If you are a fan of forex scalping strategies and the Bollinger Bands indicator, we have an excellent trading strategy for you to check, and its name is Bollinger Bands 5 Minute Forex Scalping Strategy. As a result, one can get many winning trades in a short period during sideway market conditions.
You don’t need new indicators, as everything is already in your MT4 trading software. That strategy is suitable for a forex 5-minute timeframe, and when it comes to mt4 currency pairs, choose the most liquid ones like GBP/USD or EUR/USD and trade only during major forex market sessions like London or New York.
Trading Rules for the Bollinger Bands 5-Minute Forex Scalping Strategy
The first and most crucial factor is that the Bollinger Bands indicator must be flat or almost flat. You should see the chart price moving sideways and trading in the range. In such conditions, the upper indicator Bollinger Band is used as a chart selling level or taking profit(TP) from a buy entry trade made from the lower band. and the lower Bollinger Band indicator is used as buying level or taking profit(TP) from a sell entry trade made from the upper band. The middle line is only a 20 simple moving average(SMA), and you should use it for moving your stop loss (SL) to break even when the chart price breaks through it.
Remember that the rangebound forex market doesn’t last forever, and there is often a big chart breakout after some time of price going sideways. When it happens, the Bollinger Bands indicator widens a lot, and a big chart candle takes place.
Buy Entry Signals
Make sure that the chart Bollinger Bands are pretty flat. Please wait for the price to touch the lower B Band, and when it does so, open a buy entry order. Set Stop Loss to 10 pips below your entry. When the chart price breaks through the middle BB, you can partially close your good profits or move your SL to trade breakeven. Fully take profit(TP) when the price hits the upper BB.
Sell Entry Signals
Make sure that the chart Bollinger Bands are pretty flat. Please wait for the price to touch the upper B Band, and when it does so, open a sell entry order. Set Stop Loss to 10 pips above your entry. When the chart price breaks through the middle BB, you can partially close your good profits or move your Stop Loss to breakeven. Fully take profit(SL) when the price hits the lower BB.
How to set up the Bollinger Bands Forex indicator in MetaTrader (MT4)?
Installation Guide
The Bollinger Bands forex indicator comes by default with every MT4 installation. First, run your forex trading platform.
Now move to the left side of your MT4 platform terminal. In the Navigator, find the gauge name, right-click it, and select Attach to the chart.
Bottom Line
The simple Bollinger Bands 5-Minute Forex Scalping Strategy is worth adding to your trading collection. A good forex strategy will enhance your chance of success. Nonetheless, remember to have realistic expectations. Like any other forex technical analysis tool, it cannot provide accurate signals 100% of the time. Thus, this forex trading strategy provides false signals occasionally. Its performance will change significantly depending on forex market conditions.
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