5 min Momo Trader Strategy For MT4
Table Of Contents:
- 5 min Momo Trader Strategy For MT4
- Selecting the trading instrument
- 5 min Momo Trader Strategy For MT4 - Long trade setup
- 5 min Momo Trader Strategy For MT4 - Short trade setup
- Trade Management
- 5 min Momo Trader Strategy For MT4 - Conclusion
Please note: This strategy was publicly published in the trading community and is free to use. We do NOT make an attempt to decide if this strategy is profitable or not, because we know that the major factors regarding trading results are the skills/experience of the trader who executes the strategy. Therefore, we are mainly explaining the components and rules of the strategy. If applicable, we are highlighting advantages, disadvantages and possible improvements of the strategy.
The 5 min Momo Trader Strategy For MT4 provides a standard mean to take trades in the 5-minute chart. When we speak about the lower time frame, we become frustrated since the success rate in such a lower time frame is pretty low. We need to dig deep and find out the root cause for which traders are failing to succeed in the lower time frame. It is nothing but the absence of a well-balanced trading system that forces us to lose money most of the time. But with the aid of the 5 min Momo Trader Strategy, anyone can start making a consistent profit without having major psychological stress.
The system uses 5 min Momo and MACD true from swingman indicators. These two indicators are calibrated for the 5 minute and 15-minute charts. Traders who are new to the market can start trading in the 15-minute chart so that they have enough time to think about a trade setup. Once the traders become skilled in analyzing the 15-minute chart, they can move to the 5-minute chart and start making some serious cash. But this is not a must that you have to move to the 5-minute chart. If you feel comfortable with the 15-minute chart, stick to it.
Selecting the trading instrument
One of the common obstacles in using the 5 min Momo Trader Strategy requirement of currency pair selection. Though the system is designed to deal with any currency pair, we have to pick our asset-based on certain traits. This will help us to get better over the period and make us more profitable. Traders should be looking for the low spread and nature of the trend in the asset. Trending asset provides a better opportunity as you don’t have to deal with the choppy state of the market. So, you have to learn about the different phases of the trend so that you can easily identify up and downtrend in the market.
While selecting the instrument, you don’t have to evaluate the trend in the higher time frame. If you look at the trend in the 5 minute or the 15-minute chart, it will be enough to determine whether the asset is good for trading or not. The market must be making key swings imposing the dominance of the buyers or the sellers. And try to pick the instrument by evaluating the trading session. If you open the trades based on important trading session, you should be able to make more money as the market volatility will be in your favor.
5 min Momo Trader Strategy For MT4 - Long trade setup
The main tool for locating the best trading spot in the 5 min Momo Trader Strategy is the 20 period EMA. The EMA is very responsive and dynamically creates support and resistance. This means the yellow color signal line will be acting as your support level. The slope in the yellow EMA should be bullish and the price will be trading above it. Most of the time, it will touch the yellow and bounce off. We have to locate the bullish bounce in which we can spot a doji or the pin bar. Advanced traders can look for any kind of price action signal to consider it as a valid long trade setup. For confirmation, we will be evaluating the MACD true color indicator data.
In the MACD indicator, the green color cloud will be formed at the top of the 0.00 line. The red and blue signal line will be trading above that level. Open up the long trade with the stop loss below the tail of the pin bar or the doji. Be sure that the stop loss is placed below the yellow EMA as the price can test that level again as it will be acting as the dominant support level. The take profit in the trade will be set for 30 pips. So, if the SL is more than 15 pips, you should not take the trade. And remember, the 5 min Momo Trader Strategy will not generate profitable trades 100% of the time. So, keep your risk low in each trade.
5 min Momo Trader Strategy For MT4 - Short trade setup
Now we will be showing you the sophisticated use of the 5 min Momo Trader Strategy. We all know the trade signals are formed at the 20 EMA. Our main priority is to identify a bearish reversal price action signal at the 20 EMA as it will act as the dynamic resistance. Things are pretty similar to the long trade till this segment. But we will be using some advanced techniques to evaluate the trade signals while taking the data reading from the MACD true colored indicator. In the last part, we have told you the simple way by which you can filter the trade with the MACD true colored tool. But those formations are spotted in the most ideal state.
First of all, you have to evaluate the position of the stranded signal lines. To take the sell trade, the blue signal line must be trading below the red signal line. The position of these stranded signal line must be below the 0.0 level. Regarding the formation of the color cloud, it might be red or you find the diminishing green color cloud in the chart. The diminishing pattern in the green cloud suggests the bears have taken control over the market and ready to push the price towards the support level. While using the advanced method, the SL price will be determined with the PA signal and the take profit will still be 30 pips.
Traders become so concerned about the steps, that they often ignore the money management rules. As a new investor, you should not be taking more than 2 trades in the same trading session. Experienced traders usually trade for two different trading sessions and they quit trading for that day regardless of the results. You can’t afford to overtrade with the 5 min Momo Trader Strategy. Overtrading or breaking the rules to earn more money always results in a strong negative impact on your trading performance.
Things will start to make sense if you learn things in the demo environment. You won’t be under heavy pressure and this will provide you better learning opportunity. If you truly want to change your life, you must learn to take the trades by knowing the logic. And remember, following the rules of risk management is more important than knowing the key steps in the system.
5 min Momo Trader Strategy For MT4 - Conclusion
The 5 min Momo Trader Strategy provides powerful trade signals to the retail traders to make money. But seeing the high success rate of the trading system, the traders must not become carried away with joy. They have to look for the trade signals by considering the worst-case scenario. When a trader starts taking the trades expecting to lose money, it becomes easier for them to adhere to the rules. And trading with strict rules and following the mentioned steps in this guide will provide unique profit taking the opportunity to the retail traders.
To become a profitable trader, you have to think like a professional businessman. When you take any trade, you have to think twice and look at the associated factors. If possible get yourself familiarized with the fundamental data so that you can merge it with the technical factors so that you can make better decisions. Being a full-time trader, you should often take a small break from trading. This will refresh your mind and help you to see a better picture. So, work on your skills and try to trade with strict discipline.
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