Bollinger Woodies Channels Forex Trading Strategy

To be able to avoid being punished by the market, you need to approach it with the right arsenal, one very crucial one is having a trading strategy that speaks for itself.

By speaking for itself, I’ll imply that a trader must have the composure needed to not interrupt trades based on emotions i.e. adhere to the predefined trading rules.

The Bollinger Woodies Channels forex trading strategy will do just fine for just about anyone if the rules are followed.

Chart Setup

MetaTrader4 Indicators: Bollinger Bands.ex4 (Parameters Modified; Period=28), DonchianChannels (Inputs Variable Modified; BarsToCount=10), DoubleCCI_Woodies.ex4 (Inputs Variable Modified; TrendCCI_Period=28)

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

Download

Download the Bollinger Woodies Channels Forex Trading Strategy

Buy Trade Example

Fig. 1.0

Strategy

Long Entry Rules

Enter a buy order if the following indicator or chart pattern gets put on display:

  1. If the medium sea green middle line of the Bollinger Bands MT4 indicator intersects the blue line of the DonchianChannels custom indicator in a bottom up manner as seen on Fig. 1.0, it is a trigger to go long on the designated currency pair.
  2. If the blue line and histograms (black, green & gold) of the DoubleCCI_Woodies custom indicator break and stay above the 0.00 signal level, it is a trigger to buy the selected currency pair.

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 center stage:

  1. If price closes below the medium sea green middle line of the Bollinger Bands MT4 indicator (refer to Fig. 1.0), an exit or take profit is strongly advised.
  2. If the blue line of the DoubleCCI_Woodies custom indicator dips below the 0.00 level while a buy signal is running, a bearish reversal is said to be looming, hence an exit or take profit will suffice.

Sell Entry Rules

Enter a sell order if the following holds true:

  1. If the medium sea green middle line of the Bollinger Bands MT4 indicator intersects the blue line of the DonchianChannels custom indicator in a top downward fashion as depicted on Fig. 1.1, a sell trigger is aid to be looming.
  2. If the blue line and histograms (black, red & gold) of the DoubleCCI_Woodies custom indicator break and stay below the 0.00 signal level, it is an alert to go short on the stipulated fx pair.

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 price closes above the medium sea green middle line of the Bollinger Bands MT4 indicator (refer to Fig. 1.1), an exit or take profit is strongly recommended.
  2. If the blue line of the DoubleCCI_Woodies custom indicator surges above the 0.00 level during a sell signal, a bullish reversal is said to be imminent, as such an exit or take profit will do.

Sell Trade Example

Fig. 1.1

Free Download

Download the Bollinger Woodies Channels Forex Trading Strategy

About The Trading Indicators

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 DonchianChannels is a technical study that was created by Richard Donchian and has the core aim of measuring volatility in the market.

The bands tend to expand with increased volatility, and contracts when volatility decreases.

The DoubleCCI_Woodies custom indicator is designed on two CCI, hence it is a momentum indicator.

As such the indicator is tailored to allow traders spot when a market is overbought or oversold, and it is expected to see a directional reversal and retracement.

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