Extra Successful Heikin Ashi Day Trading Strategy

Before you try to read through this strategy, you must know theory and basics about Heikin-Ashi candlesticks.

In simple word, Heikin-Ashi is one of the chart type that filter out market noise and smooth it. Its works for all

kind of instruments such as forex, commodity, indices, stocks and crypto because it is calculated based on OHLC

of that instrument.

For day trading or intraday strategy, the most suitable timeframe to use is between FOURS HOURS chart and

below.

What we need?

For this strategy obviously we need two chart of Heikin-Ashi, H4 and M15 or H1 and M5.

The bigger timeframe we use to determine the direction of the market, while the lower timeframe we use to

enter or re-enter the market.

Before that, you MUST know this type of Heikin-Ashi candlestick:-

Strong uptrend candle Strong downtrend candle

 Medium body  Medium body
 Only upper shadow  Only upper shadow

Initial uptrend candle Initial downtrend candle

 Medium body  Medium body
 Upper shadow longer  Lower shadow longer
than lower shadow than upper shadow

Ranging or Ranging or
reversal signal reversal signal

Figure 1 Basics Heikin-Ashi candlestick

How to determine direction of market using Heikin-Ashi as our GPS?

In the bigger timeframe H4 or H1, we looking for initial uptrend or downtrend candle.

Next, we confirm with strong uptrend or downtrend candle.

To make it simple, we are looking initial candle and strong candle next to each other’s.

Figure 2 Looking Initial and Strong candle next to each to others

How to join the market confidently?

While in lower timeframe, we just looking Blue (uptrend) or Red (downtrend) color of Heikin-Ashi candlestick

to join the market.

If our GPS show initial candle uptrend with confirmation strong uptrend candle, we only interested to go up.

While, if our GPS show initial candle downtrend with confirmation strong downtrend candle, we only interested

to go down.
How to set an emergency break after we ride the market?

We cannot underestimate the market behavior. Sometimes our GPS can loss its mind because of bad internet

connection. So we should know, when to stop follow the GPS until its get back to its mind.

So we put our emergency break 10~15 pips above or below initial candle.

Or you may cut loss if our GPS show opposite initial candle.

Figure 3: Stoploss

Figure 3 above show how to set your emergency break. If price turning back until initial candle, means that

candle is not valid anymore.

How to set your destination after you ride the market?

The purpose of GPS is to help us to reach our destination, so that, we must know where is our destination. To

make easier, we can use 2:1 risk/reward. If our emergency break is 60pips, our destination should be 120pips.

Sound easy right! Don’t make it complicated.

Figure 4 Normal candlestick M15 timeframe

 Figure 5 Heikin-Ashi M15 timeframe

Both Figure 4 & 5, show how your emergency break and destination looks like in lower timeframe after we

determine uptrend in Figure 2 & 3. In trading, you must know you risk before thinking about reward.

Another tips, you can join again the market if you miss the first entry. In lower timeframe, wait until Heikin-Ashi

candle change, from Red to Blue (uptrend) and Blue to Red (downtrend).

Summary

 You need two chart Heikin-Ashi candle either H4 and M15 or H1 and M5.

 H4 or H1 is your GPS that using initial candle and strong candle as confirmation.

 M15 or M5 as your entry and re-entry.

 10~15pips away from initial candle is your emergency break.

 2:1 is your destination.