In order to make my free signals on the major pairs easier to read and understand, I am setting out here my trade entry criteria in detail.
A signal may detail a “touch trade”. This means that the pair should be bought or sold at a given price if that price is reached within a specified time frame, regardless of the price action that occurs when the price approaches the entry level. These trades will always include an entry price and a stop loss and are easy to “set and forget”. In fact, if your broker’s platform includes an option to set a date and time after which the limit order is automatically deleted, you do not even have to worry about deleting the trade. All of the signals have an expiry date and time.
Most of the signals given are not “touch trades”, but require confirming price action. For these trades, the signal will specify a price level. If and when the price reaches this level, there must be price action confirmation on the H1 (hourly) chart before entry is taken.
The confirmation must be in the form of a closed pin bar or engulfing bar.
Pin Bar
A pin bar is defined as a bar that both opens and closes within either the top quarter of its range (bullish pin bar) or the bottom quarter of its range (bearish pin bar).
Engulfing Bar
An engulfing bar is defined simply as a bar that reverses the direction of the close from open of the previous bar, and closes beyond the previous bar’s open. For example, if an hourly bar opens at 99.99 and closes at 99.89, and then the subsequent bar closes at 100.00, that subsequent bar is a bullish engulfing bar.
Trades should not be entered as soon as a confirmation bar has closed. Instead, entry may only be made if a bullish bar is broken to the upside by at least 1 pip before the next bar closes and also before its low is breached. The same applies, in reverse, to bearish bars.
It will also be specified in the signal that the trade may only be taken during a certain period of time after an hourly bar closes beyond the given support or resistance level.