3 ducks trading system is one of the most popular trading systems among newbies. As newcomers often search for an effective and simple strategy, so they opt for this one.
Simplicity makes this strategy super popular. Once you figure out the core concept of this technical system, you also like this one. But to make the whole concept clear, I need to explain the strategy descriptively. Let’s start!
The whole concept of 3 ducks trading system
3 ducks trading system consists of 3 simple moving averages. all are 60 moving average. Firstly, you need to check whether the current price is above the 60 SMA or not in a 4-hour chart. Which is your first duck
Secondly, you have to go to the 1hr chart. if the price is above 60 sma in both 4 and 1-hour charts. This is the second duck.
Then comes in a lower time frame like in the 5 minutes chart. Yes ! of course, this one is the third duck.
Lastly, observe the 5-minute chart. When price breaks 60-period simple moving average in 5-min chart, then open a buy order.
Stop loss: place fixed 30 pips stop loss
Take profit: place fixed 30/40 pips profit target
Entry signal to sell/sell signal
Check whether the price is below the 60 SMA or not in a 4-hour chart.
Again check price is also below the 60 SMA or not in the 1-hour chart
If the price is below both in the 4 hours and 1-hour chart, then come in the 5-minute chart.
Open e short trade when price breaks 60 sma in 5 minutes chart.
Stop loss: place fixed 30 pips stop loss.
Take profit/exit signal: place fixed 30/40 pips profit target.
Currency Pair: trade only major pairs in this system
Amount of risk per trade: 2-3 %
Trend: probably many times you heard that trend is your friend. And for trading with the 3 ducks trading system, you need to make trends your friend. If there is no trend in the forex market, then this strategy could turn into a mess. If you come to trade in a choppy market, then you will blow your trading capital soon.
Don’t complicate 3 ducks trading system
Not only novices, but many professional traders also try to complicate any strategy by adding some extra tools. They tend to filter good trades from the bad ones. But by doing so, they often miss many great opportunities and sometimes intrigue the whole mechanism. if you wish to master any single
And a simple trading strategy, then just stick to the 3 ducks trading system. Don’t jump here and there finding some new one or adding something new with this one. In the long run, you will be benefitted.
Beware about fundamental news when applying 3 ducks trading system
Whether you are a technical analyst or fundamental analyst when applying this strategy, just take a look at the major fundamental news events like FOMC, NFP, etc.
As these events turmoil the market movements, so it’s better to stay away during these events.
Simplicity is best. No matter how small your capital is, if you adopt this simple but best strategy, then you could also get rid of the losing streak of forex trading. All you need to do is follow all the rules I stated above. There are many forex scams who claim that they are billionaire traders and try to sell their paid courses. But the truth is you will get too many resources and technical analysis like this completely free. So study these free materials and learn how to make pips within a short period of time. Happy trading!