Commonly, a trend following strategy uses trend indicators whereas in this case uses a leading indicator. The Commodity Channel Index (CCI) is a momentum indicator that indicates when prices are unusually high or low compared to average prices. Common key levels are +100 and -100. This strategy uses the CCI to indicate the main trend depending on the key levels. When CCI is above +100, the uptrend is strong. On the contrary, when CCI is bellow -100, the downtrend is strong.
Take a long position if CCI is above +100 in a daily time frame (strong uptrend) and the CCI rises above 0 in a time frame of 30 minutes. Close the position in case of CCI, in a daily time frame, falls bellow 0. Take a short position if CCI is bellow -100 in a daily time frame and the CCI falls bellow 0 in a time frame of 30 minutes. Close the position in case of CCI, in a daily time frame, rises above 0.
Stops and Money Management:
Keep following the trend. A Trailing Stop could help.
- Limit: 60 pips.
- Stop: 30 pips.