Stochastic lines crossover

Here is a very basic overview of a role of a Stochastic indicator in the Forex trading. Knowing exactly what to expect from Stochastic, if you ever plan to add it to your own system, will affect trading results dramatically. For this trading method:

Currency pair: Any.
Time frame: Any.
Indicator: Stochastic (14, 3, 3)

Entry rules: Buy when the faster moving Stochastic line crosses above and up over slower moving stochastic line.

Exit rules: Sell when the opposite situation (next crossover) occurs and right after that open an opposite position. It is again recommended, once the first touch of Stochastic lines (possible future crossover) has been spotted, to wait until the following price bar on the chart has closed and only then take actions.




Strategy by Edward Revy