This is almost a holy grail trading system. I have tested this strategy for some time now and I found this strategy can give you at least 80% accuracy. Let me introduce my Crude Oil scalping system with Parabolic SAR indicator for at least 20 points profits per day.
What is a scalping trading system?
A scalping trading system involves quickly entering trades and quich booking of profits. Its mainly an intraday trading system where you keep small target and small stop loss.
Who is a good broker for Crude oil scalping?
You need to choose a suitable broker. As this strategy involves small target and small stop loss and you need to trade multiple times a day for quick gains the brokerage should be very competitive. I shall suggest you to open a trading account with Zerodha as their brokerage is most competitive. Check this tool: Zerodha Brokerage Calculator.
The trading setup:
Open a 5 minutes chart of MCX crude oil and attach Parabolic SAR indicator OR PSAR (0.02, 0.2).
This will create crude oil ctart with PSAR. This is our basic setup for Crude Oil scalping.
1) Parabolic SAR indicator should be below price candle.
2) Wait for a candle whose open and low are same. This will be our entry candle.
3) Note the high of that entry candle.
4) Put a limit buy order in the terminal above the high of the entry candle.
5) Once the order is filled keep a stop loss below low of the entry candle.
6) Keep a target same as stop loss points OR 5 points whichever is greater, i.e if the stop loss is 3 points keep a target of 5 points but if the stop loss is 8 points then keep a target of 8 points.
7) Cancel the order if entry candle low get broken before triggering the buy.
Short sell condition:
1) Parabolic SAR indicator should be above price candle.
2) Wait for a candle whose open and high are same. This will be our entry candle.
3) Note the low of that entry candle.
4) Put a limit short sell order in the terminal below the low of the entry candle.
5) Once the order is filled keep a stop loss above high of the entry candle.
6) Keep a target same as stop loss points OR 5 points whichever is greater.
7) Cancel the order if entry candle high get broken before triggering the short sell.
This strategy works great for Crude Oil scalping and you can get 4-5 trades a day which can fetch you 20-30 points every day. Your observations will be welcome in the comment box below.
Indrajit is a professional blogger and trading system developer. Amibroker expert, WordPress expert, SEO expert and stock market analyst.Trading since 2002, he has started the journey of StockManiacs.net on 2008. He follows Indian and world stock markets closely.
Categories: Trading Strategy