Some currency traders are eager to measure price volatility and at the same time try to make sense off it, along with its impact on price in the near and long term.
This is one of the reasons why our trading strategy is designed around volatility, while offering clear signals on when to buy/sell.
The Volatility Hyper Trend forex strategy includes entry, stop-loss and take profit (exit the trade) and can be applied to any forex pair.
Let’s get started with the chart setup:
Chart Setup
MetaTrader4 Indicators: Triggerlines2.ex4 (Input Variable Modified; Rperiod=36), Volatility Hyper Trend.ex4 (Default Setting)
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 setup gets put on display:
- If the double blue lines of the Triggerlines2 custom indicator gets aligned somewhat below price bars as depicted on Fig. 1.0, price is said to be pushed to the upside i.e. a trigger to buy the stipulated currency pair.
- If the blue upward pointing arrow of the Volatility Hyper Trend custom indicator gets aligned on the activity chart, while the indicator’s thick red line intersects its thin green line bottom up, then price is said to be pushed higher, hence fulfilling a buy signal condition.
Stop Loss for Buy Entry: Place stop loss 1 pip below support.
Exit Strategy/Take Profit for Buy Entry
Exit or take profit if the following rules or conditions take precedence:
- If the Triggerlines2 custom indicator lines reverts to red while a buy signal is ongoing, then it is time to pack up your buy positions i.e. an exit or take profit should be promptly considered.
- Wait for the red line of the Volatility Hyper Trend custom indicator to change to blue, before considering whether to exit or take profit.
Sell Entry Rules
Enter a sell order if the following holds true:
- If the double red lines of the Triggerlines2 custom indicator gets placed somewhat above price bars as shown on Fig. 1.1, price is said to be pressured lower i.e. a trigger to sell the designated forex pair.
- If the red downward pointing arrow of the Volatility Hyper Trend custom indicator gets aligned on the price chart (usually above the candlesticks), while the indicator’s thick blue line intersects its thin green line in a top downward manner, it is an indication of a bullish trend.
Stop Loss for Sell Entry: Place stop loss 1 pip above resistance.
Exit Strategy/Take Profit for Sell Entry
Exit or take profit if the following takes center stage:
- If the Triggerlines2 custom indicator lines returns to blue while a sell signal is continuing, then it is wise to cut down on your sell order, as such an exit or take profit should be well thought-out.
- If the running blue line of the Volatility Hyper Trend custom indicator reverts to red (within its indicator window) as depicted on Fig. 1.1, an exit or take profit should be readily considered.
Sell Trade Example
Fig. 1.1
Free Download
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About The Trading Indicators
The Triggerlines2 is a custom indicator that is designed after the moving average but is made up of two lines, with changing colors, red signifies a bears market, while blue is for bulls.
The Volatility Hyper Trend custom indicator is a custom popular MT4 indicator that does not repaint and delivers alert signals.