Channel Trading Strategy Stochastic With Regression – ForTrader.org Financial Magazine


Stochastic With Regression Channel Trading Strategy Is a simple system based on the idea that prices always tend to return to the central region of the regression channel.

Input parameters

  • Currency pairs: any
  • Timeframe: M5 and higher, optimal – H4 and D1
  • Trading time: any
  • Risk management: choose such a lot size that the risk is no more than 2-5% of the deposit per trade

Indicators used

  • Linear regression (LR period 60, STD 1 0.618, STD 2 1.618, STD 3 2.618)
  • HMA with arrow and alert (15)
  • Stochastic Oscillator (5, 5.5)

Installing indicators and system template

  • Unpack the archive with templates and indicators
  • Copy the indicators to the MQL4 folder -> indicators
  • Copy the templates to the templates folder
  • Restart the terminal
  • Opening the chart of the required currency pair
  • Install a template named Stochastic With Regression

The graph should look like this:

Stochastic With Regression Trading Strategy Template

Signals indicating the opening of a buy position

  • the price is below the red channel;
  • a blue up arrow appeared;
  • Stochastic lines cross from bottom to top.
Stochastic With Regression Channel Trading Strategy
Example of entering a buy trade

Signals indicating the opening of a sell position

  • the price is above the red channel;
  • a red down arrow appeared;
  • Stochastic lines cross from top to bottom.
Stochastic With Regression Channel Trading Strategy
Example of entering a sell trade

Setting stop loss and take profit

  • stop loss is set above / below the previous local high / low;
  • take profit is set at a ratio of 1.15: 1 to stop loss.

Before using the Stochastic With Regression trend trading strategy on a real deposit, we recommend testing it on a demo account.

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