Stochastic With Bollinger And LWMA Forex Scalping Strategy For MT4
The Stochastic With Bollinger And LWMA Forex Scalping Strategy For MT4 is designed for your five-minute trading charts and it can be used to trade any currency pair. The currency pairs may be broken into two groups – volatile and major currency pairs. The volatile pairs are EURJPY, GBPCHF, and GBPJPY. They are slightly more volatile than the major currency pairs.
There are two linear weighted moving averages – they have periods of 40 and 8. Then we use two stochastic oscillators and they have period settings of 5 and 18. Then we have a Bollinger bands indicator that needs to be configured to a period of 20 and a deviation setting of just 2. There is a pivot point level indicator included in this system. Its purpose is to give you guidelines on when to exit the market. They provide good levels for setting your take profit given the fact that the market respects these trading levels.
Long trades can be made when the 8-period and 18-period stochastic oscillators are both above the 50 level. Secondly, you need to check that the 2 LWMA is above the middle line of the Bollinger bands indicator and also above the 40-period LWMA. Stay out of the market if the stochastic is oscillating in an oversold region. You can re-enter the market upon a downward retracement towards the 50-level.
Set your SL about 10 to 12 pips below your entry. Short trades can be made when the 8-period and 18-period stochastic oscillators are both below the 50 level. Secondly, you need to check that the 2 LWMA is below the middle line of the Bollinger bands indicator and also below the 40-period LWMA. Stay out of the market if the stochastic is oscillating in an overbought region. You can re-enter the market upon an upward retracement towards the 50-level.
Set your SL about 10 to 12 pips above your entry. Depending on which currency pair group you are trading – your take profit will be six to 15 pips. The volatile pairs have the highest pip-potential but just bear in mind that you will incur more risk if you solely trade these volatile pairs.
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