Timeframe: any, priority from M15 to H4
Currency pairs: any trend
Indicators : VSA – Better Volume4, ATR
Platform: MetaTrader 4
Recommended broker for applying the strategy: Alpari , RoboForex
Surely experienced traders often received a stop-loss , which literally shadowed the candle worked, and after that, the price went in the right direction, moreover, it easily reached the potential take profit. At such times, it seems as if market makers know where your protective order is set and have deliberately pulled the price to knock it out. In fact, you simply fell into the trivial traps of large players, who thus removed the position of a huge number of traders, then with the least resistance moved the price in the right direction.
If market makers did not perform this kind of market deception, it would be too easy to trade, and most of the players would go in the right direction. But large traders with naive traders with minimal deposits need to be closed in order to gain a position and fool the crowd.
In this review, we will look at Prometheus’ efficient trading system, which is based on the identification of such traps for market makers. A great option to work in the direction of large players and take part of the profits from the strongest movements.
For trading, the basics of volumetric analysis using the VSA indicator are used. The main principle of the strategy is to identify the most cherished climax zones in a growing and declining market. The climax zones are the points of imbalance of supply and demand, at which major players are recruiting positions. As a rule, such zones are formed before the market reversal and are accompanied by strong volumes with outliers in the direction of the main trend.
Basics of trading strategy
For trading on Prometheus forex system, the VSA Better Volume indicator is used, which displays the maximum volume spikes on the climax of purchases or sales. When a critical maximum volume appears at the maxima or minima of the trend movement, this with a high degree of probability may indicate a trend reversal soon. This is especially effective if a position was set before the burst – a small flat.
The Better Volume indicator signals the climax of purchases with a red histogram, which gives a sell signal, if before that there was a pronounced upward trend. If a large volume appears on a downtrend – the culmination of sales, the indicator depicts a white histogram, which is a signal to buy.
To trade in a strategy, you must wait for the formation of an obvious downtrend or uptrend.
As a rule, large players first create a climax — flat with accumulation, after which they endure the volume of all players with small feet, and then the reversal trend follows. That is why a double top or double bottom is often formed before the turn.
Rules for purchase
To buy an asset on the strategy of Prometheus, you should wait for the following signals:
- Determine the visible downtrend
- Wait for a voluminous candle after dialing, which will be the culmination of sales. Histogram The Better Volume indicator should draw a white division.
- We get confirmation, which is expressed by the appearance of the next candle with a high volume, but a small spread – the body. It is recommended that the confirmation candle be in the opposite direction, i.e. ascending.
- Set pending order at the minimum of the climax of the candle.
Rules for sale
- We are waiting for the formation of a bright-shown uptrend
- We are waiting for the climax of the purchases – volume carry-over after a small flat. The signal of the climax of the purchases will be the coloring of one division of the Better Volume indicator in red.
- We determine the confirmation of the signal – we are waiting for a downward candle with a high volume, but a small spread.
- We put a pending order to sell at the maximum of the climax of the candle.
The stop loss is set to the size of the average candlestick of the selected timeframe. To determine the ATP, you can set the indicator or calculate it yourself. At the same time, the protective order should be several points higher than the shadow of the climax candle. Thus, the second test of the climax zone will not close your stop-loss.
Take profit should be set at a distance equal to three feet. But you should also consider the presence of support and resistance levels on the way of movement. If there are strong zones, it is better to close the position in front of them, or move the stop loss to breakeven, after the price approaches the level.
The Prometheus strategy is suitable for working with any instruments and any time periods, but it is better to limit yourself to intraday trading, due to the use of the Better Volume indicator, which works better on small TFs.
If after entering the position, the price stays in one place for a long time, it is better to close the deal with a small profit or loss, because after the culmination there should be a quick reversal, and the set may indicate a continuation of the trend.