Quantile Bands Forex Trading Strategy

The Quantile Bands forex trading strategy integrates the popular Traders Dynamic Index (TDI) indicator in delivering buy and sell trading signals that can be traded on a number of timeframes.

Chart Setup

MetaTrader4 Indicators: Quantile_bands_1.3.ex4 (default setting), TDI.ex4 (default setting)

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

Recommended Trading Sessions: Any

Currency Pairs: All pairs

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Buy Trade Example

Fig. 1.0

Strategy

Long Entry Rules

Enter a buy if the following conditions or rules hold sway:

  1. If the middle line of the Quantile_bands_1.3.ex4 custom indicator turns lime, price is said to be pressured to the upside i.e. a bullish signal.
  2. If the red line of the Traders Dynamic Index (TDI) custom indicators breaks above the 0.00 signal line as shown on Fig. 1.0, price is said to be witnessing some bullish sentiment, thereby supporting an overall buy for the instrument of interest.

Stop Loss for Buy Entry: Place protective stop loss 3 pips below short-term support.

Exit Strategy/Take Profit for Buy Entry

Exit or take profit if the following indicator or chart patterns are in display:

  1. If the middle line of the Quantile_bands_1.3 custom indicator turns silver, price is said to be range bound and as such an exit or take profit is appropriate.
  2. If the red line of the Traders Dynamic Index (TDI) custom indicators breaks below the 0.00 signal line as shown on Fig. 1.0, price is said to be reversing from its bullish trend i.e. an exit or take profit is advised.

Sell Entry Rules

Initiate a sell position if the following conditions or rules hold sway:

  1. If the middle line of the Quantile_bands_1.3 custom indicator turns sandy brown as seen below on Fig. 1.1, price is said to be pressured lower i.e. a sell signal.
  2. If the red line of the Traders Dynamic Index (TDI) custom indicators breaks below the 0.00 signal line as shown on Fig. 1.1, price in this case is said to be pressured lower i.e. a bearish signal for the pair of interest.

Stop Loss for Sell Entry: Place protective stop loss 3 pips above short-term resistance.

Exit Strategy/Take Profit for Sell Entry

Exit or take profit on position(s) if the following are true:

  1. If the middle line of the Quantile_bands_1.3 custom indicator turns silver, price is said to be range bound and an exit or take profit is most appropriate.
  2. If the red line of the Traders Dynamic Index (TDI) custom indicators breaks above the 0.00 signal line as shown on Fig. 1.1, price is said to be making a U-turn from its earlier trend. An exit or take profit will suffice at this point.

Sell Trade Example

Fig. 1.1

Free Download

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About The Trading Indicators

The Traders Dynamic Index (TDI) I a custom indicator that integrates the RSI (Relative Strength Index), its moving averages, and volatility bands (based on Bollinger Bands) to deliver to traders a complete representation of the current situation in the FX market.

The Quantile_bands_1.3 is a custom indicator that was designed to resemble the Bollinger Band, here its middle line is a combination of the two outer quantiles.

If the bot outer quantiles are depicting the same trend i.e. color, those of the middle quantile is same as those of the other quantiles, else it is undetermined i.e. silver if you deploy the default settings.

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