Trading the markets is all about feelings. It's about human nature and the psychology of the crowd. Whether stock trading, gold, oil, commodities, cryptocurrencies or foreign exchange. There will always be those who are optimistic about a particular commodity and those who are pessimistic. They are called the bulls and the bears. Whoever proves to be stronger at any given time would win. As traders, it's not our job to guess which way the market is headed. Our job is to get a feel for the market. Who is currently stronger? Is it the cops or the bears?
The Bulls Bears Stop Forex Trading Strategy is a trading strategy that focuses on the idea of determining market sentiment. This strategy aims to profit from the Forex market by objectively measuring the strength of the bulls and bears. This gives us an indication of which direction we should go in order to consistently profit from the forex market. As long as we have an idea in which direction the market is going, the battle is half over.
Bulls and Bears Power Indicators
The bull and bear indicators are indicators that attempt to measure the strength of the bulls and bears in a market. This way, we get a feel for where the market is headed based on its strengths.
The Bulls and Bears indicator is a simple oscillating indicator that measures the distance between high and low and compares it to an exponential moving average (EMA). Positive bulls and bears indicate that both the highs and lows of the price are increasing relative to the average price. This means that the market sentiment is bullish. On the other hand, when the Bulls and Bears indicator is negative, it means that the highs and lows of price action are falling relative to the average price, which means that the market is bearish.
Chandelier stops or chandelier exits
The Chandelier Stops Indicator, also known as Chandelier Exits, is a trailing stop indicator that helps traders determine the ideal stop loss placement. It's similar to the Parabolic Stop and Reverse Indicator (PSAR), but it's a simpler version of it.
The Chandelier Stops indicator measures stop loss points based on the maximum value of high and low. Other versions use the maximum value of the deal. A buffer is then placed between the maximum value by calculating the Average True Range (ATR) for a certain period and adding it above the maximum high or subtracting it from the maximum low. In this way, traders can determine the safe margin within which to track their stop loss levels. The argument is that if the price were ever to reverse many times the ATR, it would be assumed that the trend has already reversed.
This trading strategy is a market sentiment based strategy that seeks to determine the trend based on the strength of the bulls and bears. This is done using the Bulls and Bears Power indicators.
Trades are made based on the direction of the bull and bear indicators. If the Bulls and Bears indicators are positive, a buy trade could be triggered. Conversely, if these indicators are negative, a sale could be initiated.
The Chandelier Stops indicator, which is a trailing stop indicator, would be used as a trend direction indicator. This particular version of the Chandelier Stops only draws the line that is opposite to the direction of the trend. Whenever the trend is bullish, the indicator only draws the bottom line. If the trend is bearish, it would only draw the top line. This conveniently tells us which direction the trend is based on the indicator.
Although the above entry signals are high quality, we will still filter out trades that go against the long-term trend. For this purpose we use the Exponential Moving Average (EMA) with 200 periods. This moving average is a widely used long-term trend indicator. Trades should only be made when the other three indicators are in line with the 200 EMA.
- 200 EMA (gold)
- Length: 28
- ATR period: 18
- Kv: 3.5
Time window: 4-hour and daily charts
Currency pairs: Major and minor pairs
Trading session: Tokyo, London and New York
Buy Trade Setup
- The price should be above 200 EMA, indicating a bullish long-term trend
- The Bulls and Bears Power indicators should be positive and indicate bullish market sentiment
- The Chandelier Stops indicator should show a blue line under the price action, indicating an uptrend
- Enter a buy order at the confluence of the above market conditions
- Set the stop loss to the support level below the entry candle
- Follow the stop loss below the blue Chandelier Stops line until the profit goes away
Sell Trade Setup
- The price should be below 200 EMA, indicating a bearish long-term trend
- The Bulls and Bears Power indicators should be negative, indicating bearish market sentiment
- The Chandelier Stops indicator should show a red line across the price action, indicating a bearish trend
- Enter a sell order at the confluence of the above market conditions
- Set the stop loss to the resistance level above the entry candle
- Follow the stop loss above the red Chandelier Stops line until the profit goes away
This trading strategy is a decently profitable trading strategy. It has a pretty decent win rate as the trend is based on market sentiment and the trades are filtered to match the long term trend. This way, we pick up trades that tend more towards our trade as there is less dynamic support and resistance that the trades have to overcome. This trading strategy also has a fair reward-risk ratio, which can increase from 2: 1 to 4: 1 depending on the market situation.
Forex Trading Strategy Installation Instructions
Bulls Bears Stop Forex Trading Strategy is a combination of Metatrader 4 (MT4) indicator (s) and template.
The essence of this forex strategy is to transform the accumulated history data and trading signals.
The Bulls Bears Stop Forex trading strategy provides the ability to spot various specifics and patterns in price dynamics that are invisible to the naked eye.
Based on this information, traders can assume further price movements and adjust this strategy accordingly.
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How Do I Install Bulls Bears Stop Forex Trading Strategy?
- Download Bulls Bears Stop Forex Trading Strategy.zip
- * Copy mq4 and ex4 files to your Metatrader Directory / Experts / Indicators /
- Copy the tpl file (template) into your Metatrader directory / templates /
- Start or restart your Metatrader client
- Select the chart and timeframe in which you want to test your forex strategy
- Right click on your trade chart and hover over "Template".
- Move right to select Bulls Bears Stop Forex Trading Strategy
- You will see that Bulls Bears Stop Forex Trading Strategy is available on your chart
* Note: Not all forex strategies come with mq4 / ex4 files. Some templates are already built into the MT4 indicators of the MetaTrader platform.
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