Bollinger ATR Bounce Swing Forex Trading Strategy

Bollinger ATR Bounce Swing Forex Trading Strategy is based on a custom made indicator that uses market data and some familiar technical tools reading to generate the trading positions.

This strategy works fine on any forex currency pair and the recommended time frames are hourly (1-hour) and 4-hour charts.

This indicator can be called a combination of Bollinger band and ATR indicator, which has four bands. Although there are many other band-based indicators, Bollinger bands are probably the most famous indicator that uses channels or bands.

The basic difference between the band-based indicators is at the parameters, how the bands are computed and plotted, or only at the calculation method, and they work at the right parameter.

A large number of traders are very familiar with the Bollinger bands and how to use this indicator. Price at the upper band indicates an overbought situation, and the price candles remain lower bands for an oversold condition of the asset price.

When the volatility gets lower at the asset price, the bands get closer, which may be a pre-breakout condition. The bigger the breakout, the bands are wider.

This custom-made indicator doesn’t have three bands as the traditional Bollinger bands, only the upper and lower band (without middle band).

Another set of (red-colored) bands at this indicator outside is based on another indicator called Average True Range (ATR). Those outer band areas can be used as dynamic support and resistance areas.

Before making any entry verify the price direction from the upper time frames window is recommended. Price touches the lower (blue) band, waits until the sell volatility dooms, and after confirmation of bullish pressure, places buy orders and vice versa.

Don’t be in a rush to take entry cause price can remain at any (upper or lower) band as long as the demand remains intact.

Avoid trading major pairs with this strategy during NFP, FOMC meeting minutes, FED rate decisions, or any other major trend changing volatile fundamental economic events.

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