Three Screens of Helder forex trading strategy with a beard
The Three Screens organization strategy was developed by Alexander Elder, an expert in trading and stock trading. The strategy gained its recognition when it was published in "Futures" magazine.
Due to its simplicity and accuracy of signals, it rapidly gained popularity among traders around the world. For many years Elder 's child has been tested for strength in different markets, which only increases confidence in this forex trading strategy.
The Essence of the Three Screens forex trading strategy
The point is to check the tool using graph analysis, which is carried out using three screens. Each transaction will be filtered on different time lines that are displayed on each screen.
If the deal met the requirements of each of the screens, the probability of its success is high!
The main tools in the Three Elder Screens strategy are trend indicators and oscillators. They will help you identify a powerful flow and select the right entry point.
Indicators of trends and oscillators you can choose for your taste, there are no strict restrictions.
Typically, a moving average is used as a trend tracking. It shows quite clearly the trend that you, in principle, need. But each indicator has shortcomings. For example, the moving average is good when there is a trend, but when the market is in the price corridor - it gives false signals that are not true.
Technical analysis indicator - oscillator
In the Three Screens forex trading strategy, the purpose of this indicator is to determine the levels of overbought or resale of the market.
When the market is in a state of overbought, its further growth is difficult, and the probability of a downtrend is high. When the market is resold, exactly by turnover - there is a high probability of an upward trend.
Using these indicators, it can be concluded that when the market is overbought, it is necessary to open deals for sale, and when resold for purchase.
Choice of a taymfreym
Starting to reconcile graphs on different time ranges, you may encounter inconsistent graphs. For example, the daily chart shows a confident bullish trend, and the weekly can upset you by showing a stable bear movement.
By adopting the "Three Screens" strategy, you need to analyze at the same time 3 graphics with different scales. When choosing timeframe, you should be guided by factor 5. I.e. Larger or smaller scale is multiple of 5 with respect to the main scale.
If we take the D1 schedule as a basis, the W1 schedule will be big, and the smaller one... I won 't tell you, I need to figure it out. Currency wound works 24 hours a day, therefore: 24/5 - a smaller schedule will be H4.
The first point of the forex trading strategy is to analyze the graph of larger scale. This helps the trader determine the main trend movement. Use the MACD indicator tool to detect a trend.
It is important for the trader not to miss the change in the slope of the MACD indicator, as if the market trend changes, the chance of a successful deal increases.
Also, the moving average EMA indicator with a period of 13 must be present on the schedule of the 1st screen, it is necessary to resolve the inconsistencies.
At this stage, we detect the state of market purchase or resale, and depending on the analysis carried out, we make deals.
After the analysis of the first two screens, the trader has an understanding of what he is going to do: open a deal or not. This screen does not require any indicators, due to its small scale.
It is enough to put on deferred warrants regulating entry into the market.
The Three Screens forex trading strategy has proved reliable for decades. It can also help you create your own strategy. The main thing you have to do is adopt the essence of the strategy, which is to check transactions in several stages.
Due to the complexity of the market, applying the "Three Screens" strategy in pure form may not always be profitable, so additional filtering is required. You can combine different strategies or indicators, it will improve your result. It is recommended to use Three Screens in conjunction with Price Action trading methods.