Apr 14, 2025
Strategy
30-pips-a-day is a trading strategy used with volatile currency pairs like GBPJPY. This approach requires a wide space for trading maneuvers to obtain the required profit margin. Also, volatile currencies often provide clearer market reversal points. The timeframe used in this approach is 5 min.
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10-period exponential moving average
26-period exponential moving average
Below you can see how you can find the moving average indicator in the MetaTrader menu, and where to set the Exponential method for it.
The EMAs crossings are used to define the trend.
If the 10-EMA crosses the 26-EMA bottom-up and continues rising, it is a sign of an uptrend.
If the 10-EMA crosses the 26-EMA upside-down and continues falling, there is pressure down on the price.
You wait for the 10-EMA to cross the 26-EMA. That will give you the indication to prepare to open a position. Moreover, the way the 10-EMA crosses the 26-EMA defines the direction of trade opening, as will be explained in the scenarios below.
You wait for the price to follow the direction indicated by the EMAs to confirm your market interpretation.
You wait for a local correction against the observed trend. You will open a position at the high/low of this retrace. Your intention here will be to catch the range that the price will go through after getting out of the correction and following the observed trend again.
Examples are below.
On the M5 chart of GBPJPY, we observe a downtrend. In addition, we see that the 10-EMA has crossed the 26-EMA upside-down and continued going down. Therefore, we decide to sell on the falling trend.
However, we do not sell immediately. Instead, we wait until the price moves up in a correction to reach at least the middle point between the two EMAs. Now we place a sell order.
The stop-loss should be placed 15-20 pips above the sell order level. The take-profit is 30-40 pips.
The same logic is applied to the rising market.
On the M5 chart of GBPJPY, we observe an uptrend. Also, we see that the 10-EMA has crossed the 26-EMA bottom-up and continued rising. Therefore, we decide to buy on the rising trend.
However, we do not buy immediately. Instead, we wait until the price moves down in a correction to reach at least the middle point between the two EMAs. Now we place a buy order.
Note: in this scenario, the price not only moved down to the middle point between the EMAs but dropped even lower – that is also acceptable.
The idea here is to confirm that the retrace is significant enough to give maximum gain until the take-profit is activated.
The stop-loss should be placed 15-20 pips below the buy order level. The take-profit is 30-40 pips away.
As you can see, the take-profit and stop-loss levels are pretty far away from the position’s opening level. That is why the volatility of the currency has to reach these levels to make the strategy work. On the other hand, this approach may be considered relatively risky for the same reason. The stop-loss (15-20 pips) to take-profit (30-40 pips) ratio is 1 to 2. Traders need to weigh this against the available equity and risk-management in use.
In conclusion, 30-pips-a-day is an interesting and aggressive strategy to make a good profit on each trade. It is easily used but requires solid nerves. Cross-checked with standard trend analysis, it may be a good tool in the trader’s arsenal.