Contents

Introduction ........................................................................................................................................................ 2
Data ................................................................................................................................................................. 2
Short instructions on how to use Forex Tester. .................................................................................................. 2
Sum up ............................................................................................................................................................ 3
STRATEGIES ......................................................................................................................................................... 3
Martingale strategies ...................................................................................................................................... 3
Strategy #1. Martingale Grid & Hedging ............................................................................................................. 4
Buy rules: ......................................................................................................................................................... 4
Sell rules: ......................................................................................................................................................... 5
Strategy #2. Martingale hedging with exponential lot increase ......................................................................... 6
Buy rules: ......................................................................................................................................................... 6
Sell rules .......................................................................................................................................................... 7
Example ........................................................................................................................................................... 7
Price Action strategies......................................................................................................................................... 8
Strategy #3. Simple short-term strategy ............................................................................................................. 9
Buy rules: ......................................................................................................................................................... 9
Sell rules: ......................................................................................................................................................... 9
Strategy #4. Engulfing bars................................................................................................................................ 12
Strategy #5. GBP/USD simple breakout system ................................................................................................ 13
Rules: ............................................................................................................................................................. 13
Strategy #6. Simple “Make Pips” Strategy ........................................................................................................ 15
Buy rules: ....................................................................................................................................................... 15
Sell rules: ....................................................................................................................................................... 15
Strategy #7. The Trader vs. the Coin ................................................................................................................. 17
Strategy #8. Accurate Trading Strategy............................................................................................................. 20
Buy rules: ....................................................................................................................................................... 20
Sell rules: ....................................................................................................................................................... 20
Strategy #9. The Hedging Strategy .................................................................................................................... 22
Examples ....................................................................................................................................................... 22
Strategy #10. The Tsunami Method .................................................................................................................. 23
Introduction
This file contains ten popular and extremely easy strategies that any trader can implement in his or her
trading. At first we suggest you to find out how Forex Tester works (use the Short Instructions from this file
or visit our site: http://www.forextester.com/faq). After that you need to do the following:

 Select the strategy.

 Test it.
 Find out if it fits you.
 Discuss it on different forums (you will find the links in the text).
 Let us know if this file was helpful for you.

Disclaimer: The strategies given below are for demonstration purposes only and should be tested in
Forex Tester before you use them on a real market. Forex market is constantly changing and the strategy
that might work in the past can perform not that good in the future. Also the strategy that is good for one
currency pair can be completely useless for the other pair. One should find his own trading style; determine
the strategy that fits him the most; find parameters that will give the best profit possible.

Data: Forex Tester Software Inc. highly recommends you to use high-quality data and particularly the tick
data. The data of the medium quality is enough for the most of the strategies and it can be downloaded at
our site: http://www.forextester.com/data/datasources

But some strategies require high-quality data only. You can subscribe to this data type here:
http://www.forextester.com/HistoryServiceDescription

Short instructions on how to use Forex Tester.

To start using our backtesting program you need to do the following:

1. Download the program from our site: http://www.forextester.com/download

2. Install it on your computer.
3. Purchase a license from our site: http://www.forextester.com/order
4. Register you Forex Tester with a registration key you receive in email.
5. Run the program.
6. Go to “File -> Data Center” in you History mode.
7. Choose the broker in a dropdown list (in case you did not purchase the data one broker will be
available only)
8. Check the currency pair you want to download.
9. Click on “Update from server” button.
10. Select the data range for which you want to download data and click on “Update”
11. When the data is downloaded for this particular currency pair you can repeat the paragraphs from 8
to 10 for as much times you need it.
Important: please note that you should download the data for ONE symbol at the time.
12. Choose all the currency pairs for which you have downloaded the data and click on “Generate ticks”
button.
 13. Make sure that all the required pairs are checked in the list that appeared.
14. Click on “Generate” button.
Important: please note that you should generate the ticks for ALL symbols at once.
15. Close the “Data Center” window.
16. Switch to the “Testing mode” (the button is situated at the top left corner of the program’s
window).
17. Go to “File -> Add new chart” and pick the currency pairs for which you have downloaded the data
and generated ticks.
18. Click on “Start Test” button.
19. Click on “Pause” button or move using the “Space” button.

Sum up. Please keep in mind these 4 things for starting the test:

1. Download the data.

2. Generate the ticks.
3. Add the currency pairs.
4. Start test.

Now when you know how to work with Forex Tester you can just pick any strategy of those that you will find
below, start testing and immediately discover if this strategy is good or not. To get the most reliable data
from 10 different brokers on 86 symbols use this link:
http://www.forextester.com/HistoryServiceDescription

STRATEGIES
Martingale strategies
A martingale is any of a class of betting strategies that originated from and were popular in 18th
century France. The simplest of these strategies was designed for a game in which the gambler wins his
stake if a coin comes up heads and loses it if the coin comes up tails. The strategy had the gambler double
his bet after every loss, so that the first win would recover all previous losses plus win a profit equal to the
original stake. The martingale strategy has been applied to roulette as well, as the probability of hitting
either red or black is close to 50%.

Martingale strategies divide into two groups. In the first one we use the same lot size; in the second group
we multiply the lot sizes.
Strategy #1. Martingale Grid & Hedging
Currency pair: any
Timeframe: M5
Indicators: Simple Moving Average (100)
Data type: 1-min
Data quality: High (Standard subscription type)
Stop Loss: none
Take Profit: 10 pips (or any other FIXED value)
Projects: none

Buy rules:

1. Draw the levels (red horizontal lines on the screenshot) at the distance of 10 pips one from
another.
2. When the price touches the level from above (at 1.2690 in our example) open a buy order .
3. Set take profit at 10 pips value (at 1.2700).
4. If the price goes up you win 10 pips.
5. If the price goes down and reaches the next level (at 1.2680) – open one more buy order
6. Move the take profit of both trades to the 1.2590 level (the order price of the first trade)
7. If the price keeps moving downwards open the trades each 10 pips.
8. As you see in example we had to open 5 orders, the take profits of them are placed at 1.2690
9. Finally the price reaches this level and we earned: 0 pips from the first order, 10 pips from the
second order, 20 pips from the third order, 30 pips from the fourth order, and 40 pips of the
fifth order. In general we have got 100 pips.
 10. You can place buy limits at a preselected amount of pips below the initial price (Use Forex
Tester’s “Ctrl O” hotkeys to set a bunch of orders at once)

Sell rules:
1. Draw the levels (red horizontal lines on the screenshot) at the distance of 10 pips one from
another.
2. When the price touches the level from below open a sell order.
3. Set take profit at 10 pips value
4. If the price goes down you win 10 pips.
5. If the price goes up and reaches the next level – open one more sell order.
6. Move the take profit of both trades to the order price of the first trade.
7. If the price keeps moving upwards open the trades each 10 pips.
8. Finally all your trades will be closed by take profit if you have a big enough deposit.

Result Positive Negative

Description of It is not necessary to forecast where If you have a small account and stumble upon
the feature/ the market will move. You can enter a powerful countertrend then you can run
problem the trade at any point and still win out of money and lose the entire deposit
Improvement/ Use Trend indicators to avoid Decrease the lot size or increase the distance
Solution activating many trades between the trades

You can discuss this strategy on the Forex Factory’s forum. Make use of this link:
http://www.forexfactory.com/showthread.php?t=497448 and find out more details, meet experienced
traders and find plenty of strategies at any taste.
Strategy #2. Martingale hedging with exponential lot increase
Currency pair: any
Timeframe: H1
Indicators: Simple Moving Average (100)
Data type: 1-min
Data quality: Medium (basic subscription - Forexite)
Stop Loss: none
Take Profit: 30 pips (or any other FIXED value)
Projects:
Scripts:
Templates: SMA 100

Buy rules:

1. Open a buy order at any price if the price is above the moving average with the 0.01 lot size
2. Place buy limit 50 pips below and set the 0.02 lot size. Take profit should be placed at the entry of
the previous trade
3. Place buy limit 100 pips below the first trade and set the 0.04 lot size. All take profits should be
placed at the level of the previous trade
4. Place buy limit 150 pips below the first trade and set the 0.08 lot size. All take profits should be
placed at the level of the previous trade
 5. Place buy limit 200 pips below the first trade and set the 0.16 lot size. All take profits should be
placed at the level of the previous trade
6. Place buy limit 250 pips below the first trade and set the 0.32 lot size. All take profits should be
placed at the level of the previous trade
7. Place buy limit 300 pips below the first trade and set the 0.64 lot size. All take profits should be
placed at the level of the previous trade
8. Place buy limit 350 pips below the first trade and set the 1.28 lot size. All take profits should be
placed at the level of the previous trade

Sell rules
1. Open a sell order at any price if the price is below the moving average with the 0.01 lot size
2. Place sell limit 50 pips above and set the 0.02 lot size. Take profit should be placed at the entry of
the previous trade
3. Place sell limit 100 pips above the first trade and set the 0.04 lot size. All take profits should be
placed at the level of the previous trade
4. Place sell limit 150 pips above the first trade and set the 0.08 lot size. All take profits should be
placed at the level of the previous trade
5. Place sell limit 200 pips above the first trade and set the 0.16 lot size. All take profits should be
placed at the level of the previous trade
6. Place sell limit 250 pips above the first trade and set the 0.32 lot size. All take profits should be
placed at the level of the previous trade
7. Place sell limit 300 pips above the first trade and set the 0.64 lot size. All take profits should be
placed at the level of the previous trade
8. Place sell limit 350 pips above the first trade and set the 1.28 lot size. All take profits should be
placed at the level of the previous trade

As you see we double the lot on each trade and change the take profit every time the price reaches the
next buy limit. In case you lose on the trade you can still earn money.

Example. Let’s say you have 5 losing trades in a row and after that you place take profit at the level of
the 5th trade’s entry.

# of the trade Lot size Pips Result

1 0.1 -200 $-20
2 0.2 -150 $-30
3 0.4 -100 $-40
4 0.8 -50 $-20
5 1.6 0 $0
6 3.2 +50 $160
At the first trade you lose 200 pips*0.1 lot=$20. You lose on 4 first trades, the 5th one is closed with zero
loss, and the last trade is the only one that is profitable and it covers all the rest non-profitable trades.
So your profit will be at $50.
 Result Positive Negative
Description of It is not necessary to forecast where It can happen that you won’t have enough
the feature/ the market will move. You can enter money on your deposit if you struggle from
problem the trade at any point and still win multiple losses and that is why you will lose
everything.
Improvement/ Use Trend indicators to avoid 1. Have small lots or a huge deposit
Solution activating many trades 2. trade with the trend (use moving
averages)
3. increase the distance between the
trades (if you set 100 pips difference
between the trades in the previous
example then you will have: $-20 + $-
20 + $0 + $80 = $40)

There are a lot of people who criticize this strategy. Forex Tester’s team suggests you to test this strategy by
yourself using our backtesting program.

You can discuss this strategy on the Forex Factory’s forum. Make use of this link:
http://www.forexfactory.com/showthread.php?t=235889 and find out more details, meet experienced
traders and find plenty of strategies at any taste.

Price Action strategies

Price Action is a form of technical analysis that focuses on past prices that have traded in the market. No indicators are
used at all. The only thing which is necessary is the chart itself.

Using price action you need to pay attention to the candlesticks only. As you see from the picture
there are 4 levels in every candlestick: open, high, low and close prices. If the candlestick opens at
a lower price (for example, at 1.3000) and then closes higher (for example, at 1.3020) then we will
see a white candle (you can change the color scheme easily in your Forex Tester). The colors will
give you a visual comprehending of the strength of the buyers and the sellers. If it is white – buyers
(bulls) have won, if it is black – sellers (bears) have won.
Strategy #3. Simple short-term strategy
Currency pair: any
Timeframe: W1, D1, M15, M5
Indicators: none
Data type: 1-min
Data quality: Medium (basic subscription - Forexite)
Stop Loss: 10 pips
Take Profit: 10 pips
Projects: none
Scripts: none
Templates: SMA 100

Buy rules:
1. Draw a weekly open on a W1 chart with a pink line
2. Draw a monthly open on a Month1 chart with an orange line
3. Switch to D1 chart and see if yesterday’s close is above those lines
4. If it is above then you need to draw a daily high with a green line
5. Switch to M5 or M15 and set the buy stop order at 1 pip higher than the green line (Use Forex
Tester’s dropper for more convenient setting up the orders)
6. Set Stop Loss and Take Profit values at 10 pips each (Set the value in the dropdown menu and use
the arrow buttons)

Sell rules:
1. Draw a weekly open on a W1 chart with a pink line
2. Draw a monthly open on a Month1 chart with an orange line
3. Switch to D1 chart and see if yesterday’s close is below those lines
4. If it is below then you need to draw a daily low with a green line
5. Switch to M5 or M15 and set the buy stop order at 1 pip lower than the green line (Use Forex
Tester’s dropper for more convenient setting up the orders)
6. Set Stop Loss and Take Profit values at 10 pips each (Set the value in the dropdown menu and use
the arrow buttons)
Strategy #4. Engulfing bars
Engulfing pattern (Outside bar). If the candlestick fully covers the previous candlestick then the engulfing
pattern is formed. In many cases it is the signal that the previous trend is over.

1. Determine the trend

2. Find Engulfing pattern
3. Place the buy stop 30-50 pips higher than the engulfing pattern / Place the sell stop 30-50 pips
lower than the engulfing pattern
4. Stop Loss – should be placed at the ATR 5 value (find more about this indicator in the Strategy #7)

You can discuss this strategy on the Forex Factory’s forum. Use this link:
http://www.forexfactory.com/showthread.php?t=151592 and find out more details, meet experienced
traders and find plenty of strategies at any taste.
Strategy #5. GBP/USD simple breakout system
Currency pair: GBPUSD
Timeframe: H1
Indicators: none
Data type: Tick data:
Data quality: High-quality
http://www.forextester.com/HistoryServiceDescription
Stop Loss: Custom (we prefer to use 10 pips)
Take Profit: 5 pips
Projects: none
Scripts: none
Templates: none

Rules:
1. Find the high of the previous day and draw a red horizontal line
2. Find the low of the previous day and draw a green horizontal line
3. Set buy stop at the high of the previous day (red line)
4. Set sell stop at the low of the previous day (green line)
5. Set stop losses and take profits
6. When one of the pending orders is activated delete the other pending order that did not work.

You can discuss this strategy on the Forex Factory’s forum. Use this link:
http://www.forexfactory.com/showthread.php?t=29395 and find out more details, meet
experienced traders and find plenty of strategies at any taste.
Strategy #6. Simple “Make Pips” Strategy
Currency pair: any
Timeframe: H1
Indicators: none
Data type: Tick data
Data quality: High-quality
http://www.forextester.com/HistoryServiceDescription
Stop Loss: 10 pips
Take Profit: 5 pips

Buy rules:
1. Find 2 bullish bars (the close price of the bullish bar is higher than the open price of the same
bar)
2. Open the order at the close of the 2nd bar.

Sell rules:
1. Find 2 bearish bars (the close price of the bearish bar is lower than the open price of the
same bar)
2. Open the order at the close of the 2nd bar.

If you have 2 bars in a row at one direction then the probability that the price will keep going to that
direction is more than the probability of a reversal.
You can discuss this strategy on the Forex Factory’s forum. Use this link:
http://www.forexfactory.com/showthread.php?t=511908 and find out more details, meet
experienced traders and find plenty of strategies at any taste.

Please notice that price action strategies should be traded in the direction of the trend.
Strategy #7. The Trader vs. the Coin
Currency pair: any
Timeframe: D1
Indicators: ATR (Average True Range)
Data type: 1-min
Data quality: Medium (basic subscription - Forexite)
Stop Loss: 40% of ATR
Take Profit: None (close at the daily close price)
Projects:
Scripts:
Templates: ATR
1. At the end of the day take a look at what kind of the candlestick was formed. If it is a bullish one –
open a buy order; if it is a bearish bar – open a sell order. (Originally the decision of what kind of the
trade to choose was due to the coin: head – buy, tails – sell. And the result was still positive. But on
our opinion the probability to win is higher if you trade at the same direction of yesterday’s move –
short-term trend)
2. Look at the ATR indicator and see how much does it show.
3. Multiply the value of ATR indicator by 0.4 and set stop loss with this value.
For example, your ATR shows 0.01237. It means that during the last 2 weeks the average spread of
the candlesticks was 123.7 pips. When you multiply 123.7 by 0.4 you will get 50 pips – that is your
stop loss for the next day.
4. If the order was not closed by stop loss you will need to close it at the end of the day and
immediately open a new trade (see the first paragraph of this instruction).
There are 4 types of trades on the market:

Non-volatile days that are against you – Volatile days that are against you – you won’t lose
You lose but not too much much because of stop loss
Non-volatile days that are in your direction – you Volatile days that are in your direction – you will
earn a bit win a lot and this strategy is designed to search for
this type of the trades
Please pay attention that it is necessary to open the orders every day. If you do not use this rule then
you can miss the day with a big profit and that is why the entire strategy won’t make any sense.
Strategy #8. Accurate Trading Strategy
Currency pair: EURUSD, GBPUSD
Timeframe: H1
Indicators: Awesome Oscillator, Accelerator Oscillator,
Parabolic SAR, Exponential Moving Average
Data type: 1-min
Data quality: Medium (basic subscription - Forexite)
Stop Loss: High of the candle (for a sell order)
Low of the candle (for a buy order)
Take Profit: When you get the signal opposite to the entry
Projects: Not necessary
Scripts: Not necessary
Templates: AO AC SAR EMA

Buy rules:
Awesome Oscillator Turns Green
Accelerator Oscillator Turns Green
The Parabolic SAR is below the current Candle

Sell rules:
Awesome Oscillator Turns Red
Accelerator Oscillator Turns Red
The Parabolic SAR is above the current Candle
So we receive the signals from Accelerator, Awesome Oscillators and Parabolic SAR on the same candlestick
and that is why open at the next bar’s close at 1.2769 . Stop loss should be set at 1.2751 (in this case it is 18
pips). After that we keep holding the position and close it at 1.2790. The reason for that is simple: Awesome
and Accelerator Oscillators turn red and Parabolic SAR is very close to the price. If you belong to
conservative traders then you would better close your trade here and get 21 pips of profit in just 16 hours. If
you are a risky trader you might say that Parabolic SAR is not above the candlestick so it is not the case. Let’s
take a look what happened afterwards.

As you see the market went even higher but after that went down and gave all 3 signals for closing the trade
when the price was at 1.2762. If you keep waiting for all signals then in this trade you will lose 7 pips.

It is up to you what kind of testing style, the conservative or the aggressive one, you need to choose.

You can discuss this strategy on the Forex Factory’s forum. Use this link:
http://www.forexfactory.com/showthread.php?t=288245 and find out more details, meet
experienced traders and find plenty of strategies at any taste.

In this strategy please pay attention to get the signals from every oscillator. The typical mistake of the most
traders is that they are in a hurry all the time. It is better to skip the potentially good trade than to enter too
early and that is why close the trade with a loss.
Strategy #9. The Hedging Strategy
This hedging strategy requires that you trade three currency pairs and the same symbol should appear twice
in three pairs. For example, you take 3 symbols: GBP, USD, JPY. After that you mix them all and create 3
currency pairs: GBPUSD, GBPJPY and USDJPY. Now you have these 3 symbols involved twice in 3 currency
pairs.

EURCHF CHFJPY EURJPY

sell sell buy
buy buy sell
If you sell EURCHF pair that means that you sell EUR and buy CHF. That is why to balance and insure your
deposit you need to buy EUR and to sell CHF in other pairs. To do that it is required to buy EURJPY and to
sell CHFJPY.

Examples. Here are some examples of how to use this strategy for other currency pairs

SELL SELL BUY

BUY BUY SELL
USD/CHF CHF/JPY USD/JPY
EUR/GBP GBP/CHF EUR/CHF
EUR/USD USD/CHF EUR/CHF
EUR/GBP GBP/JPY EUR/JPY
EUR/GBP GBP/USD EUR/USD
EUR/USD USD/JPY EUR/JPY
GBP/USD USD/JPY GBP/JPY
GBP/CHF CHF/JPY GBP/JPY
GBP/USD USD/CHF GBP/CHF
You can discuss this strategy on the Forex Factory’s forum. Use this link:
http://www.forexfactory.com/showthread.php?t=279648 and find out more details, meet
experienced traders and find plenty of strategies at any taste.

In this strategy please pay attention to open orders for all 3 currency pairs. Otherwise the whole sense of
hedging will be lost.
Strategy #10. The Tsunami Method
 This strategy is based on money management only. The decision about what kind of trade to open is
taken absolutely randomly. Your trading with this strategy will be more efficient if you use trend
indicators (for example, Moving Averages) and that is why open you orders in the right direction.
For example, if your Moving Averages are directed down then open sell orders, if they are looking
up – buy orders.
So you place an order (without a competent analysis because it is not necessary). The most
important is to have a set stop loss and take profit. You can set any amount of SL & TP. The only
required thing is the ration between them - it should be huge. For example, you can set stop loss at
10 pips and take profit at 300 pips. In this particular case you can afford to have 30 losing trades in a
row and then win just once and you will not lose anything. Let’s see an example of a random
currency pair on a random data range that was easily and pretty quickly backtested in Forex Tester.
As you see on the screenshot we had 13 losing trades in a row and lost 13% of our deposit already.
But at the current moment we had guessed correctly and the price moved at our direction for 135
pips and we have a total profit at 1%. You can be wrong 13 times from 14 and still get income. Let’s
proceed because our goal at 300 pips is not achieved yet.
2 days later (the 2nd screenshot) our aim is fulfilled.
Using money management strategies you do not need to bother yourself with technical or
fundamental analysis. You need just to be persistent and stick to the rules.

Result Positive Negative

Description of It is not necessary to forecast where It might be very stressful to lose tens of times
the feature/ the market will move. You can enter in a row. This strategy fits the traders with a
problem the trade at any point and still win strong belief only
Improvement/ Use Trend indicators to avoid 1. Have small lots or a huge deposit
Solution activating many trades 2. Whenever you feel like this strategy
does not work back test it again in
Forex Tester to regain your belief into
this system
You can discuss this strategy on the Forex Factory’s forum. Use this link:
http://www.forexfactory.com/showthread.php?t= 514127 and find out more details, meet
experienced traders and find plenty of strategies at any taste.

In this strategy please pay attention to the drawdown and trend indicators.

Please share your thoughts.

We’ve tried to explain the strategies in the easiest way so even the traders with a zero experience could
understand them. In case if you have any questions you can visit the threads that are mentioned in this file.
You can email us to this address: support@forextester.com and leave your comments, critics and
improvement suggestions.