5 min Keltner System For MT4
Table Of Contents:
- 5 min Keltner System For MT4
- Selecting the trading instrument
- 5 min Keltner System For MT4 - Long trade setup
- 5 min Keltner System For MT4 - Short trade setup
- Trade Management
- 5 min Keltner System For MT4 - Conclusion
Please note: This strategy was publicly published in the trading community and is free to use. We do NOT make an attempt to decide if this strategy is profitable or not, because we know that the major factors regarding trading results are the skills/experience of the trader who executes the strategy. Therefore, we are mainly explaining the components and rules of the strategy. If applicable, we are highlighting advantages, disadvantages and possible improvements of the strategy.
The 5 min Keltner System For MT4 is a very delicate trading system. The traders have to be very cautious while using the strategy as minor mistakes can result in a big loss. My Keltner channel and stochastic oscillator have been used as the prime indicator for this strategy. Those who are aware of the Keltner channel knows very well that it provides strong support and resistance to the users. The aqua color band act as the support and the red color band will restrict the bullish movement in the price. On the contrary, we will be using the famous stochastic indicator to identify the quality of the trade signals.
After installing the template, you will often get a pop-up notification to buy or sell the asset. Depending on the pop-up notification and ignoring the essential analytical steps is going to be a big mistake. Traders have to evaluate the support and resistance level along with the slope. Though the system is designed to take trades in the 5-minute chart, we can analyze data in the M15 chart also. Inexperienced traders can look for the trade setups in the 15-minute chart as it will provide more time to evaluate the quality of the signals. After getting skilled, you can take the trades in the 5-minute chart which requires fast decision-making ability.
Selecting the trading instrument
If you ask a novice trader about their favorite trading instrument, they won’t be able to give a proper answer. When you ask the same question to an experienced trader, they will come up few specific assets name. Being a new user of the 5 min Keltner Systemy, you have to cautiously select the trading instrument. We are not putting any limitations or telling you that you can’t take the trades in exotic or cross pairs. Rather we will enhance your skill by teaching you some advanced steps which will aid you to pick the right instrument.
5 min Keltner System requires fast action from the trader's end. So, we would suggest picking a trading instrument in which the volatility is not that intense. You can take trades in the major currency pairs and expect to make a decent profit without having many problems. And try not to take the trades in the asset which is most likely to change its trend. Taking trades at the top and bottom of a trend is very risky and requires advanced knowledge about the price action signal. Lastly, the dynamic spread in the instrument should be less than 2 pips. If it is more than that, you won’t be able to maintain a decent risk to reward ratio with great ease.
5 min Keltner System For MT4 - Long trade setup
Long trades are taken then the Keltner channel support level is tested. We need to find the bullish bounce at the aqua color support line when the channel is in the ascending slope. A bullish bounce is nothing but the test of a critical support line in which the candle closes at a higher price. Once you have a bullish rejection of the support level in the 5 minute or 15-minute chart, you have to get the data from the stochastic signal line. In the stochastic indicator, the red signal line should have a positive slope. If the signal line is below the 20 levels, still you can take the long trade with confidence.
The long trades need to be taken with a 7-10 pips stop. To determine the take profit level, you need to evaluate the distance between the low band and mid-band in the Keltner channel. If the distance is greater than 20 pips, you can set the TP to the mid-band. If not, you have to set the TP to the top band in my Keltner channel indicator. In short, you have to ensure the risk to reward ratio for the trade is better than 1:2. And you are good at finding the trending asset, you should be able to find a 1:3 risk to reward ratio trade setup without any difficulties.
5 min Keltner System For MT4 - Short trade setup
So far we have learned the simple use of the 5 min Keltner System. Now it’s time to enhance our skills and master some advanced techniques which will allow us to trade with more confidence. In fact, these advanced techniques will give us more control over the trade. Look for the bearish price action signal in the red line of the Keltner channel indicator. The slope of the Keltner channel must be negative otherwise you should consider the trade signal as a reversal setup. Once you have the bearish trade setup at the Keltner resistance line, you have to examine the signal line in the stochastic indicator. The red signal line must be falling sharply from the 80 levels (overbought zone) and this is a strong indication the bears are going to dominate.
The stop loss is set by using the high of the bearish PA signal. The take profit level is determined by evaluating the distance from top to low band. Once you have determined the take profit, analyze the lot size. The intermediate traders often ignore their basic risk tolerance level and trade with high risk. Though the system 5 min Keltner System has a very high win rate, you should not test your luck. Trade with such a lot size will cause zero impact on your emotional stability. Let’s learn a bit more about the risk management process.
Trade management skill is more important than learning about the essential steps to take the long and short trades. Since we are not going to complicate the 5 min Keltner System, we would suggest everyone trade with 1-2% risk in each trade. And those who are looking to deal with 2 running trades, need to ensure the overall risk exposure is not exceeding 3% of their account balance. The system is capable of providing an excellent risk to reward ratio. So, there is no point in taking high risk in the trades.
Overtrading is also another burning issue in the investment business. People often get addicted to this market and start taking random trades by ignoring some details of their strategy. But to make money by using the 5 min Keltner System, you must follow the exact mentioned steps. And if you intend to bring any change to the system, you must test the revised version of this strategy in the demo environment. But remember, you can’t exclude any steps to improve the system. If you include additional steps, examine the system in the practice account.
5 min Keltner System For MT4 - Conclusion
Becoming a professional trader in the Forex market is not an easy task. The 5 min Keltner System may provide you a great level of ease and boost your confidence level, but you can’t avoid the losses. Those who have tried to win have made their life miserable. Instead of looking for profit, you should be working hard to devise a plan which will help you to lose less in the trades. By keeping the losing trades small and securing big winners, you can become a top trader in the Forex market. However, it will take time and you have to devote yourself to this market.
Thousands of traders are leading their life based on the classic 5 min Keltner System. The steps mentioned in this guide is very straightforward, you will still find the difference in the action among the traders. As you get skilled, blend fundamental news with the technical analysis done by this system. This should provide a better overview of the market and enhance your skills to a great extent. And keep on reading about this profession as a strong knowledge base can significantly improve your decision-making ability in the most uncertain period of the market.
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