Well, this is one of the best scalping setups out there. Trend following trade setups always stand above the rest. Trends are your real friends; they rarely betray you so follow them by taking little risk. This Luxury scalping setup uses two types of indicators; one is moving averages and another, OBOS oscillators. To be specific there are three exponential moving averages; 20EMA (blue), 50 EMA (red), and 200 EMA (yellow). On the bottom of the chart you can see bunch of oscillators. They are OBOS (overbought/oversold) oscillators which are pretty much like stochastic indicator. For the calculation of OBOS indicator highest close/lowest close are used. The number of periods used in OBOS indicates total number of previous price bars used in order to calculate the OBOS. The numbers of previous price bars used in luxury scalping strategy ranges from 10-40. The oscillators whose periods ranged from 10-20 are red in color while the oscillators that are ranged in period from 30-40 are blue in color.
The red colored oscillators move faster than the blue colored oscillators because comparatively the fewer periods are used in the red colored oscillators. The fewer the periods used, the more volatile is the oscillator. Conversely, the more periods you use, smoother is the OBOS oscillator. In short, luxury scalping strategy uses the moving averages crossovers and the OBOS cross overs in order to execute the trade in the market. Same like the oscillators, 20 EMA moves the fastest among the three. 50 EMA moves in between the 20EMA and 200 EMA; 200 EMA is the slowest one. Now let us discuss about the conditions that are needed to be met foropening the position in the market.
Remember, since this is a trend following strategy this strategy works best in trending markets or it’s even better to not use this strategy in sideways/flat market.
Best Time frame: 5 Minutes
Best Pairs to Trade: Major Pairs
Conditionsfor Buy Using Luxury Scalping:
- Major trend should be up i.e. price should trade above the 200 EMA.
- 20 EMA (blue) should cross above the 50 (red) and 200 EMA (yellow)
- Red OBOS oscillators should trade above the blue OBOS oscillators.
Stop loss: Two pips below the 50 EMA (red)
Take profit: 10 pips
Below are the conditions for short opportunities.
Conditionsfor Sell Using Luxury Scalping:
- Major trend should be down i.e. price should trade below the 200 EMA.
- 20 EMA (blue) should cross below the 50 (red) and 200 EMA (yellow).
- Red OBOS oscillators should trade below the blue OBOS oscillators.
Stop loss: Two pips above the 50 EMA (red)
Take profit: 10 pips
These three are the only rules to open positions in the market. It’s quite simple right? Well, you really don’t need complex strategies to succeed in trading. Mastering these simple systems are enough to make money. Newbie traders tend to underestimate the simple trading setups and they always seek for advanced methods thinking that advanced methods will work for them. But that is not the truth. It takes a lot of self discipline to master the simple strategy and ultimately to make money.
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