Scalping with the tunnel Strategy For MT4
Table Of Contents:
- Scalping with the tunnel Strategy For MT4
- Scalping with the tunnel forex trading strategy – Long positions
- Scalping with the tunnel forex trading strategy – Short positions
- Is the scalping with the tunnel forex trading strategy good for you?
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 Scalping with the tunnel Strategy For MT4 as the name suggests is a forex scalping strategy. It makes use of the tunnel or the channel lines on the price chart. It offers short term scalping opportunities in the market. As a result, it makes the scalping with the tunnel forex trading strategy a day trading strategy that is suitable on lower time frame charts. You could also potentially extend the scalping with the tunnel forex trading strategy up to the one hour chart time frame as well.
The main indicator that is in use with the scalping with the tunnel forex trading strategy is the T&C Wonders custom technical indicator. This indicator is responsible for plotting the channel that adjusts to the price volatility. The basis of this technical indicator is to make use of buy and sell signals that appear when price makes a local swing high or swing low within the time frame in question.
There is also the moving average indicator which is plotted in a white thick line. This moving average is set to a default period of 10 and is a Linear weighted moving average, set to closing prices.
Then we have two oscillators that determine when you should go long or short in the market. The first oscillator is the default Williams' percent range indicator also known as the %R indicator. This oscillator moves between levels of -20 and -80. Long and short positions can be taken as and when price moves out from these levels.
Secondly, there is the stochastics oscillator. This oscillator is set to the default setting of 21, 5, 5 and high and low prices. The stochastics oscillator also makes use of the linear weighted moving average in its calculation.
Thus, combining all the above indicators, we get the scalping with the tunnel forex trading strategy. This strategy can be applied on short term charts as well as medium term charts. Bear in mind the fact that you are merely scalping the markets. So trends don’t really matter when it comes to this trading system.
Scalping with the tunnel forex trading strategy – Long positions
Long positions in the market using the scalping with the tunnel forex trading strategy can be taken when the signals align together. This means that traders should first begin by watching the price chart. We need to see the price action trading near one of the lower channels.
When you see that price is trading near one of the lower price channels, the next step is to look at both the Williams’ percent range and the stochastics oscillator. We need to see both these two oscillators trading in the oversold levels. Don’t forget that the oversold and overbought levels for both these oscillators have slightly different values.
When the conditions match up, you can then place a long position at the open of the next candlestick session. You can use the lower point of the price channel where price initially touched down to. This will set your stop loss level on the trade.
For take profit set up, you can look to the price channel. Use the initial inner most upper line as your take profit. This means that you have to constantly adjust the take profit level for the long positions. You can also use another method where you can add to multiple positions as well. Or, you could merely set a fixed risk to reward ratio for this strategy.
Scalping with the tunnel forex trading strategy – Short positions
Short positions in the market using the scalping with the tunnel forex trading strategy can be taken when the signals from the two oscillators and price action align together. Therefore, you should start by watching the price chart. We need to see the price action trading near one of the upper channels of the T&C indicator.
When you notice that price is trading near one of the upper price channels, the next step is to look at both the Williams’ percent range and the stochastics oscillator. We need to see both these two oscillators trading in the overbought levels.
When the conditions match up, you can then place a short position at the open of the next candlestick session. You can use the higher point of the price channel where price initially touched to before going short. This will set your stop loss level on the trade.
For take profit set up, you can look to the price channel directly. Use the initial inner most lower line as your take profit. You will have to constantly adjust the take profit level for the short position. You can also use another method where you can add to multiple positions as well.
Is the scalping with the tunnel forex trading strategy good for you?
The scalping with the tunnel forex trading strategy as demonstrated in this article is relatively simple to trade. Due to the fact that there are not many technical indicators in play, beginners will also find it easy to trade with this trading strategy. There is of course a bit of a learning curve when it comes to using the scalping with the tunnel forex trading strategy.
This is a scalping system. Therefore, traders do not have to bother with the trends in the market. Simply follow the rules as outlined in the long and short position examples and you should be on your way to making decent profits using this method. We particularly like the tight stop losses which enables you to maximize the profits when you are trading with this trading system.
Due to the fact that the scalping with the tunnel forex trading strategy is a short term strategy and the fact that it requires you to manage your positions actively, it might not be suitable for everyone. We also recommend traders to apply this trading strategy to just one currency pair. This is because you already get quite a few signals. Thus, to avoid confusion, it is best to use the scalping with the tunnel forex trading strategy on one currency pair and one time frame.
Download the complete system description and the files here:
Partially Automated Trading Besides Your Day Job
Alerts In Real-Time When Divergences Occur
