(+) Scalping Strategies

HIT & RUN FOREX TRADING STRATEGY

Using the SMA (50) and Parabolic SAR to scalp the EURUSD and GBPUSD pairs on the M1 timeframe.

 TRADING STRATEGY

■ Style: Scalping Strategy

■ Name: Hit & Run Forex Trading Strategy

Note: 

(1) The strategy produces low reward-to-risk trades, which can be unfavorable for most intraday traders.

💱 FINANCIAL ASSETS

■ EUR/USD best (and GBPUSD)

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 TIMEFRAME

■ M1 timeframe (1-Minute)

■ 30 daily trades on average

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 INDICATORS & SETUP

This strategy uses the Parabolic SAR and a simple Moving Average (SMA):

■ Parabolic SAR

At a Glance: The Parabolic SAR

The Parabolic SAR (Stop and Reverse) is designed to identify potential trend direction and exit points. Its primary role is to serve as a dynamic trailing stop-loss that adjusts based on price movement. As the trend progresses, the dots move closer to the price, increasing the indicator’s sensitivity. A crossover of the price and Parabolic SAR dots signals a possible trend reversal, advising traders to close existing positions and reverse their trades (e.g., sell when long, buy when short).

The Parabolic SAR works best in strong trending markets, helping capture momentum and manage risk. However, it tends to produce false signals or whipsaws during sideways or choppy market conditions.

Settings: (default)

1. Acceleration 2%
2. Maximum Step 20%

■ Simple moving average (SMA)

Settings:

• Settings: 50 periods

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 TRADING SIGNALS

This is how you can implement the Hit & Run Strategy:

• The SMA is used to identify the trend, while the Parabolic SAR serves as the entry trigger.

• The Parabolic SAR provides the entry signal.

■ (↑) Long Trades

• When the EURUSD price is above the SMA (50), the momentum is considered bullish, and we prepare a long (bullish) trade.

• When EURUSD moves above the Parabolic SAR, it triggers the long trade.

■ (↓) Short Trades

• When EURUSD is below the SMA (50), we prepare a short (bearish) trade.

• When EURUSD moves below the Parabolic SAR, it triggers the short trade.

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 TRADING ORDERS

Here is how we set our trades using the Hit & Run Strategy:

■ Take Profit: 8-12 pips

■ Stop-Loss: 12-15 pips

■ Profit/Loss Ratio: 0.65 (very low)

Note: During a highly volatile session, like the EURUSD session shown on the chart, you may use higher take-profit levels or even trailing stop-loss orders.

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CHART: Hit & Run Forex Trading Strategy

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■ Hit & Run Forex Trading Strategy

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