Early Bird Forex trading System

Posted by Felix Okoli on Tuesday September 27, 2011 10:50:27:

This is a method you can use to get a few pips when trading forex in Nigeria or anywhere else you are. It simply has to do with trading for a few pips during the Asian session or pre-euro time. In Nigeria, that will be before 7 am.

Here is the strategy for this setup:

Target = 10 to 20 pips
Preferred currency paid = EUR/USD
Entry time = 6.00 am Nigerian Time
Exit time = 6.45 am to 7.00 am

How we do it
The idea is to trade with more funds and with a higher percentage of capital but for a short time frame only and doing this when the market is just waking up.

Assuming, I have $500 to trade with, I then decide to invest $200 in a trade and using leverage, this gives me funds of up to $20,000.

So I now open a buy position by 6.00am after the price might have dipped a little and immediately set and exit target or take profit at about 20 pips and if it hits I gain $40.

Let's assume the scenario with the EUR/USD prices at 1.4500. I make an entry and set an exit at 1.4520 and immediately set a stop loss at about 50 pips 1.4470 although this is not likely to get hit but it's a risk that may limit your loss to $100. The 20 pips is more likely to get hit since the market is still waking up and when it does, I close out automatically with $20,000*10.0020 = $40.

If you are successful at trading this for 20 days, you would have gained $800

Time factor
Since this is an early bird strategy, we won't stay late but will exit before the euro session starts as news events tend to happen then and market can go in any direction. So you have to exit early whether or not it hits your target.

Best trading days using this strategy: Tuesdays, Wednesdays and Thursdays.

Rules
- Once your trade has closed, don't repeat the trade
- Enter early and exit early (Before the euro session)
- Always set a realistic exit target. 10 to 20 pips is ok
- If you lose, don't try the same strategy again till the next day.