Forex MT4/MT5 Indicators Forex Indicators Download Free w pattern trading strategy is a very simple, yet effective trading strategy that can be used to trade stocks, commodities, and Forex. The w pattern is formed by two consecutive bullish or bearish candles, with the second candle forming the “W” shape. This pattern can be used to signal a change in trend or to enter into a trade.
The w pattern trading strategy can be used Semafor Indicator as a standalone trading system or as part of a larger trading system. When used as part of a larger system, the w pattern should only be used as a confirmation signal. A buy or sell order should not be placed unless there is also another confirming indicator or pattern.
The w pattern can be found on any time frame, but is most commonly found Avramis River Indicator on the daily or 4-hour charts. The w pattern can also be used to trade short-term swings in the market, or to trade breakouts.
When trading the w pattern, there are two main rules that should be followed
- The first candle in the w pattern should be a bullish or bearish candle that closes near the high or low of the day.
- The second candle in the w pattern should form the “W” shape and should close near the middle of the day.
The following chart shows an example of a bullish w pattern
As you can see, the first candle is a bullish candle Profitable Indicators that closes near the high of the day. The second candle is a bearish candle that forms the “W” shape and closes near the middle of the day. This pattern can be used to signal a change in trend or to enter into a trade.
The following chart shows an example of a bearish w pattern
As you can see, the first candle is a bearish candle that closes near the low of the day. The second candle is a bullish candle that forms the “W” shape and closes near the middle of the day. This pattern can be used to signal a change in trend or to enter into a trade.
When trading the w pattern, it is important to wait Price Action Strategy for confirmation from other indicators or patterns before entering into a trade.
For example, the following chart shows an example of the w pattern along with other signals that can be used for this system:
As you can see in the above chart, there are two bullish w patterns shown, but both of these should not have been traded because they did not have any confirmation from other indicators or patterns. The only valid signal was the bearish Gold Indicator divergence confirmed by the bearish engulfing candle. After seeing this bearish engulfing candle form on March 7th, selling short would have entered you into a profitable trade. This is just one example of how trading systems work together to increase your odds of making profitable trades or investments.
The following charts show of buying and selling w patterns.
