The "London Explosion" Strategy. A New Look
Good day, fellow traders. I am glad to see you again on the forex portal tradelikeapro.ru, and this time we will talk about the classic trading strategy "London Explosion". But in its standard form this system will bring you nothing but losses, so in the video below I will introduce you to its modified variation, taking into account the features of the modern market.
Characteristics of the "London Explosion" Strategy
There is a huge number of variations of the "London Explosion" trading system, but in general the essence comes down to catching and following the first impulse at the beginning of or before the London session. There is an opinion that the first impulse shows the direction in which the price will move during the day.
About 5 years ago such a strategy worked and generated profit, but with the growing popularity of this approach, market makers began to encourage the creation of "false breakouts," false impulses. That is, what happens: the market produces an impulse before or at the beginning of the European session, the orders of traders following the first price jump are activated, and a little later the price reverses. Stop-loss orders are triggered, and the market makers safely take their well-deserved profit. Once again, they managed to fool the simpletons.
And a similar picture in today's market can be observed on most trading days. So why should we not leave the classic version of the "London Explosion" strategy aside? After all, it will be much more effective to follow the market makers, using the reverse version. That is the one we will apply.
System Rules
1. Measure the height of the range in the interval from 9 to 18 hours GMT. Its size in points equals 2X.
2. After 18:00 place 2 orders: Buy Limit and Sell Limit at a distance of X points from the current price.
3. The take-profit of each order equals 2X, stop-loss = X+5 points.
4. The next day at about 9:00 Greenwich time, delete and close all orders regardless of profit / loss.
5. If the range from 9 to 18 hours equals or exceeds 60 points, - DO NOT TRADE.
6. Important ! After one order is activated, it is necessary to delete the second.
The rules of the "London Explosion" strategy are discussed in more detail and with examples of trades on charts in the video lesson at the beginning of the article.
P.S. If you do not know how to use Buy Limit / Sell Limit pending orders, watch the video at the link:
https://tlap.io/otlozhennyie-ordera-na-foreks/
P.P.S. For automatic deletion of the second order after the first one is triggered, you can use the expert advisor e-OCO. It is easy to find it at the link:
https://tlap.io/avto-menedzhment-pozitsiy-v-metatrader-4/
Forum Topic
Today, fellow traders, we will talk about the classic "London Explosion" trading strategy and its modified version adapted to the modern market.