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1 HOUR

FOREX REVERSAL
STRATEGY
Getting Started
This strategy is intended for bearish reversals primarily on the
one hour chart. However, it can be used effectively on the 15 &
30 minute chart as well. This strategy consists of three
indicators. Those indicators include:
1. 14 Period Weighted Moving Average (closed)
2. Parabolic SAR (.02,.02,.2) Start=.02 Increment=.02
Max Value=.2
3. Stochastic (14,3,3) K=14 D=3 Smooth=3
80/20 Levels

How to Trade
Trading this strategy is not difficult; however, finding suitable
setups may be hard because of the higher likelihood that they
will be profitable. To trade this strategy effectively you must
follow 3 rules:
1. The Stochastic indicator MUST show overbought
conditions, meaning it must be above the 80 level.
2. The Parabolic SAR must be ABOVE price and not below it.
3. The candlestick from which we are taking the trade from
MUST close below the Weighted Moving Average.
Here is an example of a perfect setup:
As you can see, the Stochastic indicator showed price was
overbought. The Parabolic SAR was above price and the
candlestick from which we took the trade closed BELOW
the Weight Moving Average. We would have taken the
trade just as the candle closed, as shown by the red arrow.

Here’s another example:


This concludes the 1 Hour Forex Reversal Strategy
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