Bollinger Band Breakout Forex Trading Strategy

TheĀ Bollinger Band Breakout Forex Trading Strategy is also a fairly simple trading system to understand and implement.

Timeframes: 1 hr or 4hr

Currency Pairs: any

Indicators: bollinger band with default settings.

 

TRADING RULES

Now, lets get straight to learning how to trade the bollinger band breakout.[sociallocker]Refer to the chart below for the trading rules that are further down the post.

Bollinger Band Breakout Forex Trading Strategy

 

Buy Setup:

  1. Make sure there’s an obvious resistance level that you can see on your chart.
  2. Wait until a candlestick breaks above the resistance and closes above the bollinger band line.
  3. Place a pending buy stop order 2-3 pips above the high of the candlestick to capture the the breakout if it happens.
  4. Place you stop loss 3-5 pips under the low of the breakout candlestick.
  5. Take profit options: you can use the previous swing high peak as your take profit level.

Sell Setup

  1. Make sure there’s an obvious support level that you can see on your chart.
  2. Wait until a candlestick breaks below the support and closes below the bollinger band line.
  3. Place a pending sell stop order 2-3 pips below the low of the candlestick to capture the the breakout if it happens.
  4. Place you stop loss 3-5 pips above the high of the breakout candlestick.
  5. Take profit options: you can use the previous swing low troughs as your take profit level.

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