The Bollinger Bands (BB) Cloud indicator for Metatrader 5 measures market volatility and it can be used for trade entry and exit signals.
The indicator pops-up in the main chart as two colored Bollinger bands and a middle line.
Wide Bollinger Bands indicate high market volatility while narrow Bollinger bands indicate low market volatility.
How to determine bullish and bearish market sentiment with the BB Cloud indicator?
- A bullish trend occurs when the Bollinger bands are going up.
- A bearish trend occurs when the Bollinger bands are going down.
The indicator contains the following inputs and parameters: period, first deviation, second deviation.
Make yourself familiar with this technical indicator and test it first on a demo account.
It supports all time frames and Forex pairs.
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The following chart shows how the BB Cloud indicator looks like when applied to the MT5 chart.
How To Buy And Sell Forex Pairs With The BB Cloud Forex Indicator?
Find a simple trading example below:
- A buy signal is given when the Bollinger Bands are pointing to the upside (bullish trend) and price touches the lower blue Bollinger Band (buy on dips).
- Open a buy order and place your stop loss 5 pips below the lower blue Bollinger band.
- Close the long trade for a reward to risk ratio of at least 1.5, or exit the trade when price touches the upper brown Bollinger Band.
- A sell signal is given when the Bollinger Bands are pointing to the downside (bearish trend) and price touches the upper brown Bollinger Band (sell on rallies).
- Open a sell order and place your stop loss 5 pips above the upper brown Bollinger band.
- Close the short trade for a reward to risk ratio of at least 1.5, or exit the trade when price touches the lower blue Bollinger Band.
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Frequently Asked Questions
How Do I Install This Custom Indicator On Metatrader 5?
- Open the MT5 trading platform
- Click on the File menu button located at the top left part of the platform
- Click on Open Data Folder > MQL5 folder > Indicators
- Copy the BB_Cloud.mq5 indicator file in the Indicators folder
- Close and restart the trading platform
- You will find the indicator here (Navigator window > Indicators)
- Drag the indicator to the chart to get started with it!
How Do I Edit This Indicator?
- Click in the open chart with your right mouse button
- In the dropdown menu, click on Indicator List
- Select the indicator and click on properties
- Now you can edit the inputs, colors, levels, scale and visualization
- Finally click the OK button to save the new configuration