Strategy 1: 80-20 trading strategy

The basic idea behind this trading strategy revolves around forming simple candlestick forms. Especially candles with large real bodies and small shadows. In the right market conditions, this candlestick pattern is a reversal signal.

Trading principles are as follows:
  • The body of a candle should make up at least 80% of the entire candle.
  • Candles should make up less than 20% of the candle (ideally 10% on each side).
  • The opening price of this candle should be at least 5-15 points below or above the previous candle. The previous candle was a candle with strong momentum.
  • When the market breaks the low of the previous momentum candle, you can execute a buy order and vice versa.
  • The stop loss can be placed below the lowest price of that candle for a buy order. And vice versa, place the stop loss above the highest price on the sell order.
  • This is a scalping strategy, so we will take profits early, not expect large profits.
Below is an example of a sell signal:


As we can see in the figure above the sell entry point is when the price falls below the high which is also the close of the previous momentum candle.

Strategy 2: combine ADX and MA

This strategy has a fairly simple principle, which is a combination of 2 indicators ADX and the moving average MA 20.

Trading principles are as follows:

For buy orders:
  • ADX must go above 30 and go up.
  • Wait for the price to retest the 20-period MA, ADX may drop at this time but need to maintain above 30.
  • After the price touches MA20, place a buy stop above the highest price of the respective candle.
  • After execution, place your stop loss below the nearest low.
  • You can set profit targets at the nearest high or move the stop loss to the trend.
The principle of sell orders is the opposite of buy orders. Here is an example for your reference:


Strategy 3: Three Little Indians Strategy

This is a pure price action strategy with quite simple trading principles. As follows:
  • First, you need three consecutive vertices that are ascending. With each vertex formed there is not much difference.
  • Open short position market drops below the 20% range of the second peak.
  • Place a stop-loss order above the newly formed top.
This candlestick pattern can be used in any timeframe. Below is a clearer example of this pattern:



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