Simple trading strategy of Stochastic indicator

This is a simple stochastic trading strategy. This strategy can be used in any time frame. So this is suitable for scalping trading. Beginners can follow this simple strategy. You will get many signals from this strategy. You can gain huge pips from every month with this trading system.


Required indicator:

Stochastic Oscillator. see how to set Stochastic Oscillator.


How to get buy signal

You have to find buy signal when stochastic indicator stays at oversold area. 20 level of this indicator indicates oversold area. When a crossover occurs on 20 level, then you can buy. You can wait for a bullish candle for confirmation of your buy entry.


How to get Sell signal

You have to find sell signal when stochastic indicator stays at overbought area. 80 level of this indicator indicates overbought area. When a crossover occurs on 80 level, then you can sell. You can wait for a bearish candle for confirmation of your sell entry.





Time frame: Any time frame. H1, H4 are recommended.


Currency pairs: Any pairs.


Take profit and Stop loss: Take profit will depend on the time frame. You have set short take profit for scalping trading. If you trade on H1 or H4, you can set take profit 50-80 pips.

You have to set stop loss below the swing low for buy entry and above the swing high for the sell entry.


Risk warning: This strategy is based on only one indicator. So you can need candle confirmation for safety trading. You should not trade on ranging market with this strategy. In news time, you have to avoid this strategy. You need to trade on this strategy with your own risk. You must follow money management. In this strategy, you need to take 1-2% risk only for every trade. Though this is simple trading system, you need to practice this strategy in your demo account before using this on real account.