Tag: FTSE 100 scalping

FTSE100 BB Scalping strategy

Scalping Strategy–FTSE100  5 min Bollinger Bands scalping

Here is a very simple strategy but you do need to familiarize yourself with this strategy before you start using this strategy. It can be effective as it can stop you out quiet frequently. You can trade this on the FTSE100 on a 1min, 5min, 15 min time frame.

Do Not trade this ahead of important data or news.  Do Not Trade when there is a lot of strong bad news or good news in the market as the FTSE100 is likely to take a direction. Best to trade it after the FTSE open and before the 13.30 economic data or US open.  Unless the economic data that is coming out has no importance.

Settings:
Bollinger Bands 50 period, 2 Standard deviation (magenta)
Bollinger Bands 50 period, 3 Standard deviation (blue)
Bollinger Bands 50 period, 4 Standard deviation (orange)

Spread betting Rules:
Go Long when the price crosses the first Bollinger Band (magenta) to the downside, moving towards the second Bollinger bands (Blue), when it fails to reach the blue band and moves back up, this is when you go long, with your stop loss below the low the candle.
If, instead, the prices cross the blue Bollinger band moving lower towards the orange Bollinger band but fail to break the orange band and moves back up towards the centre of the bands, again this is where you buy and go long with stoploss below the low of the candle. Remember, this time while the prices were moving lower they must not have stalled between the magenta and blue. If you get stopped out, just wait for the next signal.

Go short when the opposite happens.
Scenario A. Prices move higher breaking the magenta bollinger band but failing to reach the blue bollinger band. It moves back towards the centre of the bands, go short with stoploss just above the band.
Scenario B. Prices moves past the magenta and blue bands to then stall between blue and orange. At this point, as prices move back into the bands, tanke a short trade with stio above the spike candle.

In both scenarios, being patient and waiting for the correct setup, is the key to trading.

Ideal scenario: when the markets are trading sideways, or the market is quiet with news to come out in a few days and prices are mainly moving sideways with occasional runs up or down.

What to be careful with this is when there is very strong news and the FTSE100 takes a direction. This is a mean reversal strategy, and we don’t want the FTSE100 to move in one direction.

 

Below is a when the strategy works really well. Prices break the first bollinger band then retraces.

 

 

This is a second example of this . Here we get stopped out as soon as prices move in a trend. As you can see from the time, it is after 13.30. There was economic data that made the markets take a trend.

Any queries, post a comment and I will be happy to answer

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ADX and Bollinger Band

ADX and Bollinger Band spread betting strategy

Time frame: 5 Min

Indicators used / Settings:

(14)

(20, 2)

 

Charts used: FTSE 100

Possible other spread betting charts:GBP

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Entry Rules:

When the ADX is above 25, this indicator tells you that a trend is underway. The whole point of this scalping  the FTSE strategy, is to find moments when there is no trend and the FTSE 100 is trading sideways or is consolidating after a move.  The whole purpose of this is to be patient. Once the FTSE 100 is consolidating you apply a mean reverting spread betting strategy. 

 

Spread-betting long:

When the ADX is below 25, as the UK100 has stalled after a strong trend, or there is no news and the FTSE is trading sideways. Wait for the prices to drop and touch the lower band. As you see the prices reversing going back up towards the middle 20 moving average line, spread bet  long.

You don’t want the price to break the band and close below the band. If the current candle closes below the lower band wait for the first candle to close back above the lower band. Then trade long.

 

Spread-betting short:

Again the ADX is below 25 and the FTSE is trading sideways. Wait for the prices to move up towards the upper band. As you see the prices reversing going back down towards the middle 20 moving average line, spread bet  short.

Ideally you want the prices to touch the bands and move lower / higher. If the prices close above the bands wait for the next bar to close inside the bands.

Strategy does require patience.

 

Exit Rules:

This is a scalping strategy. Use 5 – 10 point profit and 10 – 15 point stop loss.

stop loss: 15

target: 5-10

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Here is a spread betting example of this ADX and Bollinger Band strategy applied to the FTSE100

 

FTSE 100 - Scalping 5 Min ADX BB

 

In the spread betting example below of the uk100. Prices did bounce off the lower Bollinger band, but failed to move higher. Be careful when prices do not follow through past the middle SMA heading towards the top band. , could indicate a change in trend.

FTSE 100 - Scalping 5 Min ADX BB_2

This spread betting strategy can also be applied on :

FTSE, DJI, GBP, Oil

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