I recently started testing a system that is very simple, but sticks closely to market fundamentals. In forward testing and visual back testing I have seen very good results. It is very simple, and uses bollinger bands and support and resistance provided by those bands to get early entries and exits.
Basically, heres how it works. When the Pair is in trend, either bull or bear, the middle line of the bollinger band will be point up or down accordingly. So in the trend market we will be using retracement back to the center line (ma) for entries. Entry is simple: Once price touches (or nearly touches) the center line, the next candle that breaks the high of that bar is our entry. We enter as soon as the candle breaks the high (or low on a short trade) of the previous bar. We take profiit once price closes back below or above the center Line.
For A range trade, the center line on the Bollinger bands will be flat. We Enter trades when price touches the top or bottom bollinger band and bounces back. Once price has broken the high or low of the previous bar we have a trade. We exit the trade once the other band is hit. I have attached some examples. If anyone has any idea for an EA, I think this could be SUPER profitable!
P.S. I have foudn that on the 15min charts you can use a 20 pip TP and a 15 pip Stop loss... If you enter at the right time, this is very profitable as well. If any EA is developed, it would be great to have the flexibility to set a permant stop and TP for every trade, and also, a stealth stop and TP would be great so the broker can't see the traders orders.
Please let me know if you have any questions, if you have any ideas to make this better or improve the strategy or if you are a programmer who can make a quality EA that works on mutliple pairs for this.
Basically, heres how it works. When the Pair is in trend, either bull or bear, the middle line of the bollinger band will be point up or down accordingly. So in the trend market we will be using retracement back to the center line (ma) for entries. Entry is simple: Once price touches (or nearly touches) the center line, the next candle that breaks the high of that bar is our entry. We enter as soon as the candle breaks the high (or low on a short trade) of the previous bar. We take profiit once price closes back below or above the center Line.
For A range trade, the center line on the Bollinger bands will be flat. We Enter trades when price touches the top or bottom bollinger band and bounces back. Once price has broken the high or low of the previous bar we have a trade. We exit the trade once the other band is hit. I have attached some examples. If anyone has any idea for an EA, I think this could be SUPER profitable!
P.S. I have foudn that on the 15min charts you can use a 20 pip TP and a 15 pip Stop loss... If you enter at the right time, this is very profitable as well. If any EA is developed, it would be great to have the flexibility to set a permant stop and TP for every trade, and also, a stealth stop and TP would be great so the broker can't see the traders orders.
Please let me know if you have any questions, if you have any ideas to make this better or improve the strategy or if you are a programmer who can make a quality EA that works on mutliple pairs for this.
Attached Images
I use Heiken ashi with Bolinger bands to identify trend reversal.