Squeeze Arrow Bands Forex Trading Strategy

The Squeeze Arrow Bands forex trading strategy is a great tool for beginners who want to churn out profit in a low risk manner.

The strategy takes into account downside and upside risks in the market, while allowing traders make significant profits.

The blend of indicators is such that the Bollinger Bands gives us insight into price volatility as well as trend.

The Bollinger_Squeeze_v3 is a custom indicator that compliments the Bollinger Bands and to cap it all, the special buysellarrowscalper indicator gauges the start/end of a particular trend.

Chart Setup

MetaTrader4 Indicators: buysellarrowscalper.ex4 (Colors Width Modified; #0=2, #1=2), Bollinger Bands.ex4 (Parameters Modified; Period=28), Bollinger_Squeeze_v3.ex4 (Inputs Variable Modified; totalBars=3000, bolPr=12, bolDev=3.0, keltPrd=2.0, momPrd=24, alertBox=false)

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

Recommended Trading Sessions: Any

Currency Pairs: Any pair

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Buy Trade Example

Fig. 1.0

Strategy

Long Entry Rules

Initiate a buy entry if the following indicator or chart pattern gets put on display:

  1. If the buysellarrowscalper custom indicator forms a dodger blue upward pointing arrow on a lower spiked line as seen on Fig. 1.0, plus if the medium sea green middle line of the Bollinger Bands intersects the buysellarrowscalper line (refer to Fig. 1.0) bottom up, a buy trigger is said to be looming.
  2. If the histograms (lime green & light green) of the Bollinger_Squeeze_v3 custom indicator gets aligned above the 0.00 level as depicted on Fig. 1.0, a buy entry 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 takes precedence:

  1. If the buysellarrowscalper custom indicator forms a red downward pointing arrow that is placed somewhat above price bars or if the medium sea green middle line of the Bollinger Bands intersects the buysellarrowscalper line while a buy signal is ongoing, an exit or take profit is recommended.
  2. If a light pink or Indian red histogram is seen below the 0.00 level during a bullish trend, it is a trigger to exit or take profit at once.

Sell Entry Rules

Enter a sell order if the following holds true:

  1. If the buysellarrowscalper custom indicator forms a red downward pointing arrow on an upper spiked line as seen on Fig. 1.1, plus if the medium sea green middle line of the Bollinger Bands intersects the buysellarrowscalper line (refer to Fig. 1.0) top downward, a sell trigger is said to be on the horizon.
  2. If the histograms (light pink or Indian red) of the Bollinger_Squeeze_v3 custom indicator gets aligned below the 0.00 level as illustrated on Fig. 1.1, a sell entry is recommended.

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 takes center stage:

  1. If the buysellarrowscalper custom indicator forms a dodger blue upward pointing arrow that is placed slightly below the candlesticks or if the medium sea green middle line of the Bollinger Bands intersects the buysellarrowscalper line while a sell signal is running, an exit or take profit is advised.
  2. If a lime green or light green histogram is seen above the 0.00 level during a bearish trend, it is a trigger to exit or take profit without delay.

Sell Trade Example

Fig. 1.1

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About The Trading Indicators

The Buysellarrowscalper custom indicator is a trend following indicator that changes its color between a red downward pointing arrow (with upward spikes place on its red line) aligned above price bars to depict a bears market, and a dodger blue upward pointing arrow (with downward spikes place on its dodger blue line) aligned below price bars to trigger a buy market.

The Bollinger Bands consist of three bands with the outer bands being plotted as standard deviations away from the middle simple moving average band. The indicator offers good clues on the state of volatility in the market.

The Bollinger_Squeeze_v3 custom indicator uses histograms to measure price volatility.

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