CFD Trading 20 Pips Price Range Moving Average CFD Strategy

The 20 pips cfds price range moving average cfd strategy is used on the 1 Hour cfd chart and 15 minute cfd chart. On the 1 hour and 15 minutes chart timeframes we use the 100 and 200 simple moving average indicator.

Both the 1 Hour and 15 minute cfd chart timeframes will use the 100 and 200 SMA (Simple Moving Average Indicator) to determine the direction of the CFD market trend.

The 1 Hour cfd chart time-frame checks the long-term direction of the CFD trend, upward or downward trend, depending on the direction of the moving averages. All trades opened should be opened in this trend direction.

We then use the 15 min cfd chart to find the optimal point to enter cfds trades. CFD trades are opened only when the price is within 20 pips range of the 200 simple moving average, if price is not within this pip range trades are not opened.

CFD Uptrend - Bullish Market Trend

To generate buy bullish cfd signals using the 20 pips moving average CFD Trading strategy, we shall use the 1hour and 15 minute cfd chart time-frame.

On the 1 hour cfd chart time-frame the price on the chart should be above both the 100 and 200 simple moving average. We then move to use a lower cfd chart timeframe - the 15 minute chart timeframe to generate a trading signal.

On 15 minute cfd chart timeframe, when price reaches the 20 pips range above the 200 SMA, we open a buy cfd trade and place a stop loss 30 pips below the 200 SMA. Stop loss can be adjusted to the amount of Pips that are suitable for your risk but to avoid being stopped out by normal CFD trading volatility its best to use a reasonable stop loss level.

A buy cfd trade can also be opened when the price touches the 100 simple moving average, provided the cfd price is not very far from the 200 simple moving average. Normally the 100 SMA will be within the 20 pips range of the 200 SMA.

100 and 200 SMA CFD Buy Signal - 20 Pips Moving Average CFD Strategy

CFD Downtrend/Bearish Market

To generate sell (short cfd signals) using the 20 pips moving average CFD Trading strategy, we shall also use the 1 hour cfd chart timeframe and 15 minute cfd chart time-frame.

On the 1 hour cfd chart timeframe, the price should be below both the 100 and 200 SMA. We then move to the 15 minute cfd chart timeframe to generate a cfd Signal.

On 15 minute cfd chart, when price reaches the 20 pips range below the 200 SMA, we open a sell cfd trade and place a stop loss 30 pips above the 200 simple moving average.

100 & 200 Simple Moving Average CFD Sell CFD Signal - 20 Pips Price Range Moving Average Strategy

With this cfd strategy method cfds price will generally bounce of these support and resistance levels because many cfd traders watch these levels, and open similar trades at around the same point.

These support & resistance levels act as short term resistance or support levels within the price charts.

Profit Taking level For This CFD Strategy

With this cfd strategy the price will bounce and make a move in direction of the original CFD trend. This move will range from 60 - 70 pips.

The best cfd profit taking level would therefore be considered to be 60 to 70 pips from the 200 SMA.