Star forex trading system free download
The Evening Star chart pattern strategy or shooting star pattern is a simple yet a very powerful Forex reversal strategy. The Evening Star strategy can be broken down into six easy steps. Our team at Learn to Trade for Profit has managed to develop this simple Forex strategy because we have an eye star forex trading system free download details. We also have an unorthodox way of reading the price action pattern and from here comes our edge.
The Evening Star chart pattern is a common pattern not just in the Forex currency market as this pattern, can appear in the stock market, commodity markets or star forex trading system free download other markets.
The Evening Star chart pattern is really a minimalist chart pattern unlike the Head and Shoulder pattern which is a reversal pattern as well but with a more complex structure. In technical analysis, the Evening Star chart pattern is a three candlestick bearish reversal signal.
The first candlestick is a long bullish one followed by a second candlestick which is a small candle representing indecision in the market and the third one is a long bearish candlestick that breaks below the low of the middle candle — or the star candle.
The middle candlestick needs to have a short real body followed by small wicks as well. The signal gets stronger if the third candlestick is a bearish engulfing candle meaning that it closes below the first candlestick open price. If you want to learn more about the engulfing pattern read The Engulfing Candle Price Action Pattern — a guide that will teach you everything you need to know about this kind of patterns.
From a psychological point of view, the Evening Star chart pattern is signaling that the bullish momentum is slowing down.
This can be an early indication that the smart money are starting to sell, but only a break of the low can confirm the Evening Star chart pattern. This is a bearish reversal signal so we would only look for this pattern to appear at the end of a bullish trend. Star forex trading system free download we move forward, we must define the indicators you need for the Evening Star chart Pattern.
RSI Indicator is a momentum oscillator indicator that calculates the speed and change of price movements. Trading the Evening Star chart pattern in combination with the RSI indicator is the ultimate symbiosis for spotting turning points in the market. The RSI indicator should be easily located on most trading platforms under the Indicators library. Please have a look at the chart example below to see how to use the RSI indicator. By analyzing the market on multiple time frame we increase the odds of success as we have a more accurate star forex trading system free download of star forex trading system free download actual price action.
We lower our time frame down to the 5-minute chart. We want now to utilize the lower TF to better time our entry. We also want to see the Evening Star chart pattern developing on the 5-Minute time frame. It is star forex trading system free download to wait just for the first two candles of the Evening Star pattern. Remember, we need the first candle to be a big bullish candle followed by a second candle with a small body. In the figure below you can see the inception of the Evening Star pattern with bullish candlestick patterns: Before looking for the completion of the Evening Star pattern, we also want to make sure the bullish trend is exhausted.
At this point, our short position was triggered, but we need a place to hide our protective stop loss and a level where we can take our profits, which brings us the next step of our Evening Star chart pattern strategy.
We want to hide our protective stop loss just above the highest level of the middle candle. In order to avoid getting whipsawed on a false breakout, we want to add a 5 pips buffer to our SL as extra protection not to get stopped out too early. Knowing when to take profit is as important as knowing where to place your SL, which brings us to the next step: The Evening Star chart pattern strategy looks to capture as much as star forex trading system free download from the new trend and the logical point to take profits should be once the RSI indicator reaches the oversold territory.
We want to take profits as soon as the RSI oscillator breaks below the 30 level. In the figure below you can see an actual BUY trade example, using the Evening Star chart pattern strategy. The Evening Star chart pattern star forex trading system free download is a great reversal strategy that proves that you can still find successful Forex trading strategies.
I personally love to use candlestick reversal patterns in my trading ventures. All that matters is to know how to correctly look at the price action and more important to exercise discipline and only trade when all factors come together and signal a trade.
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