Ultima Markets【 Trading School 】 High probability candlestick line for pounds, practical sharing...

stayforeign exchangeMarket, nakedKStructure is an excellent tool for observing market trading sentiment, with the double cross being a key focus, especially recently seen in the GBP/USD exchange rate where two consecutive cross shaped candles are usedKLines provide strong decision-making basis for traders.Ultima MarketsThis article will delve into the double cross star strategy, helping you understand its meaning, underlying logic, and how to apply it in the foreign exchange market.

Double cross star structure

The core of the double cross star strategy is the continuous appearance of two cross star candles. A cross shaped candle is a special candle pattern characterized by a very close opening and closing price, forming a very small or non-existent entity, accompanied by long shadows. The message conveyed by this pattern is that there is uncertainty between buyers and sellers in the market, making it impossible to determine the direction of price trends.

The Characteristics of Double Cross Stars

After the appearance of the double cross star structure, it may have multiple meanings, depending on its location. If this structure appears after a downward trend, it may indicate a potential bullish reversal, as thisImplying that the bearish momentum is weakening, while the bulls may soon dominate。

On the contrary, if the double cross strategy appears after an upward trend, it may indicate a potential bearish reversal, as thisThis means that bulls have lost their momentum, while bears may begin to dominate the market。

A cross star usually represents the possibility of a market reversal, while two cross stars amplify this characteristic. But whether it is a favorable trend or a reversal trend in the future,What is clear is that the subsequent market fluctuations will be significantly amplified。

Double Cross Star Strategy

The use of the double cross star strategy is actually very simple.

1When1Two consecutive cross shaped candles appear on the periodic chart for hours or moreKLine;

2Mark the high and low points of the first cross shaped candle, which will form your breakthrough boundary;

3Waiting for the third oneKThe line completely breaks above the boundary line/Below.

4After the breakthrough is completed, the market price will go long/Short and set stop loss below the breakout boundary/upper2-3One point, or you can also set the stop loss at the low point of the third candle/Above the high point2-3Points.

5Stop profit and look towards the top of the market trend/Top low or break even ratio2-3About times.

The Double Cross Star Structure of GBP/USD

Last Thursday and last Friday, two cross stars were finally collected, and last Friday's candles were collectedKThe line may not be as clear, but the same long shadow suggests the intense long and short competition last week.

(GBP/USD daily chart, sourceUltimaMarkets MT4）

The structure of the double cross star brought an end to the overall downward trend, with a rapid increase yesterdayKThe line also confirms the arrival of a short-term reversal.

According to the double cross star strategy, yesterday's daily closing price broke through the high point of the first cross star, and today's Asian session theoretically requires direct entry. Stop loss is placed below the breakout price level2-3Point around. Stop profit price looking forward high or3A price range that is double the profit and loss ratio.

summary

The double cross star structure appears less frequently, but if it does, it is a high probability of entry. Because of thisKThe line is the ultimate manifestation of market bullish and bearish sentiment, representing who ultimately holds the upper hand between trading parties in different cycles.

However, regardless of the trading strategy, good risk position control is a key prerequisite. Secondly, when encountering opportunities, please do not hesitate or hesitate. Otherwise, even if the strategy with a high winning rate encounters three days of fishing and two days of exposure, it may also cause you to lose confidence in the strategy in the only number of failures.

Disclaimers

The comments, news, research, analysis, pricing, and other information contained in this article can only be considered as general market information and are provided solely to assist readers in understanding the market situation and do not constitute investment advice.UltimaMarketsReasonable measures have been taken to ensure the accuracy of the data, but the accuracy of the data cannot be guaranteed and can be changed at any time without notice.UltimaMarketsWe will not be responsible for any losses or losses (including but not limited to any loss of profits) that may arise from the direct or indirect use or reliance on such information.