If you’re looking to ramp up your trading game, you’ll want to check out the original trading strategy detailed here.
This EA (Expert Advisor) was specifically developed to put this trading strategy to the test. You can find the results and a breakdown of the EA parameters in the latest magazine issue.
Overview of the EA Algorithm:
- Timeframes: H1-D
- Tool: Bollinger Bands with a shift of 1, 2, 3. Period: 20; Volume: integer lot (0.2, 0.4, 0.8, 1.0, etc.)
- Indicator: RSI, period 14
Finding a Buying Signal:
- RSI must be below 30.
- Price needs to hit the lowest Bollinger Band.
- Wait for the hourly candlestick to close above the second lowest Bollinger Band.
- Once the first candlestick closes above this line, it’s time to buy.
- Set your Stop Loss 10 pips below the latest local minimum.
- First target for half of your position is equal to your Stop Loss; as soon as this is hit, adjust your Stop to break-even.
- Second target is at the second upper Bollinger Band.
Finding a Selling Signal:
- RSI must be above 70.
- Price needs to touch the highest Bollinger Band.
- Wait for the hourly candlestick to close below the second upper Bollinger Band.
- When the first candlestick closes below this line, you should sell at market.
- Set your Stop Loss 10 pips above the latest local maximum.
- First target for half of your position equals your Stop Loss; adjust your Stop to break-even once this is hit.
- Second target is at the second lower Bollinger Band.
Testing the EA with Standard Parameters:
After optimizing the parameters:
For a comprehensive analysis of the strategy with a forward test, check out our magazine.
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