Volatility Hypertrend Scalping Strategy For MT4
Table Of Contents:
- Volatility Hypertrend Scalping Strategy For MT4
- The Volatility Hypertrend Scalping Strategy For MT4 – Long positions
- The Volatility Hypertrend Scalping Strategy For MT4 – Short positions
- Is the Volatility hyper trend scalping strategy good for trading forex?
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 Volatility Hypertrend Scalping Strategy For MT4 is a short term trading system that is based upon the trend and the volatility, as the title suggests. This is a very simple trading system and perhaps is ideally suited for both beginners and experienced traders as well.
The indicators used in the Volatility hyper trend scalping strategy are minimal and the trading signals and conditions are quite straight forward for anyone to understand and easily pick up trading with this method.
On the main price chart, we have two moving averages. These are the 5 period and 13 period smoothed moving averages. The two moving averages act normal to how a regular moving average based trading system would work.
Long or bullish markets are when the short term moving average rises above the long term moving average and short or bearish markets are when the short term moving average falls below the long term moving average.
Besides the moving averages, there are also blue and red arrows, pointing up and down respectively. These pointers are part of the indicator used in the sub window. This is the volatility hyper trend indicator. This is a custom indicator that is based upon the ATR period and the multiplier. Based on the values, which you can adjust, the Volatility hyper trend scalping strategy plots the two lines in the sub window.
Whenever these lines make a crossover, the red or blue arrows are pointed on the price chart. However, as you can see, these signals are not to be relied upon as there are many instances of a fake signal. Trading such signals could easily lead to losses.
An interesting thing to note is that the volatility hyper trend indicator can be a bit misleading. This is because, it shows the signals as and when the volatility rises and falls. The interesting part about volatility is the fact that it is not dependent on the trend or the direction. However, the volatility hyper trend indicator gives a signal as if the market is moving up or down.
You can see the reason now as to why you should not rely on the arrows shown on the price chart. They merely reflect the fact that the momentum is rising or falling. This same pattern can be seen when you look at the pace of which the price moves, and the signals generated from this oscillator.
It takes a while for the trader to get accustomed to this method of signals. Otherwise, trading blindly based on the direction of the arrows can be very misleading and prove fatal to your trading capital. These are the only indicators used in the Volatility hyper trend scalping strategy.
Let’s now take a look at how you can trade long and short positions using the Volatility hyper trend scalping strategy.
The Volatility Hypertrend Scalping Strategy For MT4 – Long positions
For long positions in the Volatility hyper trend scalping strategy, we first start by looking at the price action. We need to see price making a bottom and then starting to rise steadily. At this point, you will begin to notice that the moving averages also make a bullish crossover. This indicates that the market trend is shifting.
Another point to bear in mind is that you can look at the highs and the lows that are formed on the price chart. When you see that price action is consistently making higher highs, you can assume that the market is in an uptrend.
Following the above conditions, we then look to the hyper trend oscillator. Here, we need to see the momentum slowing, while at the same time, ensuring that price is trading above both the moving averages. Now, take a long position at market.
Use the previous low that you can see on the price chart and set this as your stop loss. Using one of horizontal lines on the price chart, you can use them as the take profit level. Note that you should only trade the positions where the risk to reward ratio is at least 1:3.
The Volatility Hypertrend Scalping Strategy For MT4 – Short positions
For short positions in the Volatility hyper trend scalping strategy, we first start by looking at the price action. We need to see price making a top and then starting to fall steadily. At this point, you will begin to notice that the moving averages also make a bearish crossover. This indicates that the market trend is shifting.
Another point to bear in mind is that you can look at the highs and the lows that are formed on the price chart. When you see that price action is consistently making lower highs, you can assume that the market is in a down trend.
Following the above conditions, we then look to the hyper trend oscillator. Here, we need to see the momentum picking up, while at the same time, ensuring that price is trading below both the moving averages. Now, take a short position at market.
Use the previous high that you can see on the price chart and set this as your stop loss. Using one of horizontal lines on the price chart, you can use them as the take profit level. Note that you should only trade the positions where the risk to reward ratio is at least 1:3.
Is the Volatility hyper trend scalping strategy good for trading forex?
To conclude, the Volatility hyper trend scalping strategy is a rather simple forex trading system. We particularly like this trading system for its simplicity and uniqueness. The Volatility hyper trend scalping strategy focuses on the volatility and the trend, which makes it a very good combination as far as a trading strategy goes.
The template is very light weight and therefore you can monitor multiple instruments at the same time. Since the hyper trend oscillator also has lots of settings for alerts of various kinds, you do not need to be stuck to your trading terminal.
Overall, the Volatility hyper trend scalping strategy is suited for traders at all levels.
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