Forex Pure Entry System – An In-Depth Review
The Forex Pure Entry System is a trend-following strategy designed to identify high-probability entry points in the forex market. This system aims to catch big moves by trading with the dominant market trend.
Overview
The core of the Forex Pure Entry System is based on Gann angles, which are diagonal trendlines drawn across price charts to identify potential support and resistance levels. However, the system enhances the Gann angles with additional filters to improve accuracy and confirm trend direction.
Specifically, the system uses the following components:
- Gann Angles – Plotted on the chart to forecast potential turning points and trend direction
- Price Action Channel – A channel based on recent price swings that acts as a filter to confirm the Gann angle signals
- Two Entry Levels – The system provides two possible entry points to capitalize on the momentum from the Gann angles
- Two Profit Targets – Each entry has pre-defined profit targets to lock in gains from the trades
By combining Gann theory with price action analysis, the Forex Pure Entry System aims to pinpoint high-probability reversals and momentum moves.
How It Works
The Forex Pure Entry System is purely a reversal system – it looks to enter counter-trend once a potential trend reversal has been identified by the Gann angles and confirmed by the price action channel.
There are two aspects to the system:
1. Gann Angle Forecast
Gann angles are plotted on the daily time frame and used to forecast potential support, resistance and trend reversal points. The angle of the Gann line indicates the strength and direction of the potential move.
When a Gann angle forecasts an impending trend reversal with sufficient strength, it signals the first component required for an entry.
2. Price Action Channel Confirmation
Before placing a trade based solely on the Gann angle, a price action channel is used on a 30-60 minute chart to confirm direction and momentum. This acts as an additional filter on the Gann signals.
The slope and direction of the price action channel must align with the reversal forecast by the Gann angle to give the green light for an entry.
When both the Gann angle and price action channel are aligned and forecasting the same direction, this flags a high-probability entry point for the system.
Entry Rules
The Forex Pure Entry System provides two entry levels for traders to get onboard the expected momentum move:
Entry 1
The first entry is placed as soon as the Gann angle reversal is confirmed by the realignment of the price action channel. This aims to enter early to capture the initial momentum.
Stops are placed below the recent swing point to limit downside.
Entry 2
The second entry is triggered on a break of the price action channel after Entry 1 is filled. This aims to catch the acceleration as price breaks out of the channel.
Stops are placed below Entry 1 to limit downside if the breakout fails.
Exit Rules
The system employs two profit targets for each entry signal:
Target 1
The first profit target is set at a 1:2 risk-reward from Entry 1. For example, if Entry 1 has a 50 pip stop, Target 1 would be set at 100 pips.
This allows traders to bank partial profits if the move extends as expected.
Target 2
The second profit target aims for an optimal risk-reward of 1:5 from Entry 1. So if Entry 1 has a 50 pip stop, Target 2 would be set at 250 pips.
The second target allows for an outsized profit if the trend move is especially strong.
If price reverses sharply during the trade, traders can exit manually based on price action. But the two pre-set targets allow for hands-free exits if not touched prematurely.
Performance
The developer of the Forex Pure Entry system claims it captures moves of 25-50 pips on average. When the trend is especially strong, 100+ pips per trade is not uncommon.
Backtests purportedly show a win rate exceeding 90% with optimal risk-reward targeting gains of 1:5 or more per trade.
However, past performance does not guarantee future results. As with any trading system, real-world application may vary depending on market conditions and trader discretion.
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Time Frames
The Forex Pure Entry System for MT4 is designed primarily for the daily time frame given its use of Gann angles for the trend forecast.
However, entries and trade management can be done on shorter time frames such as 30 or 60 minutes based on the price action channel signals.
Intraday traders may also be able to apply the principles of the system on the 15 or 30 minute charts.
Pure Entry System Pros and Cons
Pros
- Combines Gann theory and price action for high-probability setups
- Clearly defined entry, stop loss and profit target levels
- Two entry points allow traders to scale into momentum moves
- Hands-free exits with pre-set profit targets
- Simple and intuitive trading system
Cons
- Limited to trend reversals only
- Requires discretion and skill in plotting Gann angles
- Shorter-term traders may find daily timeframe setups too slow
- Past performance not indicative of future results
Pure Entry System Verdict
For traders looking for high-probability reversals at key market turning points, the Forex Pure Entry System warrants a closer look.
The combination of time-tested Gann theory with confirmations from price action analysis could offer traders an edge in timing entries.
However, as with any trading system, real-world performance will ultimately depend on the trader’s skill in applying the principles of the system. Proper trade management will be key to maximizing its profit potential.
Overall, traders interested in trading with the major market trends should consider testing the Forex Pure Entry System to see if it aligns with their trading style.