Why Bladerunner Reversal Is the Best EMA Cross over Strategy

Why Bladerunner Reversal Is the Best EMA Cross over Strategy

Submitted by adil on Mon, 03/24/2014 - 13:17

The Bladerunner Reversal is indeed the best EMA crossover strategy that traders use to generate more profits. The Bladerunner reversal is essentially a variation of Bladerunner itself. This makes use of Forex Polarity indicator that further consists of Bollinger mid-band and 20 EMA. Similarly, if you do not have access to Polarity indicator, you can use both of them together to trade Bladerunner reversal.

The Bladerunner reversal actually trades crossover of the two different indicators that are the basis of Forex Polarity indicator. The Polarity indicator does not actually show this cross. On the other hand, the Bladerunner indicates this cross in the shape of expanding and contracting yellow band.

In the case of Bladerunner reversal pattern, the price trades for sometimes with full strength after breaking out of a channel. Subsequently, the price halts, reverses in direction and moves through the Polarity indicator before it comes back and test the Polarity indicator from other direction once again.

The blue portion represents an Asian session in which price has failed at the daily central pivot (indicated by yellow line) early in the session and fell below a reasonably narrow band quite slowly. Subsequently, price fell constantly and touched blue dotted line (a weekly pivot) before it stopped declining and reversing from a grey dotted line (a round number).

Afterwards price created another indecisive band at the end of this session. At this point, a large financial surge occurred right to the round number from underneath of Polarity indicator. Price then moved towards the opposite end of Polarity indicator after it moved away from round number. This point potentially represents an EMA crossover strategy signal because Bollinger mid-band and 20 EMA might have crossed here.

The first of the two circles in the illustration represents first entry signal by indicating a bullish engulfing candlestick. The second circle represents a bullish engulfing candlestick pattern that is indicated by the white horizontal line and is closing over the current range and a quazi-morning star both of which indicate a further possible entry.

The Difference between Bladerunner and Bladerunner Reversal:

There is a major difference between these two widely used strategies. In the case of traditional Bladerunner strategy, the trade moves in the direction of the trend after bouncing from the Polarity indicator where Bladerunner waits for the confirmation of the trend first.

On the other hand, when the price reverses after the completion of the trend to close the price on other side of the Polarity indicator, the Bladerunner reversal comes into play. However, Bladerunner reversal also trades in the trend direction. The price closing on the right side of the trend actually determines this direction.

The above example is a bullish perspective of Bladerunner reversal strategy. The following graph indicates the totally opposite proposition that is the bullish perspective of the Bladerunner reversal from underneath of the Polarity indicator. Here, the price is repeatedly closing below the polarity indicator after its upward move has completed and it has further broken down. The underneath of the polarity indicators is then formed by a circled evening star pattern.

If the price has not trended for considerable amount of time, it is a good strategy to use both Bladerunner and Bladerunner reversal together in one session as an effective EMA scalping strategy.