What is the 1 hour Forex Strategy?
The 1 hour Forex Trading Strategy is a technique of trading forex which is based on the 1 hour candlestick chart time frame. The most preferred 1 hour Forex Strategy is based on the Asian Session breakout.
This particular 1 hour Forex Strategy does not require any technical indicators but relies only on price action.
The Asian Forex Session Opens at 11:00 PM GMT and closes at 8:00 AM GMT.
You can use a Time Conversion Tool to see the exact time this session opens in your country.
Note: – Currencies perform best when the trading session of their country is open.
In this case, trading assets related to the Asian-Pacific region gives the best results.
These include currency pairs with the Japanese Yen, Australian Dollar, and others. A perfect example to trade is the USD/JPY currency pair.
This Strategy allows you to place only one trade a day and I think that saves you having to overtrade. It is also suitable for those traders who are so busy to only afford little time to trade.
Trading the 1 hour Forex Strategy in Olymp Trade.
Having introduced the Strategy, when to trade and what to trade, the next question is, how do you trade profitably?
How do you trade the 1 Hour Forex Strategy based on the Asian Session breakout in Olymp Trade?
That is exactly what we are about to establish.
Trade the 1 Hour Forex Strategy based on the Asian Session breakout in the following simple steps.
- Choose the Right Currency Pair.
- Set your Candlestick Chart Time Frame to 1 hour.
- Wait for the Asian Session to Open and the first-hour candlestick to close.
- Place Buy and Sell Stop Pending Orders.
- Adjust your Stop Loss.
- Adjust your Take Profit.
- Wait for a breakout to happen in either direction.
- Cancel the Pending Order not activated.
- Repeat the next day.
1. Choosing the Right Currency Pair.
We mentioned that this strategy is based on the Asian Forex Session and so it can only be wise to trade currency pairs related to the Asian-Pacific region.
We agreed that a perfect Currency pair to trade under this circumstance is the USD/JPY. Choose USD/JPY from the assets then proceed to the next step.
2. Setting your Candlestick Chart Time Frame to 1 hour.
This is a 1 hour Forex Strategy and so it is preferred that you trade it on a Candlestick Chart time frame of one hour. A one hour chart time frame filters out much market noise and makes analysis easier.
Not much analysis is needed here.
The only reason we are trading a one-hour time frame is that it is a 1 hour Forex Strategy that works best under such a time frame.
3. Waiting for the Asian Session to Open and first-hour candlestick to close.
The Asian Session opens at 11:00 PM GMT.
You, therefore, need to convert this time to see what time it is in your country. After that, wait for the candlestick of that first hour (11:00PM GMT or its equivalent depending on your country time) to close.
Everything we will do will be based on this first-hour candlestick.
The price can either move up or down with respect to this first-hour candlestick’s high and low. Therefore, the high and low of this first-hour candlestick will play a key role in determining the market entry points.
4. Placing buy and Sell Stop Pending Orders.
You want to place a Buy Stop Pending Order in case the price breaks out of the first-hour candlestick’s high and a Sell Stop Pending Order in case the price breaks out of its low.
Place your Buy Stop Pending Order 2 pips above the high of the first-hour candlestick.
Conversely, place your Sell Stop Pending Order 2 pips below the low of the first-hour candlestick.
Your pending orders should be 2 pips away from the high and low of the breakout candlestick to save you from fake outs. If the price moves to the extent of activating either of them, then it means business in moving towards such direction.
5. Adjusting your Stop Loss.
Adjust the Stop loss orders such that they lie on the opposite sides of the Pending order they correspond to.
6. Adjusting your Take Profit.
The risk to reward ratio is essential in adjusting your take profit and stop-loss orders.
Employ the ratio appropriately and take a profit of up to 20 pips. That way, you will have risked less to earn more.
7. Waiting for the Breakout to happen in either direction.
The time we are setting up the trade is during the second-hour candlestick.
The price is still moving and will break out of the limits of the first-hour candlestick and continue in that direction.
Either the high or low of that first-hour candlestick is a potential level for the breakout.
Breaking out of the high activates the Buy Stop Pending Order while breaking out of the low activates the Sell Stop Pending Order.
8. Canceling the Pending Order not Activated.
Only one of the pending orders you placed will be activated. Immediately one is activated cancel the other.
9. Repeating the next Day.
You can place only one trade a day. Repeat the above steps the next day for another profitable opportunity.
Note – If neither your Take Profit nor your Stop Loss order is activated during any specific trading day, wait until the day ends and exit the trade, whether on profit or loss.
You have all the details now. Apply the 1 hour Forex Trading Strategy and make money trading on Olymp Trade.
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