5 Bar Reversal Forex Trading System

The 5 Bar Reversal Forex trading system is a proven trend reversal FX system that works for any currency pair.

The system does well at looking at the complex currency market behaviors and then putting it all together in a simplified trading model.

The 5 Bar Reversal Forex trading system offers an impressive and simple system that scans the market for high probability trade setups.

The beauty of using this 5 Bar System is that trade setups appear on all timeframes.

Chart Setup

MetaTrader4 Indicators: 5-bar-reversal.ex4 (Default Setting), bollinger-queeze-with-macd.ex4 (Default Setting)

Preferred Time Frame(s): 1-Minute, 5-Minute, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours, 1-Day, 1-Week

Recommended Trading Sessions: Any

Currency Pairs: Any pair

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Buy Trade Example

Fig. 1.0

Strategy

Long Entry Rules

Enter a bullish trade if the following indicator or chart pattern gets put on display:

  1. If the yellow upward pointing arrow(s) of the 5-bar-reversal Metatrader 4 forex indicator gets positioned slightly below the price bars as depicted on Fig. 1.0, price is said to be driven higher i.e. a trigger to buy the designated currency pair.
  2. If the lime and blue histograms of the bollinger-queeze-with-macd indicator stack up above the 0.00 level as illustrated on Fig. 1.0, more bulls are said to be taking up positions, hence a signal to go long on the selected forex pair.

Stop Loss for Buy Entry: Place stop loss 2-3 pips below support.

Exit Strategy/Take Profit for Buy Entry

Exit or take profit from all trades if the following rules or conditions takes precedence:

  1. If the red downward pointing arrow of the 5-bar-reversal indicator pops up while a bullish trend is ongoing, bullish price pressures is said to be taking a hit, as such an exit or take profit is advised.
  2. If the bollinger-queeze-with-macd indicator pops up a red/blue histogram that gets aligned below the 0.00 reference level (see Fig. 1.0), the overall bullish market sentiment is said to be weaning, as such an exit or take profit will suffice.

Sell Entry Rules

Go short if the following setups gets displayed successfully on the activity chart:

  1. If the red downward pointing arrow(s) of the 5-bar-reversal Metatrader 4 forex indicator gets aligned fairly above the price bars as illustrated on Fig. 1.1, price is said to be pushed lower i.e. a trigger to sell the currency pair of focus.
  2. If the red and blue histograms of the bollinger-queeze-with-macd indicator stay below the 0.00 reference level as exemplified on Fig. 1.1, more bears are said to be taking up orders, hence a signal to go short on the selected forex pair.

Stop Loss for Sell Entry: Place stop loss 2-3 pips above resistance.

Exit Strategy/Take Profit for Sell Entry

Exit or take profit if the following takes center stage:

  1. If the yellow upward pointing arrow of the 5-bar-reversal indicator pops up during a bearish trend, bearish price pressures is said to be losing steam, as such an exit or take profit is recommended.
  2. If the bollinger-queeze-with-macd indicator pops up a lime/blue histogram that gets aligned above the 0.00 reference level (refer to Fig. 1.1), the overall bearish market sentiment is said to be halting, as such an exit or take profit will do.

Sell Trade Example

Fig. 1.1

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About The Trading Indicators

The 5-bar-reversal.ex4 indicator is a technical tool that measures 5 bullish bars in a row or 5 bearish bars in a row, in order to pinpoint reversals.

The bollinger-queeze-with-macd.ex4 custom indicator uses MACD, stochastic, CCI and RSI to gauge price volatility, as well as trends.

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