Bollinger Bands Bounce Forex Scalping Strategy
This is a strategy that is based on volatility of the market. This system works on a 5 minute timeframe and is applicable to any timeframe.
Since this strategy is based on a volatility market, you will be looking at a volatile market. The lower and upper band must spike and must be apart. If it is too tight up to 50 pips, then there will be no trades.
The entry point is after the price has broken the red lines and RSI histogram turn to the right color.
There will be no trades if RSI histogram is red even if the price closes the green lines. It is very important that RSI needs to compliment with the other indicators.
Observe how many days you have a losing trade after the lower band spikes, by this, you can filter.
Set stop loss at 20 pips and take profit at 20 pips. It’s 1:1 ratio. You can only risk 2% for 2%.
Here is an example of the entries:
Id price goes down, spikes lower band and the lines are going down.
Wait for the price to close the downward sloping green lines and RSI histogram turnd green.
Forex Indicators needed:
- Bands (100, 2);
- 39SMA; 36SMA, 13SMA, 5SMA,
- RSI Color Zero Line.
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