Forex Strategy Vegas-Wave

A Forex strategy Vegas-Wave works with the one hour interval (H1) and uses the following signals for opening trading positions: The basics of the Elliott Wave Theory and signals from exponential moving averages (EMA 144 and EMA 169) which form price chart channels. We recommend choosing dealing centers with a Metatrader 4 trading terminal for trading. The exponential moving average 144 has one significant special feature: it is a perfect support for price at when there is movement that shows a long and strong trend. If price crosses the exponential moving average EMA 144, it means that a market trend is going to change its direction and move in the opposite direction. If you use these 2 features of EMA 144 skillfully and add some extra filters on the basis of a trading system, you can use the resulting system as a profitable, logical and relevant trading system. Market entry signals will be a crossing of a price channel, formed by two moving averages (EMA 144 and EMA 169). Formation of a fractal on the market will be a filter for the conclusion of a transaction; we will place a pending order on breakout of this fractal. We will take signals for profit-taking in the Elliott Wave Theory, and using Fibonacci levels and extensions, measured off the 1st Elliot wave on the current market trend. Nevertheless, it is impossible to apply a common pattern to the Forex market, so there will still be unprofitable transactions using the Forex strategy Vegas-Wave, as we will enter the market at points other than the beginning of a trend movement. But trading statistics for this strategy says that, one way or another, there are 3 times more profitable transactions than unprofitable ones. And this is a very big advantage for this Forex strategy! Trading Principle Using the Forex Strategy Vegas-Wave Moving averages 144 and 169 form a channel on a price chart. If price is above this channel, this area is called a buy-zone, and if price is below this channel, this area is called a sell-zone. Trading Signals for Buying

We look at the chosen price chart: if a candle breaks through the channel of 2 EMAs and closes above this channel or directly in this channel (between 2 moving averages) on the H1 interval, we need to wait for a fractal to form on the chart. This fractal will be the filter for placing a pending BuyStop order (potentially 1 in 5 candles of the given fractal should close either above or in it.) When trends change, a simple fractal, which broke through one of two moving averages of the formed channel (not taking into account closed candles), can be a signal. So all you need to do is to wait for a retracement impulse for a buying transaction to form and place a pending BuyStop order on a breakout of the given fractal plus taking into account filters plus spread size. A stop-loss order should be placed on the opposite side of the formed channel behind the peak of the first wave (the local minimum), or behind the previous fractal, if you didnt enter the market at the beginning of a market trend reversal. Trading Signals for Selling We refer to the chosen price chart and if a candle breaks through the channel of 2 EMAs and closes below or directly in this channel (between 2 moving averages) on the H1 interval, we need to wait for a fractal to form on the chart. This fractal will be the filter for placing a pending SellStop order (potentially 1 in 5 candles of the given fractal should close either below or in it.) When trends change, a simple fractal, which broke through one of two moving averages of the formed channel (not taking into account closed candles), can be a signal. So all you need to do is to wait for a retracement impulse for a selling transaction to form and place a pending SellStop order on a breakout of the given fractal plus filter. A safety stop-loss order should be placed on the opposite side of the formed channel behind the peak of the first wave (the local maximum), or behind the previous fractal, if you didnt enter the market at the beginning of a market trend reversal. Forex Strategy Vegas-Wave Trading Rules 1. A buy-zone is situated above the channel, formed by moving averages, with a corresponding sellzone situated below the same channel. A pending order is placed on a breakout of the first fractal above or below the channel, formed by moving averages. A safety stop-loss order is placed either above or below the beginning of the first Elliott wave. If you dont enter the market at the first wave, a stop loss is placed behind the previous fractal, which is situated at the opposite side of the formed channel. 2. The size of a trading position should be divided into 2 equal parts.

3. Rules for profit taking: a) The first part of a transaction you should take profit either at 262% Fibonacci extensions from the size of the first wave or at the end of the third Elliott wave b) The second part of a transaction you should take profit either at 362-424% Fibonacci extensions from the size of the first wave or at the end of the fifth Elliott wave c) If a trend in the third wave is strong enough, you should take profit of first 50% of a transaction when a price movement stops. As a rule, it happens at 300-338-362% Fibonacci extensions from the size of the first wave d) When trading on the basis of the wave structure, you should also take into account lower wave levels or, in other words, Elliott waves on intervals 15-30, to determine take profit levels more accurately e) If you enter a transaction at the fifth Elliott wave, the first part of profit is taken on 362% Fibonacci; at the same time, you should also specify the take profit area for lower wave structure f) Having taken the first 50% of profit, you should place a stop-loss order at the break-even level for the second part of the opened lot 4. Stop-loss is also placed at the break-even level behind the formed retracement level after the peak of this price movement has been broken through. 5. There is a possible variant for taking profit for the second part of the opened lot and this is to use a trailing stop for previous fractals, opposite to the movement. This is if the first part of this lot has already been taken at the Fibonacci level 262% or 362% from the first Elliott wave. 6. You should also take into account a time filter for opening transactions on EURUSD and GBPUSD currency pairs. I.e., you should place orders from 8:00 to 18:00-19:00 terminal time (i.e. approximately from 7:00 to 17:00-18:00 GMT). 7. You can place orders for EURUSD and GBPUSD after 17:00-18:00 GMT, but in this case you should take the market situation into account. Dont place pending orders before 7:00 GMT! 8. If a market trend has ended, you should take into account a time filter for market entry (for example, the trend lasted less than a week). This will be at least 2 trading days after the trend ends i.e., orders are not placed. 9. Pending orders for currency pairs of cross-rates: GBPJPY, EURGBP, GBPCHF can be placed at any time in a trading day. 10. You should also ignore trading buy or sell signals, if they are formed after a large price movement in the direction of a trading signal. Here are examples of transactions using the Forex strategy Vegas-Wave Buying: in this case the stop-loss order is initially placed at the level 1.4050, minus filter 5 points.

Market entry was performed at the beginning of the third Elliott wave.

Pic 1 Selling:

Pic 2 Market entry was also performed at the beginning of the third Elliott wave. In this case, the first 50% of the transactions were taken approximately at the level 323% from the first Elliott wave. The second 50% of the transactions were taken on the placed take-profit at the level 362% minus filter. Elliott Indicator