How to trade on the forex by using the sirloin outside bar

Outside candlestick pattern

I decided to look at the tooth of one of the strongest candle called outside candles. I will give you several ways to trade this formation we came to the conclusion that it would be best to break the articles on the series. Now, I will introduce the most basic way to trade on the forex by using the sirloin outside bar. Outside bar is a candle formation made up of two candles, one smaller and the other larger, or the parent, the smaller one embraces. But not every candle that embraces the previous candle is an outside bar. As can be seen in the picture, it is first time on the reverse formation. If we say it is a reverse formation, then it should be logically located near each highs or lows. The key to the success of any trading strategy based on sirloin formation is the correct determination of formation, location and money-management. All of these categories will be addressed in this article.

How to know the formation

There is no outside bar as an outside bar. For trading outside bars, we have set some inherent conditions that make your business plan clever.

Before we go to the bear bar outside the bar, we check the following factors

– Is the high outside candles higher than the high candles?

– Is the low outside candles lower than the low candles?

– Has the outer bar formed a resistance?

– Is the price close to the minimum? (here ideally in the lower quarter of the candle, ie if we stretch the Fibonacci’s return on the outer candle, then the closing price must be between 0-23.6)

– Is the candle in a trendy environment (ie there is no consolidation market)?

– Is the candle visibly larger than a few previous candles?

– If we answer all the above questions positively, then we know that the outside bar has met the qualification criteria and we can open a new short position.

Before going to the bull bar, we also have to check the following criteria:

– Is the high outside candles higher than the high candles?

– Is the low outside candles lower than the low candles?

– Was the outer bar on the support?

– Is the price close to the maximum? (here ideally in the upper quarter of the candle, ie if we stretch out the Fibonacci’s return on the outer candle, then the closing price must be between 0-23.6)

– Is the candle in a trendy environment (ie there is no consolidation market)?

– Is the candle visibly larger than a few previous candles?

– Here is the same thing that applied to the bear’s outer bar, we open the new store when all conditions are met at the same time.

The right location

Candle formations are not a very successful strategy for themselves, a good strategy makes them perfect location and timing. Merchants should not blindly trade any formation they see in the market but should know in advance the levels on which the formation should appear. Therefore, it is important that we always look for the outside candle on a predetermined resistance or support.

Good money-management

The last slice in the puzzles of a successful strategy is money management. This formation allows several ways to enter the market. Today we will introduce the most basic trace command. Take-profit we try to choose according to the nearest technical standards, always so that our risk reward ratio reaches positive values.