZigZag signals

2) There is a signal to open in the opposite direction.

 Strategy on ZigZag signals

False signals strategy

Do not trade if one of the following events occurs:

- There is no arrow, but there is a ZigZag line;
- There is no zigzag line, but there is an arrow.

 Strategy on ZigZag signals    Strategy on ZigZag signals

Signal confirmation

The use of multiple time ranges. The author of the strategy suggests using 3 charts for confirmation. You can limit yourself to the hourly range, but it is better to use the 4-hour time frame as well. When you see signals on all three charts, it is a very strong indicator of the trend direction.

 Strategy on ZigZag signals
 Strategy on ZigZag signals
 Strategy on ZigZag signals

Exit and Stop Losses

It all depends on the currency pairs. For example, if you trade on an hourly chart of GBP/JPY, it is recommended to use stop loss at least 75 pips. If you trade the same pair, on the 4-hour chart, you can use a stop loss of 200 pips. For exits, you can use either the next signal or a predetermined profit target. You can also use the MFI to assess the oversold/oversold nature of the pair.

Your profit to risk ratio should be at least 2:1. Never risk more money than you can win.

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