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Super Trend Bounce Forex Trading Strategy

Trends are one of the easiest types of market conditions to trade. As one stock trader who traded during the “.com” boom said, you could just buy any stock that had a “.com” in the morning and exit, go back to trading in the afternoon and see how the price went up.

This is what happens when there is a trending market condition. Momentum and sentiment are on the side of the trend and these things continue to push prices in the direction of the trend.

However, it is not as easy as it sounds. Many traders follow trend and momentum guilty of chasing price. This habit causes them to buy high and sell low, or sell low and buy high in the case of a downtrend.

So how do we trade with the trend without falling victim to the price chase? One of the best practices that many traders use is to trade during retracements. This allows them to trade with the prevailing trend while avoiding buying at the top or selling at the bottom.

The Forex Super Trend Bounce trading strategy is a simple trend following strategy that trades with the trend while waiting for the price to drop again at a low price.

super trend

The Super Trend Indicator is a trend-following indicator based on the Average True Range (ATR).

One of the ways many traders see trends and trend reversals is by using the ATR. The assumption is that the trend reverses when the price goes against the direction of the current trend by more than 3 times the ATR. Some consider the trend to be reversed when the price moves against the current trend by more than twice the current ATR.

The Super Trend indicator is also based on this concept. The indicator draws a line behind the price action at a certain distance based on the ATR. When the price breaks through and closes the supertrend line, the indicator detects a trend reversal and moves the line to the opposite side of the supertrend line.

Super trend lines can be used as trend reversal entry signals. Traders can place a trade whenever the line shifts to the opposite side of the price action.

It can also be used as a trend direction filter. Traders can easily avoid trading setups that go against the direction the Supertrend indicator shows.

Finally, it can also be used as a basis for placing stop-losses. Traders can easily place their stop loss behind the Supertrend line or follow it as the line moves.

Forex main trends

The Forex Main Trend Indicator is a trend following indicator that shows the direction of the trend using bars.

It pulls the bar in a separate window. These bars change color when the indicator detects that the trend has reversed. Blue bars indicate the direction of the bullish trend, while the red bars indicate the direction of the bearish trend.

Traders can use the change in bar color as a trend reversal signal. You can then make buy or sell trades based on these signals, provided they converge with other trend indicators.

Traders can also use this indicator as a trend direction or impulse filter. Using the shorter momentum indicator, traders can trade based on other indicators as long as the signals generated are consistent with the trend as indicated by the Forex Leading Trends indicator.

trading strategy

This trend following strategy is traded based on the direction of the trend indicated by the Supertrend Indicator, Forex Main Trend Indicator and the 200 period Exponential Moving Average (EMA).

The main trend direction is based on the 200 EMA line. It is based on the direction of the slope of the 200 EMA line and the general location of price action in relation to the 200 EMA line.

The super trend line should then confirm the trend based on the location of the price action relative to the super trend line as well as the color of the super trend line.

The price should then retreat towards the supertrend line. This will cause the Forex Main Trend Indicator to temporarily retreat.