100 EMA With Parabolic SAR Forex Trading Strategy

The 100 EMA With Parabolic SAR Forex Trading Strategy is a trend trading strategy that as the name says is based on two forex indicators: the 100 exponential moving average and the parabolic SAR indicator.

Currency Pairs you can trade: any

Timeframe: 15 minutes and above would be good.

BUYING RULES

  1. price must be above the 100 ema line
  2. Wait for a Parabolic SAR dot to appear below a candlestick
  3. Place a buy stop pending order 2 pips above the high of that candlestick in step 2.
  4. Place your stop loss 2 pips below the nearest swing low or if that is too far, use the parabolic dot price level (where the buy signal dot appears) also as your stop loss placement price level.
  5. Use previous swing high point as your take profit target level or if not, use a risk to reward of 1:2 or more.

100 ema with parabolic sar forex trading strategy

SELLING RULES

  1. price must be below the 100 ema line
  2. Wait for a Parabolic SAR dot to appear above a candlestick
  3. Place a sell stop pending order 2 pips below the low of that candlestick in step 2.
  4. Place your stop loss 2 pips above the nearest swing high or if that is too far, use the parabolic dot price level (where the sell signal dot appears) also as your stop loss placement price level.
  5. Use previous swing low point as your take profit target level or if not, use a risk to reward of 1:2 or more.

100 ema with parabolic sar forex trading strategy sell setup

DISADVANTAGES OF THE 100 EMA With Parabolic SAR Forex Trading Strategy

  1. both parobolic sar and 100 ema are lagging indicators which means that price precedes them and when they do give you the signal to buy or sell, price usually would have moved a great deal already.
  2. therefore sometimes when you enter, the market may be due for a minor reversal and therefore if your stop loss is too close, you can get stopped out early only to see the market turn and head back in its original direction it was going before.
  3. in a ranging market, you are bound to have some false buy and sell signals with this system.

ADVANTAGES OF THE 100 EMA With Parabolic SAR Forex Trading Strategy

  1. as you can see above that in a strong trending market, this forex system can give you some really good buy and sell signals that are really reliable.
  2. it is a good swing trading system.
  3. the risk:reward of this system is also great in a really good trending market if you use previous swing highs or lows as take profit targets.
  4. simple, easy to understand and follow.

You may also be interested to learn another forex trading strategy similar to this:

100 EMA With Parabolic SAR Forex Trading Strategy

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