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CCI Chandelier Trend Forex Trading Strategy

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CCI Chandelier Trend Forex Trading Strategy

Many people who are not into trading often associate trading with gambling. For trader wannabes who do not know what they are doing, this might be true. However, real traders know for certain that this could not be further from the truth. Gamblers play the game of chance, while traders play the game of probabilities. Gamblers wish for luck, while traders seek an edge.

How do traders develop an edge? It is through strategies and technical analysis that have a high probability of resulting in a win. It is about winning more often than losing or winning bigger gains compared to what you are losing.

Many traders develop an edge through careful analysis of each trade. Other traders develop an edge using technical indicators that have a high probability of resulting in a trend. This allows traders to win bigger gains compared to their losses.

The CCI Chandelier Trend Forex Trading Strategy is a strategy that banks on indicators that have a high probability of resulting in a trend. It allows traders to have high reward-risk ratio which means more gains compared to the losses.

Chandelier Exit

Table of Contents

Chandelier Exit (CE) is a strategy used to set or trail stop losses in order to protect profits. It incorporates trend direction, momentum and volatility.

The Chandelier Exit method makes use of the Average True Range (ATR) as a basis for setting stop losses. Stop losses are typically trailed at three times the ATR. The theory is that if price breaches the said trailing stop loss, then the trend is considered to have reversed.

The Chandelier Exit indicator is a custom indicator based on this idea. The Chandelier Exit indicator detects the trend direction and draws a line behind the trend based on the ATR. This determines the trend direction.

On a bullish trending market, the indicator prints an orange line below price, while on a bearish trending market, the indicator prints a magenta line above price. The indicator usually changes color as price crosses over the line. This indicates that the previous trend has ended and that a new trend might be developing.

CCI Woodies

The CCI Woodies is a custom technical indicator based on the Commodity Channel Index (CCI) indicator.

This indicator takes into account the average of the high low and close of price as opposed to other indicators that makes use of only one of the three components of a price candle. This average is called the Typical Price.

The CCI is computed based on the Typical Price. A Simple Moving Average of the Typical Price is then subtracted from the current Typical Price and adjusted for deviations.

The CCI is an oscillating indicator based on momentum. CCI values that are negative indicate a bearish market condition while CCI values that are positive indicate a bullish market condition. As such, the CCI crossing from positive to negative or vice versa indicates a trend reversal.

The CCI Woodies indicator is a variation of the CCI which has two CCI lines. The longer-period line is considered as the Trend CCI while the shorter-period line is called the Signal CCI.

Trading Strategy

The CCI Chanelier Trend Forex Trading Stratgy is trend reversal indicator based on the confluence of the Chandelier Exit indicator and the CCI Woodies indicator.

Trend reversal signals are developed whenever the Chandelier Exit indicator reverses, while the CCI Woodies indicator crosses from positive to negative or vice versa.

This strategy is best used in a market that has a strong tendency to trend. It is also best used when the reversal is an area of support or resistance on the higher timeframes.

Indicators:

  • CCI_Woodies
    • CCI Period 1: 32
    • CCI Period 2: 24
  • ChandelierExit (default setting)

Preferred Time Frames: 1-hour, 4-hour and daily charts

Currency Pairs: major and minor pairs

Trading Session: Tokyo, London and New York session

Buy Trade Setup

Entry

  • The Chandelier Exit indicator line should change to orange and should shift below price indicating a bullish trend reversal.
  • On the CCI Woodies indicator, the Trend CCI (Steel Blue) and the Signal CCI (Red) lines should cross from negative to positive indicating a bullish trend reversal.
  • These bullish trend reversal signals should be closely aligned.
  • Enter a buy order on the confluence of the above conditions.

Stop Loss

  • Set the stop loss on the support level below the entry candle.

Exit

  • Close the trade as soon as price closes below the Chandelier Exit indicator.
  • Close the trade as soon as the Chandelier Exit line changes to magenta.
  • Close the trade as soon as the Signal CCI line crosses below zero.

CCI Chandelier Trend Forex Trading Strategy

CCI Chandelier Trend Forex Trading Strategy

CCI Chandelier Trend Forex Trading Strategy 2

CCI Chandelier Trend Forex Trading Strategy 2

Sell Trade Setup

Entry

  • The Chandelier Exit indicator line should change to magenta and should shift above price indicating a bearish trend reversal.
  • On the CCI Woodies indicator, the Trend CCI (Steel Blue) and the Signal CCI (Red) lines should cross from positive to negative indicating a bearish trend reversal.
  • These bearish trend reversal signals should be closely aligned.
  • Enter a sell order on the confluence of the above conditions.

Stop Loss

  • Set the stop loss on the resistance level above the entry candle.

Exit

  • Close the trade as soon as price closes above the Chandelier Exit indicator.
  • Close the trade as soon as the Chandelier Exit line changes to orange.
  • Close the trade as soon as the Signal CCI line crosses above zero.

CCI Chandelier Trend Forex Trading Strategy 3

CCI Chandelier Trend Forex Trading Strategy 3

CCI Chandelier Trend Forex Trading Strategy 4

CCI Chandelier Trend Forex Trading Strategy 4

Conclusion

This is an excellent trend reversal strategy based on a confluence of two high probability indicators. It produces trade entry signals that tend to trend. Entries that result in a trend typically produces gains which are usually more than twice the risk placed on the trade.

To improve the win rate of this strategy, it is best to take trade signals that are on a support or resistance area on a higher timeframe.


Forex Trading Strategies Installation Instructions

CCI Chandelier Trend Forex Trading Strategy is a combination of Metatrader 4 (MT4) indicator(s) and template.

The essence of this forex strategy is to transform the accumulated history data and trading signals.

CCI Chandelier Trend Forex Trading Strategy provides an opportunity to detect various peculiarities and patterns in price dynamics which are invisible to the naked eye.

Based on this information, traders can assume further price movement and adjust this strategy accordingly.

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How to install CCI Chandelier Trend Forex Trading Strategy?

  • Download CCI Chandelier Trend Forex Trading Strategy.zip
  • *Copy mq4 and ex4 files to your Metatrader Directory / experts / indicators /
  • Copy tpl file (Template) to your Metatrader Directory / templates /
  • Start or restart your Metatrader Client
  • Select Chart and Timeframe where you want to test your forex strategy
  • Right click on your trading chart and hover on “Template”
  • Move right to select CCI Chandelier Trend Forex Trading Strategy
  • You will see CCI Chandelier Trend Forex Trading Strategy is available on your Chart

*Note: Not all forex strategies come with mq4/ex4 files. Some templates are already integrated with the MT4 Indicators from the MetaTrader Platform.

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