The psych scalping trading system is a system used mainly in scalping strategy of the major currency pairs. The term psych tell is all. The main thing in this trading system is the psychology. Therefor you have to make the right judgments when trading otherwise you will end up making losses.
The psych level scalping trading system is mainly used with the 5M timeframe. The spread of the majors that you choose to trade mast have a spread that don’t exceed 15. Its template comes with the bar chart as its default chart. However you can change this to candle sticks if you aren’t comfortable with the bar chart. Especially for the forex beginners it is very much advisable to use the candlesticks instead of the bar charts.
This system uses the following indicators:
- Tro Dragon Money MGMT indicator
- SweetSport indicator
- m-candles indicator
- M-candles indicator
TRO Tunnel Dragon is fundamentally a virtuous technical indicator for the Metatrader4 users. It’s actually a combined moving average used with High, Low & Closed attributes.
The SweetSport indicator shows certain price levels, which are more importance than others. These levels are called round price levels. They end with 50, 00, 25 etc. For example, 1.4200, 1.4300, 1.4550. In the Forex market such price levels carry additional meaning, similar to steps or pivotal points where passing through each step adds a new value. Therefore more often than not the market will stop at round these price levels to re-think and or re-test prices before moving further. Therefore this indicator is used as a help to a better mapping of Support and Resistance levels on the chart.
Fig.the Psych level scalping Trading system template.
The m-candle and the M-candle indicators are the ones responsible for the formation of the additional candles. For example from the above chart it is visible that there are 15 minute candles that are stalked in the one hour candlesticks and the one hour candlesticks are in a one day candlestick.
The dotted line are the round price levels, shown by the SweetSport indicator. They just act as the support and resistant levels.
The extra candles that form are either green or red by default with the red ones showing the formed due to a downward trend while the green ones shows an uptrend. The one hour candlesticks that form are not color filled. The daily candlesticks are filled with faint color that allows you to see the other candles in the background.
Opening and closing of trades using the Psych level scalping Trading system
When trading always ensure that you are trading in the same direction as that of the one hour candlestick. The one hour candlestick will form even before a period of one hour is covered since the last one hour. The one hour candlestick shows the direction the market is as per the current market level with relation to level the previous hour candlestick closed at.
Therefore, you should trade at least after several candlesticks have formed inside the one hour candlesticks so that you can be really sure of the direction the one hour candlestick will follow.
Fig. illustrating when to open and close trades.
Then you only have to enter one trade per hour. If the daily and the one hour candlesticks are in the same direction, then there are hire chances of making bigger profits.
You then close your trades after the market moves at max 30 pips depending on the amount of money you want to loss or gain.
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