Alligator tunnel bounce 2.0 forex strategy

This system could be easily called alligator bounce scalping forex strategy 2.0. However, it is not better (it might be in some aspects) but it is different. The liquidation model was modified to try to find the best possible time for closing with profit, while still protecting each entry with trailing stop. Once again, this is a strategy that produced some amazing results in our historical data tests.

  Get MT4 Expert Advisor trading this Forex strategy ↴ 

Backtest and optimize for any currency pair. Trade multiple instruments simultaneously, day and night.

Trade automatically, without errors and emotions. Save your time and energy. 

In short: We use alligator with high calculation period to identify trend. Once we do so we look for BB tunnel bounce. We understand bounce as price briefly penetrating the tunnel only to return back within to continue to move in trend direction.

We use trailing stop for protection (advanced, bollinger band based). In this trading system, we will also use RSI indicator to try and time the best possible price for exit.

 

The system was tested in over 13 years of historical data (Tick 1H EURUSD chart since 2003). Test is pretty accurate as it uses candle close for the entry.

 

Used tools and indicators

Alligator (600,400,250) The main trend identification tools. All trades must follow the trend when entered.

 

Bollinge bands (BB period 40, deviation 1) Volatility dependent tunnel will be used to identify the bounce. Period and deviation of BB can be easily manipulated to adapt it any time frame and currency pair.

 

Volumes.VSA signal will be used. We will consider activity on candle as it approaches the tunnel boundaries. We will also observe it as the price closes back within the tunnel. Generally, this works amazingly well in avoiding the breakouts.

 

Relative strength index (RSI 42,primarily closing method). We will be looking for RSI to enter and leave

overbought/oversold zone. As this signalizes possible reversal, we will exit all of our winning trade for adequate direction.

 

Trailing stop (extra deviation for trail stop 80 pips): It will be based on bollinger band that bounced the price of our position.

 

Forex strategy rules

For the best results, trade with professional ECN/STP broker with MT4. If you can't trade with profit. Automatically copy the traders that are already profitable.

 

SELL

All alligator lines aligned according to downtrend, from the slowest at the top to the fastest at the bottom. This reliably identifies downtrend.

 

Look for short entry with following rules:

Price penetrates upper BB (with candle close or high) once it closes back within the tunnel we consider the volumes.

Candle that penetrated the BB must have lower volume than previous candle. Candle that closed back in the tunnel must hall higher volume than previous candle.

 

We enter on candle close, placing trailing stop at the upper BB + extra deviation for trail stop.

All short trades are closed once the RSI falls below 30 line and then closes back above it.

 

BUY

All alligator lines aligned according to uptrend, from the slowest at the bottom to the fastest at the top. This reliably identifies uptrend.

 

Look for long entry with following rules:

Price penetrates bottom BB (with candle close or low) once it closes back within the tunnel we consider the volumes.

Candle that penetrated the BB must have lower volume than previous candle. Candle that closed back in the tunnel must hall higher volume than previous candle.

 

We enter on candle close, placing trailing stop at the bottom BB - extra deviation for trail stop.

All short trades are closed once the RSI rises above 70 line and then closes back below it.

For the best results, trade with professional ECN/STP broker with MT4. If you can't trade with profit. Automatically copy the traders that are already profitable.

Get MT4 expert advisor trading this forex strategy

For best results, use this forex strategy with one of our trusted forex brokers

(STP/ECN with MT4 bridge).

To win you must trade with broker on your side.

 

 

Disclaimer:  Expert advisor was tested for profitability on historical data. All screen shots provided are displaying real results of the test. However past data will never guarantee future success. Every expert advisor needs to be tested properly on demo account. LIVE use only on your own risk. Read full disclaimer. TheForexKings Team does not give any financial advice. TheForexKings does not take any responsibility for any user’s investments and investment decisions. All rights reserved. Strictly for personal use.

 

Please reload

ABOUT US

THEFOREXKINGS

“Trading FOREX since 2006. Full time trader and web developer since 2013. My two biggest hobbies are trading and web development. In TheForexKings I managed to connect both of them. Even after 12 years of trading I still have the same passion for the market as at the beginning. The aspect I enjoy the most : development and testing of new ideas.” 

 

Only in 2016 - 2017 we have created more than 400 forex strategies. During this period we have also developed and published +200 MT4 Expert advisors based on those strategies. We are dedicated to provide you with viable and complete trading systems that have thrived in extensive historical testing. We want to give you complete and transparent trading solutions, that once mastered ,will set you financially free. We want to give you a fighting and winning chance in the market. ” 

—  Marian, Proprietor of TheForexkings.com