How to Trade Forex Bollinger Bands with Zigzag and Commodity Channel Index (CCI) in Forex

Forex Bollinger Bands Trading System – Bollinger Bands® are one of the most popular technical indicators for traders in any financial market, whether investors are trading stocks, bonds or foreign exchange (FX). Many traders use Bollinger Bands® to determine overbought and oversold levels, selling when price touches the upper Bollinger Band® and buying when it hits the lower Bollinger Band®.

 
The purpose of Bollinger Bands is to provide a relative definition of high and low. By definition prices are high at the upper band and low at the lower band. This definition can aid in rigorous pattern recognition and is useful in comparing price action to the action of indicators to arrive at systematic trading decisions.
 
One of the other great advantages of Bollinger Bands® is that they adapt dynamically to price expanding and contracting as volatility increases and decreases. Therefore, the bands naturally widen and narrow in sync with price action, creating a very accurate trending envelope.
 
Commodity Channel Index (CCI)
 
The CCI was originally developed to spot long-term trend changes but has been adapted by traders for use on all time frames. Here are two strategies that both investors and traders can employ.
 
The CCI compares the current price to an average price over a period of time. The indicator fluctuates above or below zero, moving into positive or negative territory. While most values, approximately 75%, will fall between -100 and +100, about 25% of the values will fall outside this range, indicating a lot of weakness or strength in the price movement.
 

Forex Bollinger Bands Trading Rules

 

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How to Trade Forex Bollinger Bands with Zigzag and Commodity Channel Index (CCI) in Forex. This trading system based on the bollinger bands and Zig Zag.  The best Time Frame : 15 min or above. (But This trading system works on all time frame). Best Currency pairs : major pairs.

Meta Trader Indicators :

  • Bollinger bands (20, 3) and (20,2)
  • Zigzag Line indicator (2 period)
  • Zigzag Pointer indicator (10, 5, 15 period) (for Metatatrader user) Zig Zag indicator (12, 5, 3)
  • T3 CCI indicator (14) with levels 100 and -100
  • Stochastic indicator 11-5-5
  • Bollinger bands (20, 3) and (20,2)

 

BUY Rules
  • Price touch or close the bottom Bolllinger bands indicator;
  • Zigzag Line indicator and Zig Zag Pointer indicator meet together on the same candle;
  • T3 CCI indicator get over -100 level;
  • Stochastic Oscilltor indicator crossed and pointing up.
  • Entry when price closed into Bollinger Bands (20.2 ) at open next bar.

 

SELL Rules
  • Price touch or close the Top Bolllinger bands indicator;
  • Zigzag Line indicator and Zig Zag Pointer indicator meet together on the same candle;
  • T3 CCI indicator get over 100 level;
  • Stochastic Oscilltor indicator crossed and pointing down.
  • Entry when price closed into Bollinger Bands (20.2 ) at open next bar.

 

EXIT Position
  • Profit Target 60-20 pips depnds by currency pairs.
  • Profit Target also on the middle band.
  • Place Stop loss below or above entry candle.
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This Trading System is also good for trading on the Binary Options. This is a Binary Options Strategy One Touch.
 
Forex Bollinger Bands with Zigzag and Commodity Channel Index (CCI) in Forex can be used on any market or time frame. One time frame can be used, but trading with two will provide more signals for active traders.
 
Use the Forex Bollinger Bands with Zigzag and Commodity Channel Index (CCI) on the longer-term chart to establish the dominant trend, and on the shorter-term chart to isolate pullbacks and generate trade signals.


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