A Simple Way to ScalpForex Market-Live Orders
The Squeeze This is main tool in my system .And volatility graphic charts helpme to locate approximately the moment of breakout . EUR/JPY - 21/03/2014
EUR/JPY - 21/03/2014
We can see easily that from 0 to 7:00 the market has low volatility ( red rectangle) .But from 7:00 to 17:00 (blue rectangle) GMT high volatility .Price direction we decide with RSI and EMA 5 .
Like in graphic chart price contraction happened at about 7:00,blue doted line.This we waiting for signal.
In picture above Entry Order (Sell) is shown by RSI and EMA 5,price cross 50 level of RSI and EMA 5 cross middle band from BB . That is .
And now after 5 hours :
One of the most well-known theories in regards to Bollinger Bands is that volatility typically fluctuates between periods of expansion (Bands Widening) and contraction (Bands Narrowing). With this in mind, the major trading signal generated by Bollinger Bands Width is known as "The Squeeze".
The Squeeze setup is very straightforward and consists of two steps:
There is a period of low volatility. The means that price is moving relatively sideways.
The low volatility period is followed by high volatility and price breaks through the Upper Band or falls through the Lower Band signifying a change in the sideways movement and the beginning of a new directional trend.
In a Bullish BB Squeeze
Price breaks through the Upper Band which starts a new upward trend. Volatility also increases.
In a Bearish BB Squeeze
Price falls below the Lower Band which starts a new downward trend. Volatility also increases.
SUMMARY
Bollinger Bands can be a useful technical analysis tool for identifying "The Squeeze" which can result in some nice buying or selling signals. Of course the trader should always use caution. Sometimes the breakout after a Squeeze setup has an
immediate pullback and the rally never happens. For this reason I used in my system RSI and EMA 5.These indicators help me to filter fake signals.
I will post daily Entry Orders (Buy or Sell) from Entry to Stop , but only when we have news .No news,all day low volatility.