What is Forex Strategy | A question mostly asked by Forex Traders| Forex Strategy| Method of a Trader

 What is a Forex Strategy? A Forex strategy is a trading method used for trading in the Forex market, and every trader may have a different strategy. Some traders trade by analyzing support and resistance levels, some use indicators, while others use EAs (Expert Advisors) or robot trading systems. Here, I am going to explain a few trading strategies that, when applied properly, can help you achieve a very high winning ratio in trading.

Bollinger Bands Simple Strategy:

The Bollinger Bands indicator gives very good results in trading, even when used with its default settings. Bollinger Bands consist of three bands: an upper band, a lower band, and a middle (central) band.

The lower band usually signals traders to look for buy opportunities, while the upper band indicates potential sell opportunities. However, before using this indicator, it is very important to understand the direction of the major trend. Once you identify the major trend, applying Bollinger Bands can provide excellent results.

For example, if the major trend is bullish and you are using the 15-minute (15M) or 1-hour (H1) timeframe, you should closely watch the Bollinger Bands. If the trend is bullish, it is not always necessary for the market to move all the way down to the lower band for a buy entry. Sometimes, the market only touches the middle band and then reverses upward toward the upper band.

Therefore, instead of waiting for the price to touch the lower band, you can take a small buy entry near the middle band. Your Take Profit (TP) target can then be placed near the upper band.

I can guarantee that, if applied correctly with proper trend analysis, this strategy can provide highly successful trade setups.

This is a simple Strategy.

So, that was a simple Bollinger Bands strategy that provides very good results, and most traders commonly use this basic strategy. Now, I am going to explain an advanced-level Bollinger Bands strategy. Understand it carefully and apply it in your trading. Then, share your results in the comments below.

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Bollinger Bands Advanced Strategy

In this strategy, first you need to apply the standard Bollinger Bands indicator on your chart. After that, open the indicator settings.

Inside the settings, you need to change the levels according to the image provided below and add the following values:

• Add 1.5 in the upper level

• Add -1.5 in the second level

After adding these values, change the color of these new levels to green and red. The default upper Bollinger Band color is usually green, and you can leave it unchanged.

Once you complete these settings, your Bollinger Bands indicator will appear on the chart as shown in Picture below.

According to this strategy, you should ignore the green line, which is the default upper Bollinger Bands level. Instead, focus on the new level that was added at -1.5, represented by the red lines on the chart.

You should wait for the market price to reach either the upper red level or the lowest red level before placing a trade. These are considered the zones where smart money sweep traders are usually active, and where many traders’ stop losses are often targeted.

When placing your Stop Loss, keep it about 10 points beyond the red line level. Your Take Profit (TP) should be placed near the upper green level or the red level below it, depending on the market direction and setup.

However, it is very important to trade according to the major market trend and overall market direction:

• If the market trend is bullish, only take buy entries because sell entries may become risky.

• If the market trend is bearish, only take sell entries.

Again, I want to emphasize that you should not take a buy entry until the market reaches the lowest red level. Similarly, you should not take a sell entry until the market reaches the top red level. Also, always leave an additional 10-point gap beyond your entry zone before placing the Stop Loss.

I would also suggest that if you are a new trader, first test this strategy on a demo account before applying it on a live account. After testing it, make sure to share your experience in the comments below.

One important thing to note is that these settings will only work on MetaTrader 5 or MetaTrader 4. This means that if you try to apply these settings on TradingView, the settings may not be available there. Therefore, it is better to apply this setup on MT5 or MT4 according to your broker.

Personally, I tested this strategy on Exness, and the results were very good. One of the advantages of using this strategy on Exness is that the broker usually offers very low spreads. When the spread is low, the chances of your Stop Loss getting hit unnecessarily are also much lower.

However, you can apply this strategy on any broker that supports MT5 or MT4, so there is nothing to worry about. I am simply sharing my personal experience. Whenever it comes to fast execution, quick withdrawals, or low spreads, Exness is one of the brokers that comes to mind.

If you want, you can also try Exness by clicking on “Join Exness.”

If you are having difficulty setting it up or finding the process complicated, you can simply download the ready-made template from the link provided below and save it in your MetaTrader 5 templates folder. After that, open MT5 and apply the template to your chart. Your indicator will automatically be activated with all the required settings already configured.

(Download Template)

If you still face any difficulty or do not understand something, you can ask your question or describe your issue freely using the comment box below this post. Alternatively, you can also contact us through our contact page and send us an email.