This strategy is excellent to scalp the forex market. This simple strategy consists of Bollinger Bands and MACD indicator.
The Bollinger Bands indicator consist of 3 bands or lines : Bollinger Upper Band, Bollinger Lower Band and Bollinger Middle Band.
The middle band is a 20 Simple Moving average. The Bollinger band upper and lower are the standard deviation of the middle band.
how to trade bollinger band and MACD scalping strategy
MetaTrader4 Indicator: Bollinger Bands (default setting),
Preferred Time Frames: 1 Minute and 5-Minutes
Recommended Trading Sessions: any
Currency Pairs: Majors only
Look for buy opportunities when the following chart or indicator pattern are in display:
1. Wait for the price to break and close above the upper outer band of the Bollinger Bands
2. If the MACD custom indicator histogram and line forms above the 0.00 level, it is a buy signal and you can immediately place a buy trade.
3. Place stop loss few pips (5-15) below the entry level
4. Exit your buy position if the MACD histogram drops into the 0.00 level.
The chart below shows an example of a buy setup on EUR/USD 5 minutes timeframe
1. Wait for the price to break and close below the lower outer band.
2. If the MACD histograms forms below the 0.00, it is a sell signal.
3. Place stop loss few pips (5-15 pips) above the upper outer band of the Bollinger Bands..
4. Exit your sell position if the MACD histogram move up into the 0.00 level.
the chart below shows an example of a sell setup on EUR/USD 5 minutes timeframe.
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