Hi everyone, this is my trade for today on the common sense trading logic using High and Low. If you have been trading, or at least immersed yourself with Forex trading for a while, you should notice that the least volatile period for the majors excluding Yen belongs to the Asian session. During this period, the price action for the Euro and Cable moves like snail and operates within a narrow range. The volatility will come back when it is near the European open and that is where I get ready to aim for a good scalp. Here's how I did it today:


At 0600H GMT, we can determine the Asian High and Asian Low of the Day by then. Today, in case of Cable was at the High of 1.9324 and Low of 1.9268. With the price action moving at a slower pace waiting for the big players to come in, set a buy order at the Asian High and a sell order at the Asian Low of the Day. Setting orders using this method will usually yield at least 10 pips for you without much sweat. As you can see from the chart on GBP/USD, my sell order was hit at the Asian Low and then rallied all the way down to 1.9220. Regarding the take-profit, depending on your lot size, you can opt to take-profit at TP1 or wait later for the hourly candle bar to materialize to take profit at TP2. This depends on your risk/money management. The key point here is to take note of your entry.

Decided to file this as a trading setup since this is one of the methods I use frequently.

Please use the SDX indicator contributed by Big Joe to plot out the buy and sell order price for you at GMT 0500H.

FX Operator

Attached Files

SDX-ZoneBreakout.mq4 (8.4 KB, 2355 views)

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Reminiscences of a FX Operator | Fibonacci Calculator
There is no chance, no destiny, no fate, that can circumvent or hinder or control the firm resolve of a determined soul. - Ella Wheeler Wilcox

nice trapping system, can you tell us about your system performance ?
in one week how many times you've got SL ? do you set limit order in asia session only ?

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Forex Indicators Collection

It can also apply to the US session, but since the Asian market will be closed by then, and the London session is just a couple of hours to call it a day, the volatility is questionable if there's no major US data coming out. It can still work but I've not really traded during that period as my Asian timezone don't allow me to. I would be sleeping by then.

Performance depends on your lot size, if you are speaking in terms of pips, there is a possibility of making at least 10 pips a day if you are disciplined. If your TP is too far away, SL could be hit 1 or two times a week. However, if you set your TP only 10-15 pips away, it is almost non-existence. I think the London session ignores the high and low formed during the Asian session. It usually breaks through their High Lows.

__________________
Reminiscences of a FX Operator | Fibonacci Calculator
There is no chance, no destiny, no fate, that can circumvent or hinder or control the firm resolve of a determined soul. - Ella Wheeler Wilcox

can you explain where should we put SL ? I miss session period separator indi do you have one ?

thanks

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Forex Indicators Collection

I'm using this indicator so you can adjust to your broker server time. The grey area represents 24 hours.

I'm trading primarily on Cable, I set maximum 30 pips SL or at the opposite side of the Asian range, whichever is lower. Move your SL to breakeven if it moves 10-15 pips in your favor. You can enter at 2 lots, exit the first at 15 pips and move the remainder to breakeven, then let the winner runs for the whole day or take-profit at a further point.

Attached Files

$TrillionDollarDaysHML.mq4 (22.7 KB, 1527 views)

__________________
Reminiscences of a FX Operator | Fibonacci Calculator
There is no chance, no destiny, no fate, that can circumvent or hinder or control the firm resolve of a determined soul. - Ella Wheeler Wilcox

Do you wait until the Asian session finishes or is this at the start of the European session? How do you filter false breakouts if your Buy/Sell stop does not allow room to breathe, that is, like maybe 3-5 PIPs away from the highest and lowest?

Ah ok that's a good question I've asked myself before. If the distance from the high to the low is smaller than 20 pips, I will not use this strategy. 20 pips is self-imposed. There are times it worked within that range.

I don't wait for the Asian session to close, I look to enter my orders when the high and low (more than 20 pips in between) are established by 0700H. Like right now, you can actually set a buy order at the Asian High 1.9396 now. The market price is favorable if it is in the middle between the high and low or 25% away from the high and low, then set your orders accordingly.

__________________
Reminiscences of a FX Operator | Fibonacci Calculator
There is no chance, no destiny, no fate, that can circumvent or hinder or control the firm resolve of a determined soul. - Ella Wheeler Wilcox

I think I get what you meant by the 3 or 5 pips further from the H and L. You can do that, but for me, I don't but I do include the spread.

Today you can set the buy order at 1.9396 and the sell order at 1.9320.

__________________
Reminiscences of a FX Operator | Fibonacci Calculator
There is no chance, no destiny, no fate, that can circumvent or hinder or control the firm resolve of a determined soul. - Ella Wheeler Wilcox

which currency pair can use this strategy

Check out the chart attached with the first message. It is for GBPUSD. Also, he does mention "in case of Cable" in his message, which makes it clear that it is for GBPUSD.