Zero Lag Stochastic Scalping Strategy For MT4
Table Of Contents:
- Zero Lag Stochastic Scalping Strategy For MT4
- The Zero Lag Stochastic Scalping Strategy For MT4 – Long positions
- The Zero Lag Stochastic Scalping Strategy For MT4 – Short positions
- Is the Zero Lag Stochastic Scalping Strategy For MT4 profitable?
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 Zero Lag Stochastic Scalping Strategy For MT4 is a very simple short term trend following strategy. This trading system works best during the 15 minute chart timeframe. The choice of indicators used in the zero lag stochastic scalping strategy are quite good and complement each other.
This trading system focuses on the short term movements in the market. This means that it is not 100% trend following trading system. But rather, this trading strategy signals you to potential retracements as well. Therefore, you can view the zero lag stochastic scalping strategy as a retracement and a trend following system. This means that the trading signals you see can be both trend following as well as counter trend trading signals.
The first indicator used in the zero like stochastic scalping strategy is the zero lag stochastics indicator which you see in the first sub window. This is the regular stochastic oscillator, but it also has a moving average line. Long and short signals can be taken based on how these two lines intersect each other.
The other indicator which is responsible for plotting the up and down arrows on the price chart is called the MA crossover indicator. This is a custom indicator which makes use of two exponential moving averages which are set to the three and five period settings.
Let's now take a look at how you can trade long and short positions using the Bull eye forecast strategy for MT4.
The Zero Lag Stochastic Scalping Strategy For MT4 – Long positions
Long positions using the zero lag stochastic scalping strategy can be taken when you first see an up pointing arrow showing up on the price chart. Following this, look to the zero lag oscillator in the sub window. Here, the thick black line which is the signal line should be moving above the white dashed line. This signals that the market is moving to the upside.
You should also look to the fast trend indicator which is the oscillator in the second sub window of the zero lack stochastic scalping strategy. Here, the histogram bars should be turning green indicating that the market trend is to the upside. After a confirmation from both of these two indicators, you should also look to the price action patterns. Look for breakouts from inside bars or bullish reversal patterns and once this is validated you can take a long position at market.
Set your stop loss to the recent low that formed where the up arrow appeared. You can split your position such that the first part of your take profit is set to a calculated risk to reward ratio. For the second part, move your stop loss to break even at regular intervals. This will ensure that you are able to capture the maximum trend when the trends are strong. Eventually you will get stopped out at a profit.
The Zero Lag Stochastic Scalping Strategy For MT4 – Short positions
Short positions using the zero lag stochastic scalping strategy can be taken when you first see a down pointing arrow showing up on the price chart. Following this, look to the zero lag oscillator in the sub window. Here, the thick black line which is the signal line should be moving below the white dashed line. This signals that the market is moving to the downside.
You should also look to the fast trend indicator which is the oscillator in the second sub window of the zero lack stochastic scalping strategy. Here, the histogram bars should be turning red indicating that the market trend is to the downside. After a confirmation from both of these two indicators, you should also look to the price action patterns. Look for breakouts from inside bars or bearish reversal patterns and once this is validated you can take a short position at market.
Set your stop loss to the recent high that formed where the down arrow appeared. You can split your position such that the first part of your take profit is set to a calculated risk to reward ratio. For the second part, move your stop loss to break even at regular intervals. This will ensure that you are able to capture the maximum trend when the trends are strong. Eventually you will get stopped out at a profit.
Is the Zero Lag Stochastic Scalping Strategy For MT4 profitable?
The zero lag stochastic scalping strategy is a fairly reliable trading system. This trading system incorporates the right number of trading indicators and gives you the best possible context of the markets. This will in turn increasing confidence in trading. However, remember that one of the biggest drawbacks with the zero lack stochastic scalping strategy is the fact that when the market is moving in a sideways range, you will see multiple buy and sell signals.
Bear in mind that during such times, you will see multiple buy and sell signals coming up on your chart. There is a very good chance that you can get whipsawed during such signals which appear during sideways trends. Therefore, it is also advisable that traders pay attention to the trend and know when the market is moving sideways in order to stay away from the markets.
The trading template that comes with zero lag stochastic scalping strategy is fairly lightweight and therefore can be used to monitor multiple instruments at the same time. However, for beginners, we recommend that you should use this trading template only on one instrument until you get familiar with the trading system itself.
Paying close attention to your risk management is very important when trading with the zero lag stochastic scalping strategy. There is no trading system that can offer you 100% profits all the time. Therefore, the key to making consistent profits is to ensure that you take on the appropriate risk for the trade.
For the above mentioned reasons, we can recommend that traders can make use of the zero lack stochastic scalping strategy. Bear in mind that this is a short term scalping strategy and therefore cannot be used for swing trading. Those who want to experiment further can also make use of potential intraday pivot points as well in order to book your profits.
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