DPO BB MTF Forex Indicator (MT4)

About the DPO BB MTF Indicator

The DPO BB MTF (Detrended Price Oscillator with Bollinger Bands and Multi-Timeframe) is a sophisticated technical analysis tool designed for MetaTrader 4.

It combines the Detrended Price Oscillator (DPO) with Bollinger Bands across multiple timeframes, providing traders with a comprehensive view of market conditions.

This indicator helps in identifying short-term price cycles, overbought and oversold levels, and potential breakout points, making it a valuable asset for both trend-following and mean-reversion strategies.

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Key Features

• Integrates DPO with Bollinger Bands for enhanced market analysis.
• Supports multiple timeframes, allowing for a broader perspective.
• Helps identify overbought and oversold conditions.
• Assists in pinpointing breakout and reversal points.

Indicator Chart (EUR/USD M15)

The example chart below displays the DPO BB MTF MT4 indicator in action on the trading chart.

Buy and Sell Trading Rules

Buy Rules

• Enter a buy position when the DPO crosses above the zero line and the price breaks above the upper Bollinger Band.
• Confirm the signal with the multi-timeframe trend indicator showing bullish conditions.
• Set a stop loss below the recent swing low or a significant support level.
• Take profit at the next significant resistance level or based on a predetermined risk-reward ratio.

Sell Rules

• Enter a sell position when the DPO crosses below the zero line and the price breaks below the lower Bollinger Band.
• Confirm the signal with the multi-timeframe trend indicator showing bearish conditions.
• Place a stop loss above the recent swing high or a significant resistance level.
• Set a take profit target at the next support level or according to your risk-reward strategy.

DPO-BB-MTF + Lucky Reversal MT4 Scalping Strategy

This scalping strategy combines the multi-timeframe DPO with Bollinger Bands (DPO-BB-MTF) and the Lucky Reversal indicator.

The DPO-BB-MTF shows where price is overextended relative to its recent cycle and volatility band, while Lucky Reversal marks zones likely to reverse.

Together, they help catch quick reversals or bounces for fast profits.

Intro

Best used on very short timeframes like M1, M5, or M15.

Ideal for sessions with good liquidity (London, New York). Works on major and minor pairs with tight spreads, such as EURUSD, GBPUSD, and USDJPY.

The aim is small profit targets with tight stop losses and multiple trades a day.

Buy Entry Rules

• Lucky Reversal gives a blue bullish reversal signal on the current short timeframe.
• DPO-BB-MTF is trading above the zero level, indicating a bullish trend.
• Prefer when the price is oversold in DPO and near the lower BB to increase the probability.
• Enter long at the close of the candle, showing bullish reversal (per Lucky Reversal) and confirmation from DPO-BB-MTF.
• Stop Loss: place below the reversal zone or a few pips below the lower Bollinger Band (or lower swing low).
• For M5: ~8–15 pips, for M15: ~15–25 pips, depending on volatility.
• Take Profit: set target at ~1.5:1 to 2:1 reward:risk ratio.

Sell Entry Rules

• Lucky Reversal gives a red bearish reversal signal.
• DPO-BB-MTF is trading below the zero level, indicating a bearish trend.
• Prefer when price is overbought (DPO) and near upper BB.
• Enter short at the close of a bearish reversal candle with confirmation from DPO-BB-MTF.
• Stop Loss: a few pips above the reversal zone or upper BB or recent swing high.
• For M5: ~8–15 pips, for M15: ~15–25 pips, depending on volatility.
• Take Profit: aim for 1.5-2:1 R:R.

Advantages

• Allows quick trades with tight risk and reward setups.
• DPO-BB-MTF helps identify overextension and volatility extremes; Lucky Reversal gives zones of probable reversal.
• Multiple signals per session in volatile periods.

Drawbacks

• Spread and commissions eat into profit; must use low-cost brokers.
• Requires fast discipline: exit quickly if conditions worsen.
• During news or extreme volatility, signals may fail or get whipsawed.

Example Case Study 1 — M5 EUR/USD Long

Near London open, EURUSD dropped and touched the lower DPO Bollinger Band, while trading above the zero level.

Lucky Reversal marked a blue support reversal.

A bullish candle closed confirming. Entry was taken.

Stop placed below lower BB + a few pips.

Profit target set at 2:1 R:R, reached within ~10-15 minutes. Trade yielded a clean scalp.

Example Case Study 2 — M15 USD/JPY Short

In the US session, USDJPY rose toward the upper DPO BB, while trading below the zero level.

Lucky Reversal flagged a blue reversal zone at resistance. A bearish candle closed.

Entry short taken with stop just above the resistance zone.

Target set at ~1.5:1 R:R. Price dropped back to mid-BB, took profit.

Trade managed well with low risk.

Strategy Tips

• Stick to volatile session times for better signal quality.
• Make sure spreads are low — high spreads kill scalps.
• Manage psychological risk: accept small losses and exit quickly.
• Avoid trading around big news events unless you adapt stops/larger risk allowances.

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Download the “dpo-bb-mtf-indicator.mq4” indicator for Metatrader 4

Indicator Specifications

FAQ

Can the DPO BB MTF Indicator detect breakout zones?

Yes, the combination of DPO and Bollinger Bands helps identify potential breakout zones when the price moves beyond band boundaries.

Is it effective for both short-term and long-term trading?

Yes, the multi-timeframe feature allows traders to adapt the indicator to both scalping and swing trading strategies.

Can it be combined with trend indicators?

Absolutely. Using DPO BB MTF with trend indicators like moving averages or MACD can improve signal reliability.

Does the DPO BB MTF Indicator repaint?

No, it uses historical data and calculations to ensure that signals are accurate and do not change retroactively.

Summary

The DPO BB MTF Indicator is a powerful tool for traders seeking to combine the Detrended Price Oscillator with Bollinger Bands across multiple timeframes.

Isolating short-term price cycles and identifying overbought or oversold conditions allows for more precise entry and exit points.

When used in conjunction with other indicators and proper risk management techniques, the DPO BB MTF Indicator can enhance trading strategies and improve decision-making processes.