This is my 2nd Simple but profitable strategy . Please check my 1st Trendline Breakout Strategy Thread for Gold here http://www.forexfactory.com/showthread.php?t=483424
I use this strategy on Gold due to many reasons. Gold moves 900 to 1500 pips per day. No need to run for many currency pairs. If you do analysis for 4 major currency pairs then you will need lot of time and you will get few pips. If choose only one Gold pair then You can make more than 200 pips in single day.
Trendline and Divergence Both strategies are very simple and profitable. Please practice my both stratgies and then I will combine both strategies to create a very powerful complete system . I want people learn step by step especially beginners.
The people who are new to Divergence please read this very best post about Divergence http://urbanforex.com/forum/topics/d...ource=activity
I will use same Customized MACD Indicator which I also use in Trendline strategy . It is very powerful indicator. I want things very simple.
There is Two type of Divergence
1. Regular Divergence
2. Hidden Divergence
1. Regular Divergence
Regular Bearish Divergence
Always for look Bearish Divergence in up trend
In uptrend connect always connect Lower High and Higher High with use of MACD . If MACD shows Downtrend then there is divergence. Look at Image.
After Divergence Price went short .
Regular Bullish Divergence
Always for look Bullish Divergence in Down trend
In Downtrend always connect Higher Low and Lower Low with use of MACD. If MACD shows uptrend then there is divergence. Look at Image.
After Divergence Price went Long .
2. Hidden Divergence
Hidden Divergence is very powerful than Regular Divergence. Once you find Hidden divergence you can get lot of pips. Before going to Hidden Divergence I want remind again about Regular Divergence. We find bearish regular divergence in up trend and bullish regular divergence in down trend. Please practice it .
Now let me explain about Hidden Divergence. It is opposite to regular divergence and we only can find it within the trend that's why it is very effective.
Bearish Hidden Divergence
Once we find a Lower High in Down trend but MACD shows Higher High ( Remember in Bearish Regular Divergence once we find a Higher High in price and MACD shows lowe high )
So this mean Trend is continue to down and we will enter the trade.
Bullish Hidden Divergence
Once we find a Higher Low in UP trend but MACD shows Lower Low ( Remember in Bullish Regular Divergence once we find a lower low in price and MACD showshigher low )
So this mean Trend is continue to up and we will enter the trade.
Entry Exit Rule No.1
You can enter trade after closing of the candle very next to the candle( which made high or low in price)
Stop Loss: Stop Loss will be placed at above the High candle , if market has volatility then add more 5pips in SL so it will be 5 above the high candle.
Exit: Put target as 1:1 ratio if market has less volatility then target will be 10 pips.
Entry Exit Rule No.2
Put Stop Loss as mentioned in Rule No.1 and Target will be next support or resistance level but make sure you are in the direction of trend.
Entry Exit Rule No.3
Using this Rule you can earn lot of pips.
Stop Loss: Put stop loss as mentioned in Rule No.1
Target: Once You price reaches at 10 pips profit you have to close half lot . Put trailing stop or make target next support or resistance area. But remember you have to move your Stop Loss at Break Even .
Entry with Trendline
You can also enter by drawing of a simple trendline( withour MACD RULE). Once candle close below the trendline then you enter. Look at example
Please practice this on 5 Min Gold ( XAUUSD) and give me reply ..
Download MACD and make settings on 5 Min chart as ( 1 , 13 , 1 ) Note: You can also use Default settings. It is upto you which one better work for you.
Thank You
Always try to look divergence at Support and resistance areas or daily Pivots.
Beginners try to find in Google how to draw support and resistance, If can't then insert Daily pivot indicator on chart . If price reaches at any Pivot line and shows divergence then it can be very effective.
I use this strategy on Gold due to many reasons. Gold moves 900 to 1500 pips per day. No need to run for many currency pairs. If you do analysis for 4 major currency pairs then you will need lot of time and you will get few pips. If choose only one Gold pair then You can make more than 200 pips in single day.
Trendline and Divergence Both strategies are very simple and profitable. Please practice my both stratgies and then I will combine both strategies to create a very powerful complete system . I want people learn step by step especially beginners.
The people who are new to Divergence please read this very best post about Divergence http://urbanforex.com/forum/topics/d...ource=activity
I will use same Customized MACD Indicator which I also use in Trendline strategy . It is very powerful indicator. I want things very simple.
There is Two type of Divergence
1. Regular Divergence
2. Hidden Divergence
1. Regular Divergence
Regular Bearish Divergence
Always for look Bearish Divergence in up trend
In uptrend connect always connect Lower High and Higher High with use of MACD . If MACD shows Downtrend then there is divergence. Look at Image.
After Divergence Price went short .
Regular Bullish Divergence
Always for look Bullish Divergence in Down trend
In Downtrend always connect Higher Low and Lower Low with use of MACD. If MACD shows uptrend then there is divergence. Look at Image.
After Divergence Price went Long .
2. Hidden Divergence
Hidden Divergence is very powerful than Regular Divergence. Once you find Hidden divergence you can get lot of pips. Before going to Hidden Divergence I want remind again about Regular Divergence. We find bearish regular divergence in up trend and bullish regular divergence in down trend. Please practice it .
Now let me explain about Hidden Divergence. It is opposite to regular divergence and we only can find it within the trend that's why it is very effective.
Bearish Hidden Divergence
Once we find a Lower High in Down trend but MACD shows Higher High ( Remember in Bearish Regular Divergence once we find a Higher High in price and MACD shows lowe high )
So this mean Trend is continue to down and we will enter the trade.
Bullish Hidden Divergence
Once we find a Higher Low in UP trend but MACD shows Lower Low ( Remember in Bullish Regular Divergence once we find a lower low in price and MACD showshigher low )
So this mean Trend is continue to up and we will enter the trade.
Entry Exit Rule No.1
You can enter trade after closing of the candle very next to the candle( which made high or low in price)
Stop Loss: Stop Loss will be placed at above the High candle , if market has volatility then add more 5pips in SL so it will be 5 above the high candle.
Exit: Put target as 1:1 ratio if market has less volatility then target will be 10 pips.
Entry Exit Rule No.2
Put Stop Loss as mentioned in Rule No.1 and Target will be next support or resistance level but make sure you are in the direction of trend.
Entry Exit Rule No.3
Using this Rule you can earn lot of pips.
Stop Loss: Put stop loss as mentioned in Rule No.1
Target: Once You price reaches at 10 pips profit you have to close half lot . Put trailing stop or make target next support or resistance area. But remember you have to move your Stop Loss at Break Even .
Entry with Trendline
You can also enter by drawing of a simple trendline( withour MACD RULE). Once candle close below the trendline then you enter. Look at example
Please practice this on 5 Min Gold ( XAUUSD) and give me reply ..
Download MACD and make settings on 5 Min chart as ( 1 , 13 , 1 ) Note: You can also use Default settings. It is upto you which one better work for you.
Thank You
Always try to look divergence at Support and resistance areas or daily Pivots.
Beginners try to find in Google how to draw support and resistance, If can't then insert Daily pivot indicator on chart . If price reaches at any Pivot line and shows divergence then it can be very effective.
