Forex Basic Strategies

Holy Grail Forex: Three Successful Strategies

“Holy Grail Forex” is what traders call a successful strategy, which gives virtually no unprofitable trading. To search for the Grail, traders can take many months, even years, but cannot find it. It is very evident that there are no perfect strategies, but if we have the right approach, virtually every strategy can be made into a Grail-like trading system.

Rules for Creating an Ideal Trading System

The strategy should not be overloaded with technical indicators. The “more indicators, better” rule does not work. A professional trader can earn money using simple classic tools (mobile, Bollinger bands, oscillators, etc.) and by combining them correctly.


The trading system is tested in the demo, and then in the account cents with a minimum of 100-200 transactions, setting the main indicators: maximum profit and loss, a series of profitable and unprofitable operations, the relationship between average profit and average loss, etc. During testing the trading system optimizes the configuration of parameters and indicators from the point of view of optimal profitability and moderate risk. If at any time there is an anomaly in the actual trading account of the statistics of the working indicators of the test indicator system, the negotiation stops for the search of the causes.

The success of a trading system depends largely on the psychology of the trader. The key to success is composure, control over emotions, risk minimization, and self-confidence. Don’t be afraid to experiment. I prefer to use combined indicators in strategies, which are built on the basis of modified classical tools. Here are some examples of these indicators, which can be downloaded for free and installed on MT4. The strategies are polished and show good results. The main thing is to comply with risk management rules and not pursue surplus profits.

1. Strategy of “Bollinger Bands and MACD”

Simple channel strategy, the basis of which is a single combined indicator. Its composition includes:

Bollinger Bands is a basic channel indicator that denotes limits, support levels, and resistance. The rupture of the channel limits signals the emergence of a new strong trend, but more often the trend is reversed from the limits of the channel in which the strategy is built.

MACD is a very popular indicator that is used to test the strength and direction of the trend, is built based on moving averages. The combo indicator can be downloaded for free. After downloading the file, it must be copied to the MQL4/Indicators folder. Then, in the “Charts/template” menu, find the template of the indicator installed and run it. Recommended settings for BB_MACD are already listed in the template and cannot be changed without a deep understanding of the indicator principles.

Since the underlying instruments are indicators of volatility, it is best not to use BB_MACD in illiquid currency pairs. I would recommend the classic pair EUR/USD and the timeframe M30. Here the results are better.

Conditions for opening a long position:

-BB_MACD draws red dots below the red line. This can be a single point, but if there are several in a row, it will be a stronger sign.

-After the appearance of the red dots on the next or second candle above the red line a green dot will appear.

-On the next sail, you can open a position.

I recommend Stop Loss at the 10-point level. Exit the market is necessary with the sequence: as soon as you have obtained a profit of 15 points, close half the position, and in the second secure the trailing stop at 15 points and leave on “floating free”. The opening of a short position is completely opposite: a series of green dots must first appear above the blue line, after which a red dot must be drawn below the blue line. On the next candle after the signal, you can open a position.

Tip: If the channel formed by the Bollinger bands visually seems narrow with respect to past periods, the position should not be opened independently of the signals.

2. Fast Trend Line Momentum

Momentum oscillator is included in most trading platforms as a basic tool. Its objective is to measure the magnitude of the price variation of an asset over a certain period by comparing the current price with the price of some periods ago. Fast Trend Line Momentum is a modified impulse, which is not calculated on the basis of the closing prices of the sails, but on the basis of a smoothed trend line. Thanks to this, the curve looks smoother, and the indicator itself gives more precise signals.

Currency pairs -any liquid active, timeframe -1 hour.

Conditions for opening a long position:

-The oscillator draws a consecutive series of 3 or more red columns below “0”. Green columns should not have.

-The last “column” drawn must be located below level -0.002.

-Once the above conditions are met, a green column appears on the chart. The signal will be even more accurate if in the green column the candle is rising.

-Immediately after the green column has been drawn, open a position.

Everyone decides for themselves when to close a position, depending on their appetite for risk and the nature of the market, but I would recommend not to overexposure, closing half at the level of 10 points. The conditions for the opening of sales positions are opposite.

3. Stochastic + JRC + RSI

This indicator combines three basic tools, which are often used in beginner strategies:

-Stochastic oscillator that reflects the level of overbought and oversold of the asset. It is used to identify reversion points.

-CCI is an indicator that shows the overall rate of exchange of quotations of an asset in the market.

-RSI is a relative force index that also helps to identify potential points of trend reversal and the emergence of a new direction.

The simultaneous connection of three oscillators is an indicator, which shows their weighted average, helps to monitor the state of the market. Although exact signals to open the strategy position do not usually occur very often. Currency pairs GBP/USD, EUR/USD, 1-hour timeframe.

I recommend leaving the indicator settings in basic. Note the weight parameter, this is the weight coefficient of each oscillator in the general formula of the indicator, which can be adjusted in the range from 0 to 1. For CCI and RSI, the default value is 0.1.

Conditions for opening a long position:

  • The green line falls below -50.
  • The red line remains above -50.
  • The red line is crossed by the green line from bottom to top.

When these conditions are met, one position can be opened on the next sail. The greater the angle of intersection, the better the signal. If the green line crosses the red line almost in parallel, the signal may be false.

The selling position opens in opposite conditions, but with a level of 50 and with crossing the green and red lines top down. The indicator can be used with other tools, for example, slider analysis or graphics.

Conclusion. These simple strategies are convenient because they are not overloaded with redundant indicators and position opening points are easy to examine. The use of a combined indicator instead of basic 2-3 saves the trader time and simplifies control over the situation in the market. Recommendations for optimizing strategies:

Determine the time when strategies give more frequent and accurate signals.
Do not negotiate on these strategies in flat and at the time of publication of the news.
If the strategy gave 3 consequential unprofitable signals, take a breath or change settings.


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