1. Strategy rules:

This strategy works best for intraday timeframes, as it offers more trading opportunities than long timeframes, where we rarely come across double-peaks / patterns. two perfect bottoms. The preferred timeframe for this strategy is M15 (15 minutes). Here are the rules of the strategy:
  • Currency pairs: Any;
  • Time frame: 15 minutes;
  • Cut loss: 30 Pips;
  • Take profit: 60 pips;
2. The method of entering the order:

Buy Signal:
  • Identify the pattern of two vertices that appear closest;
  • Wait for the price to rebound from the previous breakout trend.
  • When the price breaks the resistance formed by 2 peaks we are ready to trade.
  • Buy when price retests the support formed by 2 peaks (As resistance has turned into support now), stop loss takes profit as a rule.

Above is an example of a buy trade and how to apply a strategy with the AUD / USD chart on M15. Here we have 2 peaks at 0.7628 but the pattern was broken upwards and the seller's stop loss (if any) triggered, we proceed to buy when the price retests 0. , 7628 with stop loss 30 pips below the entry point and we proceed to take profit 60 pips above the entry point.

Sell ​​Signals:
  • Identify the nearest two-bottom pattern;
  • Wait for the price to rebound from the previous breakout trend.
  • When the price breaks the support formed by 2 troughs we are ready to trade.
  • Buy when price retests the resistance (Support turned into resistance) formed by 2 troughs, stop loss takes profit as a rule.

The example above is the USD / CAD pair. The price formed a 2-bottom pattern then returned to test support and broke down, and then we are ready to trade. The whole family will place a sell limit order at the resistance formed at 2 bottoms, stop loss placed 30 pips above the waiting point. In this example, although the stop loss is about to be hit, we still end up with a profit of 60 pips.

3. Conclusion and Notes:

This is a backtest and trend trading strategy, unlike the usual double-top and double-bottom strategies, which require traders to trade against the trend (mostly because of pattern 2. a normal top 2 is a reversal pattern). This variation assures us of trend trading with a good risk/return ratio.

Note: Two top / double bottom patterns that have not been broken or broken (as usual) and then reversed are available!