BBADX combined system trading

I've been trading a pretty simple, straight-forward system. This is nothing new or revolutionary, but it's been effective in the time I've been trading it. I use standard 20-period Bollinger Bands and look for a break of either outer band and then a re-entry. I combine this with a 14-period ADX to filter out the potentially hazardous trades, since this is a method that will fail badly under heavy trending conditions. I look for the ADX to be under 25. If it is higher than that, I won't take the trade.

I trade on the 4-hour charts and set my SL just above/below a S/R level that is in the 70-100 pip range. My profit target is the middle BB line. I've been thinking of re-evaluating my exit strategy, as there are sometimes pips that get left on the table by closing out at the middle line.

Here is an example of a trade I took recently on AUD/CHF:

Hi Nico,

Thanks for sharing your easy-to-implement trading setup. First time I have seen a trader who only makes entries via ADX when BELOW 25... makes sense, though as you are attempting to avoid those heavy trending conditions.

How long have you been trading this way? Profitable? Pairs traded?

Have you waited to take profits when price has CLOSED on the other side of the middle Bollinger SMA 20? How about adding a 2nd set of Bollinger Bands with a deviation setting of 1, and using that line as your Take Profit?

Let's make some pips!

I've only traded this on demo for about a month. Always been a trend trader, but I've been interested lately in trying to trade ranges as well. I look at 28 different pairs (all of them majors, I don't trade the exotics). I usually take profit when price touches the 20 MA. I have not thought about adding the 1 standard deviation, but that may be worth looking into. Thank you for the suggestion.

+40 pips on USD/CHF over the weekend

A coder could write a script or EA that would:
1. Once price was 15 pips away from the 20ema, Take Profit would move to the far BB (beyond the ema), and then
2. A Trailing Stop of say 15 or 20 or 25 pips (whatever the trader would choose) would be activated.

This idea is to manage a trade once entered but not to automatically enter a new trade - that is still a trader's decision.