Popgun Bar Pattern Forex Trading Strategy

The popgun bar pattern forex trading strategy is a trading strategy that executes buy/sell alerts based on the setup of an inside bar followed by an outside bar. This price action pattern is able to adopt the Williams’ Percent Range MT4 indicator and the Wilders DMI custom indicator.

Chart Setup

MetaTrader4 Indicators: Williams’ Percent Range.ex4 (default setting), WildersDMI.ex4 (default setting)

Preferred Time Frame(s): Any

Recommended Trading Sessions: Any

Currency Pairs: Any

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Buy Trade Example (Click the picture for full size)

popgun-bar-pattern-forex-trading-strategy

Fig. 1.0

Strategy

Long Entry Rules

Enter a buy in the market if the following chart or indicator patterns are in display:

  1. If a popgun bar pattern forms i.e. an inside bar forms followed by an outside bar that closes higher than it opens – enter a buy on the close of the outside bar.
  2. If the aqua line of the Williams Percent Range MT4 indicator breaks above the -50.0000 level, it is an indication that price is being pressured higher i.e. a bullish signal.
  3. If the light blue line of the Wilders DMI custom indicator is aligned above the orange line, while the lime vertical bars of the Wilders DMI custom indicator forms within the indicator window, a buy signal is advised.

Stop Loss for Buy Entry: Place stop loss below short term support.

Exit Strategy/Take Profit for Buy Entry

Exit or take profit if the following rules or conditions holds sway:

  1. If a reversal price action pattern forms (refer to our page for more on price action trading strategies), it is a signal that the current trend is losing steam, and hence it is wise to exit or take profit.
  2. Watch for a break below the -50.0000 level by the aqua colored line of the Williams Percent Range MT4 indicator.
  3. If the orange line of the Wilders DMI custom indicator is aligned above the light blue line while the vertical bars color turns tomato red, an exit or take profit is advised.

Sell Entry Rules

Place a sell order if the following chart or indicator pattern are in display:

  1. If a popgun bar pattern forms i.e. an inside bar forms followed by an outside bar that closes lower than it opens – enter a sell on the close of the outside bar.
  2. If the aqua line of the Williams Percent Range MT4 indicator breaks below the -50.0000 level, it is an indication that price is being pushed lower i.e. a bearish signal.
  3. If the light blue line of the Wilders DMI custom indicator is aligned above the orange line, while the vertical bars of the Wilders DMI custom indicator turns tomato red within the indicator window, a sell signal is advised.

Stop Loss for Sell Entry: Place stop loss above short term resistance.

Exit Strategy/Take Profit for Sell Entry

Exit or take profit if the following conditions or rules are visible on the activity chart:

  1. If a reversal price action pattern forms (refer to previous topics on this section on our website), exit or take profit accordingly.
  2. If the aqua line of the Williams Percent Range MT4 indicator breaks above the -50.0000 level, it is an indication that the trend is reversing in favor of the bulls.
  3. If the vertical bars of the Wilders DMI turns lime, it indicates that price is getting and bearish position(s) should be exited.

popgun-bar-pattern-forex-trading-system

Fig. 1.1

Free Download

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About The Trading Indicators

The Popgun bar pattern is one that is made up of an inside bar followed by an outside bar.

The Williams Percent Range MT4 indicator is a momentum indicator that gauges overbought and oversold levels, as seen in the stochastic oscillator.

The WildersDMI.ex4 is multipurpose intricate trend following indicator that is built on the ADX, DMI and ADXR. Lime bars denotes a bullish trend, while the tomato red bars are indicative of a bearish trend.

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