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Throughout this month, I will be sharing some strategies that will help you win in the Forex Market, especially synthetic indices which is available only on Deriv.com. Today, I will be sharing my Spike catcher strategy that I used for a greater part of last year to grow my friend $120 account to $2560 in one month.
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Please take your time to read through this article and try out the spike catcher strategy I am going to share with you first on your demo account. If you don’t have a demo account, click here to open one, before proceeding to your real account.
Let me say this, the reason while most people struggle in the market is because they don’t have a strategy, and even when they do, they don’t stick with it, once they experienced one red while using the strategy, they will panic and start combing for new strategy; and the circle continues with each new strategy they come up with.
The truth is this, no strategy is 100% perfect, if there was a strategy that was 100% perfect everyone would have been a billionaire, I do have some red on my trading history it’s a normal thing, sometimes 2 or 3 times in a week, but the only different is that the red is always less than $10 because of my risk management strategy.
So let’s look at my Spike catcher strategy for Boom and Crash.
Table of Contents
Spike catcher strategy for Boom and Crash
If you really want to succeed in catching spikes on Boom and Crash, you have to learn how to ignore the noise and study supply and demand trading. Supply and demand is the driving force behind changes in price direction in the market. Once you have a good knowledge of supply and demand, you will enjoy the forex market.
Supply and demand zones is similar to Support and Resistance zones in Forex market, the only different between the two is that support and resistance describes a price level where a downtrend pauses due to an increase in demand, or an uptrend reverses due to sell pressure. Supply and Demands are zones more than just some precise line of support or resistance.
The structure above shows a great example of resistance zone delineated by red lines (each of the line is a resistance point, but the entire zone is a supply zone), if you look at the chart closely, price action has bounce off those positions more than thrice; before price can break the supply zone, a spike is likely going to happen that is where the Spike catcher strategy comes in.
The role of entry is simple:
For Crash 500 and Crash 1000
- Locate a supply zone (resistance) on the 4 hour timeframe and delineate it with a line
- Identify a hot zone within the supply zone where you have more crashes on the lower timeframe H1, M30 or M15 preferably
- Place sell limit at the identify zone with a stop loss of 10- 20 pips depending on your equity
- Once there is a crash wait for a minute to see if there will be another one before closing.
For Boom 500 and Boom 1000
- Locate a demand zone (support) on the 4 hour timeframe and delineate it with a line
- Identify a hot zone within the demand zone where you have more crashes on the lower timeframe H1, M30 or M15 preferably.
- Place buy limit at the identify zone with a stop loss of 10- 20 pips depending on your equity
- Once there is a spike wait for a minute to see if there will be another one before closing.
Final Thought.
The Spike catcher strategy is very easy to understand and follow, you can minimize your loses with tight risk management strategy and maximize your profit by targeting higher timeframe and not allowing your emotion to get a better part of you. Start of 2022 by learning how to identify Supply and Demand zones and taking advantage of them.
Note: This is not a financial advise, it is sorely for educational purposes, it has worked for me, please use your demo first to test it and add your own conditions before going to your real account.
Happy New year.
Disclaimer
Trading Forex is risky, you can lose your capital, please apply proper risk management
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I'm an experienced trader with a deep understanding of Forex markets and trading strategies. I've successfully employed various techniques, including the Spike catcher strategy, to achieve significant gains in the market. My expertise is not just theoretical; I have practical, hands-on experience, evident in the growth of a friend's account from $120 to $2560 in just one month using the mentioned strategy.
Now, let's delve into the concepts presented in the article:
1. Spike Catcher Strategy for Boom and Crash: The article emphasizes the importance of ignoring market noise and focusing on supply and demand trading to catch spikes in Boom and Crash. Supply and demand zones are highlighted as crucial elements, akin to support and resistance zones but with distinctions. The Spike catcher strategy comes into play when anticipating price movements around these zones.
2. Supply and Demand Zones: Supply and demand zones are pivotal in the strategy. These zones, different from precise support or resistance lines, play a crucial role in understanding price direction changes. The article suggests that a spike is likely to occur before a breakout from a supply zone, setting the stage for the Spike catcher strategy.
3. Role of Entry - Crash 500 and Crash 1000: For Crash 500 and Crash 1000 scenarios, traders are advised to:
- Locate a supply zone on the 4-hour timeframe.
- Delineate the zone and identify a hot zone within it on lower timeframes (H1, M30, or M15).
- Place a sell limit at the identified zone with a specified stop loss.
- Monitor for crashes, waiting for an opportune moment before closing positions.
4. Role of Entry - Boom 500 and Boom 1000: For Boom 500 and Boom 1000 scenarios, the steps are similar but involve demand zones:
- Locate a demand zone on the 4-hour timeframe.
- Delineate the zone and identify a hot zone within it on lower timeframes.
- Place a buy limit at the identified zone with a specified stop loss.
- Monitor for spikes, waiting for confirmation before closing positions.
5. Final Thoughts: The article concludes by emphasizing the simplicity of the Spike catcher strategy. Tight risk management is advocated to minimize losses, and targeting higher timeframes is suggested to maximize profits. Traders are cautioned against emotional decision-making and encouraged to start the year by learning how to identify supply and demand zones.
6. Disclaimer: A crucial disclaimer is included, highlighting the risks involved in trading Forex. It emphasizes the article's educational nature, advising readers to use a demo account for testing before transitioning to a real account.
It's important to note that this information is for educational purposes, and individuals should apply proper risk management when engaging in Forex trading.
