By Admiral Markets

Dear Traders,

As you will see in my previous deposit bonus post, it is vital to understand fundamental trading principles when dealing with deposit bonus.

Today where going to take a step above the basics and take an advanced look at how to apply a proprietary strategy that I’ve developed and tested.

This particular strategy is easy to follow and useful for trading with deposit bonus:

…because it allows you to profit on short term gains…

…by aligning both trend and momentum.

It works for me and it can for you too 🙂

Before we start, it’s worth noting that you can use our account projection sheet and advice from the strategy book along the way.

The strategy

So let’s get started.

This strategy is called the MTF Trend Pullback Strategy (MTF TPS ™) and it uses these indicators:

1. Heiken Ashi Candles
2. EMA 30 ( Exponential Moving Average 30.close) – RED color
3. EMA 60 ( Exponential Moving Average 60,close) – BLUE color
4. EMA 100 ( Exponential Moving Average 100,close) -GREEN color
5. Stochastic 14,3,3 ( Stochastic, Simple, Low/High)
6. Daily PP Tarantula’s indicator.

We use the trend on a higher time frame with actual loss of momentum aka retracement to enter the market.

This entry allows you to buy low and sell high.

Buying low and selling high is always safest because you follow the smart money.

Compare it to buying a car for example.

If you want to buy a car, you ask for a lower price and vice versa when selling your car.

The same logic should apply in Forex trading.

A few words on indicators

The MTF TPS ™ strategy uses Heiken Ashi candlesticks because different indicators suit different markets.

Some indicators are best for ranging markets, while other indicators suit flat markets, or suit trending markets.

Heiken Ashi:

…filters whipsaws and shows a clear direction of the price…

…whereas Moving Averages confirm trends and ensure profitable entries.

Pairs, template and timeframe

Pairs: You can trade any pairs with this strategy, but the focus is on major pairs including EUR/USD, GBP/USD, AUD/USD, USD/JPY, USD/CAD and USD/CHF.

Template: You can download a tailored template for this strategy, at the end of this post.

Time frame: H4 and M15 – Multiple Time Frame

Actioning MTF TPS ™

The first thing to do is open an H4 timeframe and mark the trend.

If you are not sure how to do this, let me know in the comments section and I’ll get back to you with instructions.

For long trends, EMAs need to be aligned in the following order:

1. EMA 30 > EMA 60 > EMA 100 ( RED > BLUE > GREEN ).
2. Heiken Ashi candles need to be blue.

For short trends, vice versa:

1. EMA 30 < EMA 60 < EMA 100 (GREEN > BLUE >RED ).
2. Heiken Ashi candles need to be red.

The best trend is when there is a slight space between diverging EMA lines.

If you move your chart to the left, you can always see how the price behaved in the past.

Note that when you see a trend – it means the smart money is moving the market and it is time for you to join.

Remember though, that you only use H4 time frame for marking the trend.

Entry

Once you have determined the trend direction, you move to the M15 timeframe because you will want to cherry-pick the entry.

You want to see pullback towards EMAs on M15 time frame, while the EMAs are still aligned in the trend direction.

For long entries you want to see a change of Heiken Ashi candle color from red to blue, while stochastic is at or crossing from below 20.

For short entries you want to see a change of Heiken Ashi candle color from blue to red, while stochastic is at or crossing from above 80.

Here’s a step-by-step example of a bullish long trade:

1. you have determined that the trend is to the long side
2. now you need to properly time entry – zooming in to M15 timeframe, you want to see the pullback to EMAs and stochastic cross.

Here’s a step-by-step example of a bearish short trade:

1. you have determined that the trend is to the short side.
2. now you need to properly time entry – zooming in to M15 timeframe, you want to see the pullback to EMAs and stochastic cross.

Your targets

Ideally you want the price to reach the next support or resistance level.

For long trades, the target is the next resistance level.

This long target is determined by the indicator, or by using a Profit-Stop technique that I have thoroughly explained in the video below.

For short trades, the target is the next support level – determined by the indicator or by using a Profit-Stop technique.

Stop Loss (SL) to watch for

1. Conservative SL for long trades – below current H4 candle
2. Aggressive SL for long trades – below last M15 high
3. Conservative SL for short trades – above current H4 candle
4. Aggressive SL for short trades – above current M15 candle.

I advise you to watch the video below for additional hints and tips on how to use this strategy.

The video also shows examples of both long and short trades with a proper Stop Loss placement.

I also advise downloading MT4 Supreme Edition if you don’t already have it – as it will greatly empower your trading with this strategy.

I wish you luck in your trading endeavors and welcome your questions or feedback in the comments section below.

Don’t forget to download the template and indicators.

Cheers and safe trading,

Nenad

 
Article by Admiral Markets

Source: How to use proprietary strategy for trading deposit bonus

Admiral Markets is a leading online provider, offering trading with Forex and CFDs on stocks, indices, precious metals and energy.