Diagonal Trend Line Strategy

Diagonal Trend Line Strategy

Strategy Parameters:

Time frame: 

daily, 4H, 1H
 

Currency pair: 

Any

Indicator:  

Diagonal Trend Line

Trend line Definition:

Trend line is very simple, powerful and more reliable element of technical analysis used for help in trade decision in Forex Trading. Trend lines are solely created manually.There are different type of trend lines, Horizontal Line, Vertical Line, Diagonal line.

Trading rules:

Buy:

when Descending Diagonal Trend Line break above.

Sell: 

When Inclining Diagonal Trend Line break below.

Stop Loss:

Stop Loss placed at the time of entry and adjust above the most recent swing high/low

Profit Traget:

You can set profit target with different ways.

Option 1:

Close trade when you have earn Profit in between 50Pips & 100Pips

Option 2:

Place Profit limit at First support, Second support or Third support.

 

My Practical Experiment:

I try Diagonal Trend Line Strategy for trade in EUR/USD on hourly chart

Inclining diagonal trend line has break below according to diagonal Trend Line Strategy condition is suitable for selling EUR/USD pair but according to my observation some time price give wrong break out signal to avoid wrong breakout signal use an other extra technique

Technique for avoid wrong breakout signal:

Wait  for closing of running candle if second candle is also open below the Inclining diagonal trend line then place an Sell Entry order 1 pip below from (low) of first candle

Now if price come back and open the trade then wait for hitting profit target if candle close above the Inclining diagonal trend line once again then I need further action

Now remove the sell entry order, set again the Line 4 (in these pictures Line 4 is Inclining diagonal trend line) and wait for new break below the Inclining diagonal trend line

New breakout has occur new candle is open and close below the Inclining diagonal trend line in this condition I used again (Technique for avoid wrong breakout signal).Sell trade is now open @ 1.3260 place Stop Loss & Profit Limit at the moment when trade open

My trade is in profit 90Pips & today is weekend (closing day) so I decide to close the trade at this Level