This is not one of those regular articles you may have come across on how to detect Spikes on Boom and Crash Indices. This is a little bit different. For the record, there is no 100% strategy on how to detect Spike on Crash and boom indices, but if you apply the strategy I am going to share below you will make at least 10% of your investment daily.
Please note: Trading forex is not a get rich quick scheme. I have to bring this one up early so that new traders who are often being misled by the so-called YouTube forex millionaires will understand that trading and making good sustainable income from Forex takes time, money and many blown accounts.
Secondly, there is no strategy that is 100% perfect, if you can develop a 89% strategy with good money-risk reward ratio you will make good return on your investment.
How to detect Spikes on Boom and Crash Indices
Early last year, I enrolled for two different courses by self two acclaimed masters of Spike detectors, I paid $200 for the first class, paid $100 for the second class. Just like most traders, I was very eager and curious to learn new tricks which could make me a millionaire in two months or less.
The first trader informed me that the secret of detecting spike was using RSI number and monitoring the overbought and oversold zone on the RSI. He told me that if the RSI (period 14) number on M1 is close to 99 that I can place a sell trade because it will definitely spiked before getting to 100.
And if the RSI number on M1 was close to 1.00, that I should place a buy trade, that spike will come before the RSI number gets to 0.00. The strategy was 80% successful when I started the practice, but I had to made some adjustment to increase the accuracy to 83%.
The second trader told me to concentrate on Price action and understand the major zone( support and resistance) then place my buy or sell limit on those areas. I practice the strategy for days, putting Buy/Sell limit and Take profit plus a $5 stop loss for each limit. The success rate was amazing, I only lost two trades out of close to 120 trades using that strategy.
The way forward.
- Fund your account with at least $100
- Set RSI period 14 on your chart
- Add 200 EMA to your main chart
- Study the market structure (If you don’t understand this one, then you have no business in the market
- Note major support and resistance zone on the chart (write them out)
- Monitor your RSI number on one minutes timeframe, once it get close to that zone; sell when the RSI number on crash is at 98; buy when the RSI number on one minutes chart is at 1.00
- Put Tp and stop loss of at least $3- $5 depending on your equity.
- Don’t be greedy, always take profit and adjust your stop lose based on market condition.
Please, apply proper risk management, that is the strategy i have been using and it has been working for me. If you need any tutorial kindly indicate in the comment section