Scalping Bollinger Bands Strategy is a scalping trading system to be used on 5 or 15 min timeframe.
Timeframe: 5 min or 15 min
Risk: MAX 1% of account equity per order
Bollinger Bands (20, 0, 2)
Stochastic Oscillator (5, 3, 3)
Moving Average (200 EMA)
Scalping Bollinger Bands Strategy Overview
In order to use Scalping Bollinger Bands Strategy you need to setup your charts including the Bollinger Bands (20, 0, 2), the Stochastic Oscillator (5, 3, 3) and the Moving Average (200 EMA).
Alternatively you can download the template below which looks like same as the screenshoot.
We will enter buy/sell positions based on Moving Average:
- If price is above Moving Average then we will enter ONLY BUY orders.
- If price is below Moving Average then we will enter ONLY SELL orders.
The Stochastic Oscillator needs to be above 80 for ONLY BUY orders and below 20 for ONLY SELL orders.
We will be entering on CANDLE close:
- If candle closes outside Bollinger Bands on the upper band we will enter BUY ORDER only.
- If candle closes outside Bollinger Bands on the lower band we will enter SELL ORDER only.
Scalping Bollinger Bands Strategy Entry rules
Candle closes ABOVE (BUY only) or BELOW (SELL only) Bollinger Bands indicator band
Stochastic Oscillator indicator needs to be in overbought (above 80) or oversold (below 20) position
PA must be above Moving Average for BUY only or Below Moving Average for SELL only
Once all three points are meet you can enter BUY or SELL position.
You should not risk more then 1% of your account equity per trade.
Once order is placed you should place your Stop Loss below last swing low / swing high or below opposite side of the Bollinger Band or below Moving Average.
The recommended Take Profit is as soon as you hit 10 pips or wait for the price to reach the middle of the Bollinger Band. Once price reaches 4 pips in positive make sure you set your BE (Brake Even) so that even if price reverses you will not lose money.
DO NOT trade in the 30 minutes before any major NEWS scheduled to come out.
If there is a brake in the Bollinger Bands BUT the Stochastic Oscillator is not in overbought / oversold position then you shall IGNORE all next signals until the price moves back to center of Bollinger Bands indicator.
DO NOT trade if the price crosses EMA and closes outside of Bollinger Bands indicator (you then need to wait until price gets back to center of Bollinger Bands indicator before placing another order).
DO NOT trade if the price closes outside of Bollinger Bands in opposite direction of trend
Scalping Bollinger Bands Strategy Exit rules:
Candle hits 10 PIPS in positive
Candle hits middle line of Bollinger Bands indicator
When you think that price will reverse and you are in profit better exit the trade then let it drop down you are Scalping after all