The Advanced Bollinger Bands MT4 forex indicator is an advanced version of the traditional Bollinger Bands indicator, invented by John Bollinger.
In an uptrending market, the Bands are pointing to the upside; in a downtrending market, the Bands are pointing to the downside.
This indicator is useful and efficient for scalping (M1, M5 charts), day trading (M5, M15 charts), swing trading (M30, H1 charts) and position trading (H4, D1 charts) for any currency pair.
This indicator can be fully customized directly from the indicator’s input tab.
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Download the “advanced-bollinger-bands.ex4” MT4 indicator
Indicator Chart (EUR/USD H1)
The EUR/USD H1 chart below displays the Advanced Bollinger Bands forex indicator in action.
Basic Trading Signals
Signals from the Advanced Bollinger Bands indicator are easy to interpret and goes as follows:
Buy Trade: The bands must be pointing up. Open buy trade in the red area of the Bollinger Bands indicator. Exit the buy trade in the green area or use your own method of trade exit.
Sell Trade: The bands must be pointing down. Open sell trade in the green area of the Bollinger Bands indicator. Exit the sell trade in the red area or use your own method of trade exit.
Advanced Bollinger Bands and RSI Triple Stochastic Divergence Forex Scalping Strategy
This MT4 scalping strategy combines the trend and volatility cues from the Advanced Bollinger Bands Metatrader 4 Forex Indicator with the momentum divergence signals from the RSI Triple Stochastic Divergence Indicator MT4.
The Advanced Bollinger Bands help identify trend direction by measuring whether the bands are rising (bullish) or falling (bearish).
The RSI Triple Stochastic Divergence indicator uses a histogram above zero for bullish divergence and below zero for bearish divergence, helping confirm entry timing.
This strategy is designed for scalping on short timeframes such as M5 and M15 where quick, small moves are more common.
By combining volatility trend with momentum divergence, you focus on trades that respect both underlying price structure and near-term signal strength.
It is suitable for traders who want clear rules and reduced noise in entry decisions.
Buy Entry Rules
- The Advanced Bollinger Bands are rising, indicating a bullish trend and volatility expansion to the upside.
- The RSI Triple Stochastic Divergence blue histogram is above zero, signaling bullish divergence momentum.
- Enter a buy trade at the close of the candle where the histogram first moves above zero while the bands are rising.
- Place the stop loss a few pips below the recent swing low or below the lower Bollinger Band.
- Exit the trade when the histogram turns below zero or the bands begin to flatten or turn downward, indicating weakening momentum.
Sell Entry Rules
- The Advanced Bollinger Bands are falling, indicating a bearish trend and volatility expansion to the downside.
- The RSI Triple Stochastic Divergence red histogram is below zero, signaling bearish divergence momentum.
- Enter a sell trade at the close of the candle where the histogram first moves below zero while the bands are falling.
- Place the stop loss a few pips above the recent swing high or above the upper Bollinger Band.
- Exit the trade when the histogram turns above zero or the bands begin to flatten or turn upward, indicating weakening momentum.
Advantages
- Combines trend and momentum divergence for higher quality scalping signals.
- Clear rising and falling band structure helps define market direction and volatility expansion.
- The divergence histogram adds early momentum confirmation before price runs out of steam.
- Effective on multiple short timeframes such as M5 and M15.
- Simple rules help reduce hesitation and increase consistency.
Drawbacks
- Divergence signals can occasionally lag price action in fast reversals.
- Requires discipline to exit when momentum weakens rather than holding for larger moves.
- Spread and slippage can reduce net scalping profits, especially on pairs with higher costs.
Case Study 1 – EURUSD M5
On EURUSD in an M5 timeframe, the Advanced Bollinger Bands began rising after a brief pullback, signaling renewed bullish pressure.
Shortly after, the RSI Triple Stochastic Divergence histogram moved above zero.
A buy trade was entered at the close of that candle with the stop loss placed just below the lower band and recent swing low.
Price continued higher over the next several bars, and the histogram stayed above zero until the bands started flattening.
The trade was closed as momentum weakened, capturing 14 pips in profit in a tight scalping move.
Case Study 2 – GBPUSD M15
On GBPUSD using the M15 timeframe, the Advanced Bollinger Bands were trending downward, indicating bearish pressure.
The RSI Triple Stochastic Divergence histogram then dropped below zero.
A sell trade was entered at the close of the signal candle with the stop loss placed just above the upper band and recent swing high.
Price continued lower and the histogram remained below zero for multiple bars before turning upward.
The trade was exited as the histogram turned above zero, capturing 36 pips as the market began to shift.
Strategy Tips
- Wait for clear band direction before entering; avoid trades when the bands are flat or crossing frequently.
- Confirm that momentum divergence aligns with band direction to increase the probability of a successful scalp.
- Use tighter stop losses in low volatility conditions and wider ones during high volatility to reduce premature stop outs.
- Avoid entering just as major news events release, as price spikes can trigger stops even in strong trends.
- Focus on high liquidity hours like the London and New York overlap for better trend continuation after entry.
- Practice discipline in exiting trades when the histogram turns against you, rather than waiting for a larger move confirmation.
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Download the “advanced-bollinger-bands.ex4” Metatrader 4 indicator
MT4 Indicator Characteristics
Currency pairs: Any
Platform: Metatrader 4
Type: chart pattern
Customization options: Variable (Show_Gauge, myChartY, myChartX, Show_PriceBox, BandsPeriod, BandsDeviations) Colors, width & Style.
Time frames: 1-Minute, 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours, 1-Day, 1-Week, 1-Month
Type: Trend
