Ehlers iTrend is a free Metatrader 4 indicator that follows the prevailing trend closely, and it provides some interesting scalping opportunities throughout the various trading sessions.
The indicator appears in the main MT4 chart window as an orange colored trend signal line.
The indicator works equally well on all assets (Forex, CFD stocks, Indices, Cryptocurrencies, Commodities,..) and shows promising results if used correctly.
Free Download
Download the “ehlers-itrend-indicator.mq4” indicator for MT4
Indicator Chart (EUR/USD H1)
The picture below shows the Ehlers iTrend MT4 indicator in action on the trading chart.
Tips:
Feel free to use your own favorite trade entry, stop loss and take profit strategy to trade with the Ehlers iTrend Forex indicator.
As always, trade in agreement with the overall trend and practice on a demo account first until you fully understand this indicator.
Please note that even the best trading indicator cannot yield a 100% win rate over long periods.
Indicator Specifications & Inputs:
Trading Platform: Developed for Metatrader 4 (MT4)
Currency pairs: Works for any pair
Time frames: Works for any time frame
Trade Style: Works for scalping, day trading and swing trading
Input Parameters: Variable (inputs tab), color settings & style
Indicator type: Trend
Does the indicator repaint? No.
Scalping Strategy: Ehlers iTrend + DSL DMI Oscillator MT4
Introduction
This scalping strategy combines the Ehlers iTrend Forex Indicator MT4 with the DSL DMI Oscillator MT4.
The Ehlers iTrend Indicator helps identify the current market trend, while the DSL DMI Oscillator provides signals based on the Directional Movement Index.
This strategy is best suited for short timeframes such as M1, M5, and M15, and is ideal for currency pairs with low spreads and high liquidity, like EUR/USD, GBP/USD, and USD/JPY.
Traders who prefer quick entries and exits with defined risk parameters will find this approach beneficial.
Buy Entry Rules
- Trend Confirmation: Ensure that the Ehlers iTrend Indicator line is rising, indicating an uptrend.
- Signal Confirmation: Wait for the DSL DMI Oscillator to cross above the zero line, signaling increasing bullish momentum.
- Entry Point: Enter a buy position at the close of the candle that confirms both indicators are aligned bullishly.
- Stop Loss: Place a stop loss just below the recent swing low or a few pips below the entry point, depending on your risk tolerance.
- Take Profit: Set a take profit target at a predefined number of pips, such as 5–10 pips, or use a risk-reward ratio of at least 1:2.
Sell Entry Rules
- Trend Confirmation: Ensure that the Ehlers iTrend Indicator is declining, indicating a downtrend.
- Signal Confirmation: Wait for the DSL DMI Oscillator to cross below the zero line, signaling increasing bearish momentum.
- Entry Point: Enter a sell position at the close of the candle that confirms both indicators are aligned bearishly.
- Stop Loss: Place a stop loss just above the recent swing high or a few pips above the entry point, depending on your risk tolerance.
- Take Profit: Set a take profit target at a predefined number of pips, such as 5–10 pips, or use a risk-reward ratio of at least 1:2.
Advantages
- Combines trend direction with momentum, increasing the probability of successful trades.
- Clear and straightforward entry and exit rules make it easy to follow.
- Suitable for high-frequency trading with quick entries and exits.
- Works well in trending markets with low spreads and high liquidity.
Drawbacks
- May produce false signals during periods of low volatility or choppy markets.
- Requires strict discipline to adhere to stop loss and take profit levels.
- Not suitable for all currency pairs; best used on those with low spreads and high liquidity.
- Frequent trading can lead to higher transaction costs.
Example Case Study 1 — EUR/USD M5
On a typical trading day, the EUR/USD pair was exhibiting a clear uptrend.
At 10:15 AM, the Ehlers iTrend Indicator was rising, confirming the uptrend.
Shortly after, the DSL DMI Oscillator crossed above the zero line, signaling increasing bullish momentum.
A buy position was entered at 1.2050, with a stop loss placed at 1.2045 and a take profit target of 1.2060.
The trade reached the take profit level within 10 minutes, yielding a 10-pip profit.
Example Case Study 2 — GBP/USD M1
During the London session, the GBP/USD pair was in a downtrend.
At 9:30 AM, the Ehlers iTrend Indicator orange line was declining, confirming the downtrend.
The DSL DMI Oscillator then crossed below the zero line, indicating increasing bearish momentum.
A sell position was entered at 1.3900, with a stop loss at 1.3905 and a take profit target of 1.3890.
The trade hit the take profit level within 5 minutes, securing a 10-pip profit.
Strategy Tips
- Trade during active market sessions like London and New York for increased volatility.
- Use a demo account to practice and refine your strategy before trading with real capital.
- Regularly review and adjust your strategy based on market conditions and performance.
- Maintain strict discipline with risk management to protect your capital.
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Download the “ehlers-itrend-indicator.mq4” indicator for Metatrader 4
