Lucky Reversal MT4 Forex Indicator Free Download Lucky Reversal MT4 Forex Indicator Free Download

Trend reversals in the Forex market can happen at any time. As long as there is a market trend, there will always be chart reversals. Many trend and trend reversal forex trading tools and strategies rely on this concept. Now it’s just a matter of how Forex traders use the right tools to catch reversals and trade trends. The Lucky Reversal Forex indicator is one of the many reversal trading indicators. But it has some characteristics that make it different from other Forex market trend reversal indicators.

What is Lucky Reversal Forex Indicator

The Lucky Reversal indicator does exactly what its name suggests: it tells when a trend changes from an uptrend to a downtrend, or from a downtrend to an uptrend. It is signaled with blue and red arrows followed by wavy horizontal lines. Blue arrows mark the start of an uptrend, while red arrows indicate a market reversal into a downtrend.

Another feature of the Lucky Reversal indicator is certainly more obvious at first glance. This feature is the white square that appears when the indicator indicates a temporary or potential reversal.

The main drawbacks of the Lucky Indicator

The Lucky Reversal indicator is different from many trend reversal indicators. First, it is a lagging indicator, making it difficult for traders to use it to trade reversal breakouts.

Many traders get frustrated using this indicator to catch the beginning of a reversal, and you can't blame them for trying. However, if you backtest this indicator, you will find that bullish and bearish signals are located right at the lowest or highest pivot points of major trend reversals. See the example in the image below. You will notice that as soon as the arrow appears, the price seems to reverse.

However, when testing this indicator on a live market, you will find that bullish or bearish signals only appear after the market completes a reversal. Furthermore, the reversal arrow will appear on the chart only when the reversal is confirmed. This indicates a lag in the Lucky Reversal indicator.

Main advantages of Lucky Indicator

The main weakness of the Lucky Indicator is its strength. Because it lags, you have a hard time catching reversals with it, but you can use it to confirm trades in emerging trends. For example, you can trade an uptrend that occurs after the market reverses from a downtrend to an uptrend.

Lucky Reversal Indicator Trading Strategy

The best way to trade with the Lucky Reversal Indicator is to include it in a trading system that can be integrated with other trading tools. For example, other trading tools in the strategy can be indicators or market structures (support and resistance, candlestick patterns, chart patterns, etc.).

To help you understand how to combine the Luck indicator with other indicators, we will use this indicator with the Moving Average indicator to form a first trading strategy.

Combine this indicator with the Moving Average indicator

Pull up the luck indicator and the two moving averages on the chart. Leave one moving average unchanged, but change the period of the other moving average to 20. Please change the color to distinguish it from the other moving average. The default moving average will be our fast moving average, and the 20 moving average is our slow moving average.

Next, wait for the lucky indicator to give you a buy or sell signal. Keep in mind that this indicator is lagging, so you are not intended to trade based on the indicator's buy or sell signals. Instead, we want to trade entry opportunities based on trends confirmed by the Lucky Reversal indicator. That's why we have these two moving averages.

When our Trend Reversal indicator signals an uptrend, you only buy when the fast moving average crosses above the slow moving average. Only sell when the Lucky Reversal indicator changes from a blue arrow to a red arrow. When our reversal indicator gives a downtrend signal, you will only sell when the fast moving average indicator crosses the slow moving indicator downward.

This is how you combine the Lucky Reversal indicator with other indicators. You don't have to use the moving average periods we use here for your strategy. You don't even have to use a moving average. All you need to do is find a trend trading indicator and combine it with a trend reversal indicator, just like we did.

There is another way to trade lucky indicator signals. This brings us to our second trading strategy.

1. Trading Lucky Reversal Indicator Signals

Lucky indicators usually show white squares where reversals are likely to occur. From this point on, the price continues to move, but the white square remains in its position. When a trend reversal is confirmed, the white square will turn into an uptrend or downtrend signal. At the end of the candle, the white square turns into a buy or sell signal to make the appropriate trade.

For example, place a buy trade when the lucky indicator confirms an uptrend, and place a sell trade when the lucky indicator confirms a downtrend.

Trade Management

For every trading strategy, setting a price target is the best way to set a take profit. Do not wait for any indicator to signal the opposite before exiting a trade.

When you want to set a stop loss, don't forget not to risk more than you can afford. The rule of thumb is, don't risk more than 2% in trading. With this in mind, you can use any method you are familiar with to set your stop loss.

The good thing about the Lucky Indicator is that once it draws a wavy line, the price rarely crosses over to the other side. Therefore, you can use it to set a stop loss, but it may sometimes only give you a satisfactory risk-reward ratio.

Who is the Lucky Reversal Indicator best suited for?

The Lucky Reversal Indicator is best suited for intermediate and professional Forex traders.

New Forex traders who understand the lagging indicator and how to trade it can also use this indicator with caution. In order to get the most out of this indicator, they may first need to know how to identify forex trend reversals.

Furthermore, the trend reversal indicator is best suited for trend and trend reversal traders.

Lucky Reversal MT4 Forex Indicator Free Download