The daily high low trading strategy is based on a simple concept. If price breaks yesterday’s high or low, it will most likely continue in that direction of breakout.

If you are trading a breakout of a candlestick that is larger than many that came before it, you may actually be taking a trade but get caught in the mean reverting tendency of the market.

This trading strategy works as :

Place 2 pending stop orders (buy stop or sell stop) to catch whichever direction the breakout happens.

Timeframes :  Best on4hr charts and above.

Instrument : You can use this strategy Majors currency pairs.

Indicators : You need Yesterday High & Low Indicator or mark it.

Trade Management :

• Once yesterday’s daily candlestick closes, place two pending orders 2 pips away on both sides. One sell stop pending order to catch the breakout downward and one buy stop pending order to catch the breakout upwards.
• Place your stop loss at halfway distance of that closed daily candlestick.

Take Profit :

Average the last 3 days range and use it as your profit range.

For example, if 120 pips is the range (high-low)  of day 1st day candle, day two had 90 pips and day 3 had 150 pips, then the average of these three days would be 120 pips then you should set Take profit at 120 pips if it more than stop loss pips. If 120 pips is less than stop loss pips then place take profit same as stop loss pips.

Pros :

• You can set and relax. You just need to check the trade progressing once a day.
• Easy to use and understand, Good strategy for beginners.
• Stop you from over trading.

Cons :

• Large stop loss distances so use position sizing to minimize your risk.

• Sometimes the market will activate one pending order and then the price is going to opposite direction heading for your stop loss.