This trading strategy has been developed by Bollinger Bands and Fractal indicator. These are basic mt4 trading indicators. In this trading system, you can get reversal signal by Bollinger Bands and confirmation from Fractal. It is easy to find trading set-up from this trading strategy. You can use this system for scalping purpose. Winning ratio of this trading system is impressive.
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(1) Bollinger Bands indicator.
(2) Fractal Indicator.
How to get buy signal
Buy signal will come from lower Bollinger Bands. This lower band indicates oversold condition of the market. So when market touches lower Bollinger Bands, then you need to wait for confirmation from fractals. When any rejection type candle or any bearish candle formed on that level and fractals appears below that candle, then you will get buy signal confirmation.
How to get Sell signal
Sell signal will come from higher Bollinger Bands. This higher bands is considered as overbought area of the market. When price touches higher Bollinger Bands, then you need to wait for sell confirmation from fractals. When any rejection pin bar type candle or any bearish candle formed on that overbought area, and fractals appear above the candle, then you will get sell signal confirmation..
Time frame: H1, H4, Daily. For scalping purpose you can this strategy on shorter time frame.
Currency pairs: All pairs.
Take profit and Stop loss: Take profit will depend on time frame. For scalping, you can set 20-30 pips take profit. For higher time frame, you can set 60-100 pips take profit. When market comes to middle band, then you can take half profit from your trade. You need to close your buy trade when price touches higher Bollinger Bands. Similarly, you need to close your sell entry when market price touches lower Bollinger Bands.
You have to set stop loss above fractals for sell entry. Similarly, you need to set stop loss below fractals like as above image.
Risk warning: This strategy is suitable for comparatively less volatile pairs. So you need to avoid this strategy on the news time. You should follow money management theory. You can take 1-2% risk for every trade for following this Bollinger Bands and Fractals strategy. After practice this trading strategy on demo account, you can use this on your live account.