MetaTrader 4 trading strategy based on the OsMA indicator overbought and oversold
Multicurrency strategy - suitable for any currency pairs, as well as for trading metals, options and cryptocurrency (Bitcoin, Litecoin, Ethereum, etc.)
Trading can be conducted on any timeframe.
Depending on your preferences, you can use both scalping and intraday, as well as medium-term and long-term.
The basis for opening trades is the oscillator indicator OsMA overbought and oversold (obs)
Trading can be conducted using this indicator alone.
Ditto for the filtering of weak signals and for more accurate billing of Stop Loss and Take Profit can be used Channel indicator The channel
Now we will take a closer look at one of the simplest options for opening trades, using overbought and oversold levels.
And at the end of the article you can download a ready-made template with all the settings, as well as links to the indicators themselves with the possibility of free testing.
Installation and Setup
Learn more about how to choose, install, test for free, as well as buy indicators, watch on YouTube in the training videos
The settings described in this manual are indicated for the EURUSD currency pair.
Other tools may require additional adjustment of the indicator parameters.
Experimenting a little, you can choose the settings for any trading tool.
Other tools may require additional adjustment of the indicator parameters.
Experimenting a little, you can choose the settings for any trading tool.
Settings indicator OsMA obs :
FastEMA = 12
SlowEMA = 26
SignalSMA = 9
ExtPeriod = 100
Line_or_Histo = True
SlowEMA = 26
SignalSMA = 9
ExtPeriod = 100
Line_or_Histo = True
Settings indicator The channel :
Channel_Period = 34
Channel_Width = 1.618
Channel_Width = 1.618
Conditions for opening deals
The output of the OsMA obs indicator in overbought and oversold areas of 70 or -70 is the main signal to open trades
- when the indicator reaches level 70, the possibility of opening a Sell or Put order is considered (for options)
- when the indicator reaches the level of -70, the possibility of opening Buy or Call orders is considered (for options)
The direction of opened deals should correspond to the trend direction on a higher timeframe.
If you trade on M1 or M5, then you should focus on M30 and H1.
When trading on M15, M30 and H1, we focus on H4, D1 and W1, respectively.
The exit from the transaction is carried out on the opposite signal or when the indicator reaches level 0.
You can also close half of the order at level 0, and the remaining half when you reach the opposite level.
Or according to the established orders SL and TP.
When using SL and TP, it is advisable to set SL for the nearest extremum, and TP to be equal to from 1 to 2 SL sizes.
If you trade on M1 or M5, then you should focus on M30 and H1.
When trading on M15, M30 and H1, we focus on H4, D1 and W1, respectively.
The exit from the transaction is carried out on the opposite signal or when the indicator reaches level 0.
You can also close half of the order at level 0, and the remaining half when you reach the opposite level.
Or according to the established orders SL and TP.
When using SL and TP, it is advisable to set SL for the nearest extremum, and TP to be equal to from 1 to 2 SL sizes.
When trading in a similar way, you can increase the profitability of the system using an additional channel trading filter.
For this purpose, suitable channel indicator The channel
For this purpose, suitable channel indicator The channel
It greatly improves the accuracy of inputs and filters out weak signals.
The rules for opening orders are as follows:
The signal for opening a Sell or Put order (for options) is
- achievement indicator OsMA obs level 70
- price reaching the nearest upper (green) border of the channel indicator The channel
The SL order is placed on the outer upper (red) border of the channel
Order TP is placed on the middle (yellow) line or on the opposite nearest lower (green) border of the channel
Order TP is placed on the middle (yellow) line or on the opposite nearest lower (green) border of the channel
The signal for opening Buy or Call orders (for options) is
- OsMA obs achievement of -70 level
- the price reaching the bottom (green) border of the channel indicator The channel closest to the price
SL order is placed on the outer bottom (blue) border of the channel
Order TP is placed on the middle (yellow) line or on the opposite nearest lower (green) border of the channel
Order TP is placed on the middle (yellow) line or on the opposite nearest lower (green) border of the channel
It is recommended to work with this strategy only with reliable and proven brokers. Who have no problems with the withdrawal of funds.
It is also desirable that ECN has accounts with a low spread and a low commission per transaction.
Before you decide to open a trading account, be sure to read online reviews about your broker.
Well, if you have difficulties with choosing a company, then in my blog you can find brokers with whom I personally work .
These companies can be trusted; for more than seven years of experience working with them, no problems have arisen.
Always adequate trading conditions, quality support and quick withdrawal.
Choose any of them: LIST HERE
Indicators and template
- OsMA indicator obs
- The channel indicator
- Template with settings TS OsMA obs + The Channel
