16# Bollinger Band scalp GBP/JPY Trading System
Three Bollinger Bands Scalping
Bollinger Bands Scalp is a strategy for short time frame .
The trading idea is to enter the position when the price action reaches extreme area of the Bollinger bands.
Setup Strategy
Pairs: GBP/JPY, EURUSD, USDCHF, CADCHF, EURGBP, AUDNZD.
Time Frames: 1M, 5M
Maximum Spread: 0.0002 (ECN Account)
Price Chart: Bar Chart or candles.
Indicators:
Bollinger Band (50) deviation 2 - Color: Red
Bollinger Band (50) deviation 3 - Color: Orange
Bollinger Band (50) deviation 2 - Color: Red
Trading rules
Sell
Enter a short position when the price crosses the upper red band, reaching at least halfway to the orange band (preferably reaching the yellow band, although not always the case). Anticipate a
retracement towards the center of the Bollinger Bands, aiming to profit from this retracement.
Buy:
Similar to selling, wait for the price to range between the lower red and yellow bands. Trade the retracement towards the center of the Bollinger Bands.
Profit Exit:
Take profit at 5 to 10 pips, or exit at the middle band.
Stop Loss:
Implement two types of stops - time-based and loss-based.
Time-Based Stop:
Estimate how long it should take for the market to move in the expected direction. If the planned time has elapsed, close the order to avoid waiting for potential losses.
Loss-Based Stop:
Given the tight time frames, set very tight stops. In some instances, a quick 3-minute trade may not allow for a conventional stop loss. Rely on your money management system to determine
appropriate stops.
Note: It is crucial to thoroughly test and validate any trading strategy in a simulated environment before applying it to live trading. Additionally, strict adherence to risk management
principles is recommended for successful and sustainable trading.
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Write a comment
Mgd_Elislam (Wednesday, 06 March 2013 14:00)
my friends give me a recommendation to this system
so, thank you
but could you please give us more explanation about SL "your stops will be given to you by your money management system." and what is your recommendation money management system