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Forex trading system "Scalping with Bollinger Band"
Learn to scalp using Bollinger Band, Stochastic and Price action
This strategy allows us to find the best price to buy when the price is low and sell when the price is high. As it is a scalping method, hence the currency pair EURUSD with the lowest spread is recommended. As with any other strategy, there is no holy grail so one has to be careful during strong trending market as this strategy tends to work better during range-bound market.
Details
Categories: Technical, Scalping, Price Action
Timeframes: 1 Minute
Currency pairs: ANY
Trading sessions: US Session (New York), European Session (London)
Indicators used
- Bollinger Band
Period=20
Deviation=1
Shift=0
Apply to=Close
- Stochastic
%K Period=5
%D Period=3
Slowing=3
MA method=Exponential
Price Field=Close/Close
Entry rules
Vice versa, we open a buy order when the low of the current candle is lower than the lower bollingerband and the pink fast stochastics line is lower than 20 and the close of the previous candle at least 5 pips below the current candle as shown in the following picture.We open a sell order when the high of the current candle is higher than the upper bollingerband, and the pink fast stochastics line is higher than 80 and the close of the previous candle at least 5 pips higher than the current candle.
Trade management
The closing of the trades are described in the following exit rules.
Exit rules
We close the sell order when the low of the candle is below the lower Bollinger band. Vice versa, we close the buy order when the high of the candle is above the upper Bollinger band as shown in the following picture.
Advantages
We are trading at a good price in which we buy when the price is low and sell when the price is high.
Disadvantages
This strategy may not work well when one is trading against a strongly trending market.
Metatrader 4 chart template files
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