Reversal with Stochastic, CCI and Keltner Channel strategy

By Paul | Published: January 24, 2008

This is a trading strategy to catch a turn in trend using Stochastic, Commodity Channel Index (CCI), and Keltner Channel. Here’s the concept.

Enter position on concurrent signals from the following indicators. CCI (which marks a turn), Stochastic (in corresponding overbought or oversold zone for confirmation), and Keltner channel (relative position of the current price) signals.

To avoid hunting for tops or bottoms in a strong move, do not enter if the current trend is obviously opposite of the entry position. That can probably be filtered by a 2-ema technique, MACD, or by analyzing a higher time frame.

Below are two example charts with all the indicators used illustrated along with the entry signals. Blue dots for long entry, red for short.

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