Scalping with pattern 1-2-3- and Bollinger Bands Strategy For MT4

Scalping with pattern 1-2-3- and Bollinger Bands Strategy For MT4

The Scalping with pattern 1-2-3- and Bollinger Bands Strategy For MT4 is a rather unique trading strategy. It comprises the well known 1-2-3 reversal pattern that occurs at regular intervals in the market. On top of this, the scalping with the 123 pattern and Bollinger bands trading system combines the Bollinger bands as well.

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Thus, what you get is a rather technical but robust way of trading. When prices move to the lower end of the Bollinger bands, they could signal a bounce. When this happens in a downtrend, the occurrence of the 1-2-3 pattern could signal a reversal, or a retracement.

Similarly, when price is trading near the upper end of the Bollinger band, the occurrence of the 1-2-3 pattern signals a retracement to the downside. The trend might be up or down, but the 1-2-3 pattern clearly tells you that a reversal or a retracement is occurring.

Thus, applying these concepts, you get the scalping with the 123 pattern and Bollinger bands. This trading system uses just two indicators. The first is the Bollinger band indicator itself. The second is the 1-2-3 pattern alert system. What this indicator does is, it plots the 1-2-3 pattern when it forms.

For traders, a bit of filtering is required. We only trade the signals where you see the 1-2-3 pattern emerging near the lower or the upper Bollinger band. This is why the scalping with the 123 pattern and Bollinger bands is a scalping system and not suited for trading long term trends in the markets.

Overall, the scalping with the 123 pattern and Bollinger bands trading strategy is very simple to learn as you will see when we demonstrate how to take long and short positions in the market.

Scalping with 123 pattern and Bollinger bands – Long positions




Let’s first look at how to take a long position using the scalping with the 123 pattern and Bollinger bands scalping strategy. The first bit is of course in understanding how the trend is. In the above example, we have price trading near the lower Bollinger band. Note the previous slope of the Bollinger band. It tells you that the market is trending lower.

So when we have the 1-2-3 pattern occurring, it signals that a reversal is underway. When these conditions are met (trend, lower Bollinger band and 1-2-3 pattern), you can go long on the market. The 1-2-3 pattern indicator automatically plots the levels for you.

So set your pending long order at the 100% and set your targets to 161.8% and across upper levels as well. For setting up your stops, you can do this either at the low of the candlestick or near the 0% level of the 1-2-3 pattern.

Depending on how and where you set your stop loss, it will affect the reward side of the trade set up. Therefore, you need to be astute in knowing where to set up the stop loss levels. Unfortunately, the scalping with the 123 pattern and Bollinger bands trading system will not tell you where to set your stops or take profit levels. So a bit of practice, using this method is recommended. The above example shows you an emerging pattern.

Scalping with 123 pattern and Bollinger bands – Short positions




You can also trade the short side of the market using the scalping with the 123 pattern and Bollinger bands. In this set up, we begin first by assessing the general trend in the market. In the above example chart, we see that the previous trend has been up. Following this, we see that the market topped out and turned flat before starting to decline.

Notice how the 1-2-3 pattern is formed right here. This suggests that the markets are undergoing a correction or even a potential reversal of the trend. With the 1-2-3 pattern automatically plotting the price levels for you, you can set a pending short order near the 100% level.
Following this, set your stop loss near the 0% (which will widen your stop loss). So if the market conditions are right, you could set your stop loss closer to the signal bar. While this can increase the risk of your stops being hit, it will give you a favorable reward or take profit level.

To set your take profit level when using the scalping with the 123 pattern and Bollinger bands trading system, apply the take profit level to the 161.8% initially. If the trend is strong, you might see prices falling further and reaching the further out levels.

It is important that you manage your positions actively. Remember that the 1-2-3 pattern is not a sure pattern, meaning that price action can tend to reverse direction. Therefore, you need to be cautious until your trade hits the take profit level. A good money and risk management tactics will play an important role when trading with the scalping with the 123 pattern and Bollinger bands trading system.

Is the Scalping with pattern 1-2-3- and Bollinger Bands Strategy For MT4 good for trading?


The scalping with the 123 pattern and Bollinger bands trading is somewhat of an advanced trading strategy. So if you are totally new to forex trading, you should avoid using this trading strategy. It is also important to understand other concepts of trading such as divergence, overbought and oversold levels, retracements and Fibonacci levels.

Not to forget, knowing how Bollinger bands work can also work to your favor. The scalping with the 123 pattern and Bollinger bands trading system is ideally suited for scalping the markets. Therefore, apply this on intraday charts. At times, the scalping with the 123 pattern and Bollinger bands trading systems might also work on the 4-hour charts too. But regardless, we recommend that you first gain familiarity with the scalping with the 123 pattern and Bollinger bands trading system before you start to trade on a real account or even experiment with the settings.

Overall, the scalping with the 123 pattern and Bollinger bands trading system is worth giving a shot.

Download the complete system description and the files here:

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