The Candle SnR Indicator For MT4
Table Of Contents:
- The Candle SnR Indicator For MT4
- Explanation of the Candle SnR Indicator For MT4
- Trade examples using the Candle SnR Indicator For MT4
The Candle SnR Indicator For MT4 is a great utensil for every trader but is especially useful for newer traders that are not as experienced yet. The indicator displays support and resistance levels that are, depending on the current timeframe, based on either the daily, the weekly or the monthly candle. These levels are often very strong and well respected by the market and thus can lead to a lot of good trading opportunities.
In this article I will first explain how this indicator works. Following that explanation, I will then show you some trade examples of a good trading strategy that is based on the Candle SnR Indicator For MT4.
Explanation of the Candle SnR Indicator For MT4
The Candle SnR Indicator For MT4 uses the previous daily, weekly or monthly candle to show you some strong support and resistance levels. Which timeframe is used for the calculation depends on the actual timeframe of your chart. For the 1hour and everything below the daily timeframe is the base timeframe that is used for the calculation. If you are using the 4hour chart, then the indicator uses the weekly candle for the S&R level calculation and finally if you switch to the daily chart, the calculation is based on the monthly candle.
For the rest of this article I will assume that we are on the 1hour timeframe, thus the calculation is based on the daily candle.
The bold line that you can see in each period displays the opening price of the previous day. Now there are also three dotted lines. The dotted line that is the lowest displays the low of the previous day, while the highest dotted line shows the highest price of the previous day. The final dotted line displays the closing price of the previous day.
As you can see in the picture above, all these lines are quite strong S&R levels and are often respected by the market.
Trade examples using the Candle SnR Indicator For MT4
In the above image you can see the strategy that I used in work. The strategy combines the Candle SnR Indicator For MT4 with the popular MACD indicator. This combination is very strong and creates a large edge for us. This edge can give us a lot of confidence in our trading as well as good results obviously.
The MACD indicator is mostly used to spot a developing divergence. A divergence is a very strong sign of an exhaustion of the present market move or trend and often leads to a trend reversal. A bullish divergence is generated when the price constructs a lower low but the MACD indicator is showing a lower low and vice versa a bearish divergence is formed if the price forms a higher high but the MACD is drawing a lower high.
With the knowledge we gained from the MACD indicator we can now look for entry chances with the Candle SnR Indicator For MT4. Meaning that we can be confident that our S&R levels will hold and act as a bouncing spot instead of being broken. This sounds too easy to you? Well that’s the power of these two indicators combined. As you can see in the screenshot above, the strategy didn’t produce any losing trades. However, there is no strategy with a 100% winning percentage, so always make sure to apply a correct risk management while trading.