This 50 pips a day forex strategy showcases the advantage of compounding profits.
but, Let’s be honest here, If you are mopping up 50 pips a day in trading, then you are probably on the way to some fortune and, subsequently, a good trading career.
The question is how. How do you identify potential profit opportunities? When do you make your entry? How long do you stay? and so many other questions?
This article not only answers the questions but exposes more questions to which you may not have an answer.
Mind you, this strategy has been back-tested with real market data, so you best believe it is rock solid.
Let’s dive in!
Why Trade the 50 Pips A Day Forex Strategy
The 50 pips a day strategy explained below is very simple both in design and implementation.
For example, if you are a scalper and you seek to make money every day then you really should consider obeying the rules of the strategy.
While this is a roadmap for every trader on the road to a successful trading career, we all know how volatile and uncontrollable the market can be.
Oftentimes, the market goes completely south.
The good thing is that this strategy makes room for potential profit situations even when your stop-loss is hit or when you don’t make up to 50 pips per day in dollar value.
Forex is a game of probability and you can’t make a certain number of profits every day for a particular period of time.
For this reason, I added a tweak to make sure that you are always in profit anytime you trade this strategy.
Strategy Tweaks – 50 Pips a Day Forex Strategy
Market structure: Any volatile structure. Preferably trending
Strategy: Trend trading
Recommended lot size: 0.01
Backtest: 100% Backtested with live data
Currency Pair: All Major Currency Pairs
PDF Version: Available For Download
Timeframe: Daily Chart
Expert Advisor: Available on request – Build the expert advisor
50 pips a Day Forex Strategy Video ( You will get more info from the video)
There is a video uploaded on youtube.
If you are more of a visual learner and would like to get a visual representation of the strategy, then follow the thumbnail below.
It is clear, concise and straight to the point.
50 Pips A Strategy PDF Download
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Entry For the Trade
The fundamental rule of this 50 pips a day forex strategy is just to wait for the break of previous candles either high or low.
And this rule applies to both buy and sell situations.
That is the long and short of it.
It doesn’t require any in-depth tool use or indicator.
Just keen attention to detail and patience.
Wait for the break of the previous candle; high or low
For Sell: Low at the previous candle
For Buy: High at the previous candle.
This rule is pretty straightforward and simple. You don’t take an entry position unless there is a break out above the wick of the previous candle.
As we can see in the image, we respected the breakout before considering the trade. This is the one and only rule of the strategy.
It is simple as long as you are attentive and patient enough to obey the rule, you should add 50 pips or more.
How Long Should We Wait Exactly Before Placing An Entry?
Wait for the new candle to cross the wick of the old candle by 10 pips.
This is not a standard as you can wait for as much as 15 pips.
By so doing, you have given the new candle an opportunity to form well above to the old candle.
We do this because we are trying to hedge against reversals and all that.
This is another example of another area where the market didn’t obey the rules of the strategy.
The reason why we want to wait for 10 to 15 pips above the wick of the previous candle is to avoid making a bad trade entry in places the market might reverse.
Exit for the trade
The exit strategy is as EASY as the entry strategy.
For the exit, you should follow these two strategies.
In the first exit strategy,
You put your Stop loss below or after ( depending on your position) the wick of the previous candle using the ratio
But as for the take profit place it is 1:1, 1:2 & 1:3 depending on the size of your stop loss.
Looks like gibberish right? it’s not
First of all, that distance isn’t 60 pips.
it is just an assumption.
But it’s important I picked a figure in order to buttress how to insert your take profit.
Assuming that distance is really 60 pips, using the 1:2 take profit ratio, your take profit should be at 120 pips.
The same for a 1:3 take profit.
It should be at 180 pips above your market entry.
It all depends on the ratio you want to use.
The second Exit Strategy
This second exit strategy uses the principles of hedging + lot multiplier + profit in money.
This strategy centres mostly on hedging.
Surely after going through that article, you will get the fundamentals of what hedging is.
Relating that idea to this strategy, it simply means that when a trade is going against you, you simply trade in the direction of the market and increase your lot size.
For example, if you place a buy trade on a 0.01 lot size and the market starts dipping, simply place a counter trade in the new position of the market and increase your lot size x 2.
That way you make up for your loss.
Do this continuously until you achieve your desired profit in money.
A profit in money is your desired profit goal.
it could be $20 it could be $50.
Once you hedge your trade with the x 2 multiplier, make sure you place an achievable profit in money where the market will take you out at.
Conclusion- 50 Pips a Day Forex Strategy
This strategy is definitely guaranteed to help scalpers scale the tides of day trading.
Paying attention is always key to a successful trading strategy and this 50 pips a day forex strategy is not an exception to that.
Do enjoy and practice and reach out to us for any questions and collaborations.