As the name suggests, the ATR Trailing Stop Loss Alerts indicator for MT4 provides traders with easy-to-read and accurate trailing stop loss signals.
The indicator draws Average True Range (ATR) based colored dots above and below the actual price.
For buy trades, trail your stop loss up 1-3 pips below the blue dots until you get stopped out of the long trade.
For sell trades, trail your stop loss down 1-3 pips above the red dots until you get stopped out of the short trade.
The inputs tab of this indicator contains a lot of adjustable parameters.
Feel free to experiment with its settings to optimize the trailing stop loss indicator for your needs.
Free Download
Download the “ATRTrailStopV3 alerts.ex4” MT4 indicator
Indicator Chart (EUR/USD H1)
The EUR/USD H1 chart below displays the ATR Trailing Stop Loss Alerts Metatrader 4 forex indicator in action.
Basic Trading Signals
Trailing Stop Loss Signals from the ATR Trailing Stop Loss Alerts MT4 forex indicator are easy to interpret and goes as follows:
Trail Up Signal: Trail your stop loss up below the blue indicator dots. Keep trailing up your stop loss until you get stopped out from the buy trade.
Trail Down Signal: Trail your stop loss down above the red indicator dots. Keep trailing down your stop loss until you get stopped out from the short trade.
ATR Trailing Stop + EW Trend Indicator Scalping Strategy (MT4)
This strategy uses the ATR Trailing Stop Loss Alerts MT4 Indicator together with the EW Trend Indicator for Scalping MT4.
On M1 and M5 charts, this combination lets you scalp with the trend while keeping your risk managed dynamically using ATR-based trailing stops.
Why This Strategy Works
The ATR Trailing Stop Loss Alerts indicator plots dots above or below the price based on volatility (ATR).
Blue dots (below price) indicate a bullish trailing-stop region, red dots (above) a bearish region.
By trailing your stop to these dots, you lock in profits and protect against reversals.
The EW Trend indicator gives a fast directional signal: when its scalping line is above zero, the bias is bullish; when it’s below zero, bearish.
Using them together means you only take trades when the trend (EW) aligns and manage the trade safely with ATR-based stops.
Scalping on M1 and M5 gives many opportunities while keeping the trades very short and precise.
Buy Entry Rules
- Confirm the EW Trend scalping line is above zero.
- Enter a buy position when that condition holds and the price shows some upward momentum (for example, a bullish candle or small pullback).
- Place your initial stop loss below the most recent swing low (or a few pips below it).
- As soon as the trade is open, trail your stop loss using the ATR trailing stop: move your SL to 1–3 pips below the blue ATR dots as they appear.
- Take profit when either a reversal is confirmed by EW Trend (scalp line drops below zero), or when you have captured a reasonably small pip gain.
Sell Entry Rules
- Confirm the EW Trend scalping line is below zero.
- Enter a sell position when that bearish condition is confirmed and the price moves downward (or after a small pullback).
- Set your initial stop loss above the most recent swing high (or a few pips above it).
- Trail your stop loss using the ATR trailing stop: move it to 1–3 pips above the red ATR dots as they form.
- Take profit when EW Trend flips above zero, or after capturing a small target profit.
Advantages
- Dynamic risk management: the ATR indicator helps trail your stop in real time, so you don’t give back too much profit.
- Trend-aligned scalping: EW Trend ensures you only trade in the direction of short-term momentum.
- Suits very short timeframes (M1, M5): ideal for scalpers.
- Reduces emotional trading: the method is rule-based and structured.
- Low barrier to entry: You don’t need to hold trades for long, reducing exposure.
Drawbacks
- False EW Trend signals can occur in choppy markets.
- The ATR trailing stop may be too tight in low-volatility conditions, triggering early exits.
- Frequent trades can lead to higher transaction costs (spreads/commissions).
Example Case Study 1
On the EURUSD M5 chart during the London session, the EW Trend line gradually moved above zero, signaling growing bullish strength.
A brief pullback followed, then a clean bullish candle formed.
A buy trade was opened at the close of that candle, with a stop loss placed just below the recent swing low.
As the trade developed, blue ATR dots appeared under the price, and the stop loss was trailed upward as each new dot formed.
Price climbed steadily, moving about 14 pips in the trader’s favor.
When the EW Trend line flattened and began to dip toward the zero level, the trade was closed manually.
This exit protected nearly the entire 14-pip move before a small correction pulled the price back down.
Example Case Study 2
On the GBPUSD M1 chart during the US–London overlap, the EW Trend line dropped below zero, showing that bearish pressure was building.
A strong bearish candle broke out of a small consolidation zone.
A sell position was opened on the close, with the stop loss placed a few pips above the breakout area.
Soon after entry, red ATR dots appeared above the price, and the stop loss was trailed closely above each new dot.
Volatility increased, and price slid rapidly, delivering a quick 11-pip move within just a few minutes.
As the EW Trend line rose back toward the zero level, the trader exited the position, securing the majority of the 11-pip drop before the market began to retrace.
Strategy Tips
- Use currency pairs with low spreads and good liquidity to make scalping efficient.
- Optimize the ATR period/multiplier in the ATR trailing stop indicator inputs to suit M1 and M5 volatility.
- Consider using a small fixed take profit in addition to the trailing stop, especially on very volatile pairs.
- Backtest this strategy on a demo account first to find the best settings for your broker and preferred pairs.
- Maintain strict risk management: risk only a small percentage per trade, since scalping trades are very frequent.
Download Now
Download the “ATRTrailStopV3 alerts.ex4” Metatrader 4 indicator
MT4 Indicator Characteristics
Currency pairs: Any
Platform: Metatrader 4
Type: chart window indicator
Customization options: Variable (back period, ATR period, factor, median price, median base, close base, alerts) Width & Style.
Time frames: 1-Minute, 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours
Type: stop loss
