Strategy "Puppet Master" - a view of the market from 10,000 meters

I warn you right away: if you are a typical dim-witted beginner looking for a simple forex strategy with "arrows" and 99% profitable trades - move along.

Today we will talk about how not to depend on short-term fluctuations of currency pairs, how to see the global picture of what is happening and extract profit without nerves by applying the tactics of mid-term investors.

Platform: Metatrader 4
Currency pairs: Majors and crosses (more details below)
Timeframe: D1
Trading time: once a day
Recommended brokers: Roboforex, Forex4you

Read the strategy installation guide.

You have surely noticed that currency pairs move in a certain dependence on each other. For example, when EURUSD goes up, USDCHF goes down. And when GBPUSD rises, as a rule, NZDUSD follows it as well. Also, all pairs with the yen (JPY) usually move in one direction. Not every day, not every candle, but in general the tendencies exist. This is called correlation.

By identifying certain "families" of currency pairs and their dependence on the factor that unites them, for example the presence of Usd in the pair, we can open a single position across the whole group of currency pairs and thereby reduce risks by diversifying our position from within. This is called trading baskets made up of orders on different currency pairs. For more details, see the video at the beginning of the review.

We enter at once across all groups of pairs. Open positions ONLY if the Puppet Master indicator is between -10 and -30 or between 10 and 30. See below what to buy / what to sell for each group of currencies. Also note that each basket has its own separate indicator.

USD Basket

1) The indicator is above 10, but below 30:

Buy USDCAD, USDCHF, USDJPY

Sell EURUSD, GBPUSD, AUDUSD, NZDUSD

2) The indicator is below -10, but above -30:

Sell USDCAD, USDCHF, USDJPY

Buy EURUSD, GBPUSD, AUDUSD, NZDUSD

JPY Basket

1) The indicator is above 10, but below 30:

Sell AUDJPY, CADJPY, CHFJPY, EURJPY, GBPJPY, NZDJPY, USDJPY

2) The indicator is below -10, but above -30:

Buy AUDJPY, CADJPY, CHFJPY, EURJPY, GBPJPY, NZDJPY, USDJPY

GBP Basket

1) The indicator is above 10, but below 30:

Sell EURGBP

Buy GBPAUD, GBPCAD, GBPCHF, GBPJPY, GBPNZD, GBPUSD

2) The indicator is below -10, but above -30:

Buy EURGBP

Sell GBPAUD, GBPCAD, GBPCHF, GBPJPY, GBPNZD, GBPUSD

We exit the position if the indicator reaches 70 or -70 (take-profit). The stop-loss for us will be the indicator value of -10 or 10 (opposite to the position). Upon exit, it closes all orders in the basket.

If you have never traded baskets of orders before, then for you the risk is equal to 0.01 lot for every 10000 units of currency in the deposit. For 1 basket.

This does not mean at all that you need 10000$, 100$ in a cent account is enough. Compliance with such democratic money management is mandatory, given the specifics of this trading system.

The specified MM is intended for those who have never traded baskets, since they may simply panic from a large number of points across several pairs, whether in profit or in loss. Those who have already dealt with baskets will choose a suitable lot for themselves.

Fans of trading against the trend can experiment with entries in overbought / oversold zones. That is, open opposite positions when the indicator is above 70 or below -70.

The "Puppeteer" strategy is very simple and serves as a kind of introduction to trading with baskets of orders. You can quite easily optimize it, add your own conditions and filters. In general, medium-term trading with baskets of currency pairs is quite interesting, since risk and emotional load are reduced. It will suit people with a calm temperament. But beginners looking for a grail with a 146% probability of profit are out of luck)

Sincerely, Pavel TradeLikeaPro.ru