Momentum Forex Trading: A Session-Based M15 Strategy
The “Momentum Forex Trading” strategy is a trend-following system designed for active traders during the London and New York sessions. It combines Simple Moving Averages (SMA) to determine trend direction with the Momentum indicator to trigger entries, using RSI specifically for precise exits.
Strategy Profile
Best Sessions
London & New York
Timeframe
M15 and Above
Indicators
SMA + Momentum + RSI
1. Indicator Setup
Configure your chart with the following settings:
- Trend Filter 1: Simple Moving Average (SMA), Period 21 (Orange).
- Trend Filter 2: Simple Moving Average (SMA), Period 11 (Blue).
- Entry Trigger: Momentum Indicator, Period 30 (Add a horizontal line at level 100).
- Exit Signal: Relative Strength Index (RSI), Period 14 (Standard levels).
2. Long Entry (Buy) Rules
Execute a Buy trade when trend and momentum align:
- Trend Condition: The 11 SMA (Blue) must be ABOVE the 21 SMA (Orange).
- Price Action: The candlesticks must be floating ABOVE both moving average lines.
- Trigger: The Momentum indicator line crosses the 100 level from bottom to top.
3. Short Entry (Sell) Rules
Execute a Sell trade under these conditions:
- Trend Condition: The 11 SMA (Blue) must be BELOW the 21 SMA (Orange).
- Price Action: The candlesticks must be floating BELOW both moving average lines.
- Trigger: The Momentum indicator line crosses the 100 level from top to bottom.
Exit Strategy (RSI Based)
This strategy uses the RSI solely for exiting positions to maximize profit retention:
- Exit Buy: Close the trade when RSI enters the Overbought zone (above 70).
- Exit Sell: Close the trade when RSI enters the Oversold zone (below 30).
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