Example A3: Bollinger bands trading
This is not a ready-to-use trading strategy. A trading strategy requires adjustment to the timeframe and symbol, along with thorough backtesting. The example is intended as a foundation for your own custom strategy and to help you get familiar with the Expert Advisor Builder web application. To import and use an example, please follow the instructions provided here.
Description
This example introduces Bollinger Bands trading, a popular strategy that identifies potential entry points when price breaks through statistical boundaries. The system generates long signals when the opening price crosses below the lower Bollinger Band, suggesting an oversold condition that may reverse upward. All three Bollinger Band lines are displayed on the chart for visual confirmation.
The strategy uses a fixed 100 pip stop loss, making risk calculation straightforward for position sizing. The take profit maintains the standard 1.40 risk ratio, targeting 140 pips of profit. This fixed approach works particularly well in ranging markets where price tends to bounce between the bands.
Bollinger Bands adapt to market volatility automatically, widening during volatile periods and narrowing during calm markets. This self-adjusting nature makes the strategy suitable for various market conditions.
Recreate the Example
You can either import this example directly or set it up manually. To manually replicate the trading module, make sure a newly added module includes the following key settings and that the professional mode is activated:
Trade Basics
- Operation type = Long
Signal Generation - Indicators (BB Main)
- Signal in use = On
- Signal used for = Forward
- Selected indicator = BB
- Line index = Main
- Draw in chart = On
- Drawing slot = 1
Signal Generation - Indicators (BB Upper)
- Signal in use = On
- Signal used for = Forward
- Selected indicator = BB
- Line index = Upper
- Draw in chart = On
- Drawing slot = 2
Signal Generation - Indicators (BB Lower)
- Signal in use = On
- Signal used for = Forward
- Selected indicator = BB
- Line index = Lower
- Draw in chart = On
- Drawing slot = 3
Signal Generation - Indicators (PRICE)
- Signal in use = On
- Signal used for = Entry
- Selected indicator = PRICE
- Series = Open
- Draw in chart = On
- Drawing slot = 4
Signal Generation - Indicator Combinations (PRICE Open & BB Lower)
- Signal in use = On
- Signal used for = Entry
- Input indicator 1 = PRICE (Open)
- Input indicator 2 = BB (Lower)
- Value relation = Value 2 cross value 1
Initial Stop Loss
- Selection = Rate of change
- Rate change = 0.00100000
Initial Take Profit
- Selection = Risk ratio
- Risk ratio = 1.40
Screenshots
