About the Engulfing Bar Alert Indicator
Engulfing Bar Alert is a price action Forex indicator designed for MetaTrader 4 that scans the market for bullish and bearish engulfing patterns.
These patterns are widely used by traders to identify potential reversals and continuation opportunities.
The indicator automatically detects these formations and displays them directly on the chart.
When a valid engulfing pattern is found, the indicator plots a colored arrow to mark the signal.
Blue arrows represent bullish engulfing setups, while magenta arrows highlight bearish engulfing conditions.
This visual approach allows traders to react quickly without manually scanning every candle.
Engulfing Bar Alert is highly versatile and can be applied across different trading styles.
It works well as a standalone price action tool or as a confirmation indicator within a broader trend-based strategy.
With adjustable inputs, traders can customize how strict or flexible the pattern detection should be.
Free Download
Download the “engulfing-bar-alert-indicator.ex4” MT4 indicator
Key Features
- Automatically detects bullish and bearish engulfing patterns.
- Displays signals as colored arrows on the chart.
- Based purely on price action logic.
- Fully customizable through the inputs tab.
- Works on all MT4 timeframes and instruments.
- Ideal for traders focused on candlestick patterns.
Indicator Chart
The chart below shows the Engulfing Bar Alert indicator applied to a Forex price chart.
Blue arrows highlight bullish engulfing patterns during upward market phases.
Magenta arrows mark bearish engulfing patterns during downward price movement.
Guide to Trade with Engulfing Bar Alert
Buy Rules
- Confirm that the overall market trend is moving upward.
- Wait for a blue engulfing arrow to appear on the chart.
- Enter a buy trade at the close of the engulfing candle.
Sell Rules
- Confirm that the overall market trend is moving downward.
- Wait for a magenta engulfing arrow to appear on the chart.
- Enter a sell trade at the close of the engulfing candle.
Stop Loss
- Place a stop loss below the nearest support level for buy trades.
- Place a stop loss above the nearest resistance level for sell trades.
Take Profit
- Target a minimum fixed profit such as 10 pips.
- Extend the take profit toward the next support or resistance zone.
Engulfing Bar Alert + LSMA Trend MT4 Scalping Strategy
This strategy uses the Engulfing Bar Alert Indicator for MT4 and the LSMA Trend Forex Indicator for MT4 to capture quick price movements on short timeframes.
The Engulfing Bar Alert shows blue arrows for buy signals and magenta arrows for sell signals.
The LSMA Trend line confirms trend direction with green for bullish and red for bearish conditions.
This combination works well on M1, M5, and M15 charts.
The strategy focuses on entering trades in the direction of the trend while using the engulfing bar signals for precise entries.
This approach is suitable for scalpers who want fast, clear setups with defined risk and reward levels.
Buy Entry Rules
- Ensure the LSMA Trend line is green, indicating a bullish trend.
- Wait for a blue arrow to appear from the Engulfing Bar Alert indicator.
- Enter a buy trade at the close of the candle with the blue arrow.
- Set a stop loss just below the low of the engulfing candle or recent swing low.
- Take profit at a small pip target (e.g., 5–15 pips on M5) or exit when the LSMA line turns red or a magenta arrow appears.
Sell Entry Rules
- Ensure the LSMA Trend line is red, indicating a bearish trend.
- Wait for a magenta arrow to appear from the Engulfing Bar Alert indicator.
- Enter a sell trade at the close of the candle with the magenta arrow.
- Set a stop loss just above the high of the engulfing candle or recent swing high.
- Take profit at a small pip target or exit when the LSMA line turns green or a blue arrow appears.
Advantages
- Simple visual entries and trend confirmation.
- Works effectively for scalping on short timeframes.
- Helps avoid random trades by confirming trend direction.
Drawbacks
- The LSMA line can lag slightly, causing delayed trend confirmation.
- Requires fast decision-making and strict risk control for M1/M5 scalping.
Case Study 1 – USD/JPY (M5 Chart)
During the Asian-London overlap on USD/JPY, the LSMA Trend line was green.
The Engulfing Bar Alert displayed a blue arrow at 149.30.
A buy trade was opened at 149.30 with a stop loss at 149.22.
The price moved to 149.40 within 10 minutes for a +10 pip profit, capturing a short intraday retracement.
Case Study 2 – EUR/GBP (M1 Chart)
On the EUR/GBP M1 chart, the LSMA Trend line was red.
A magenta arrow appeared from the Engulfing Bar Alert at 0.8605.
A sell trade was opened at 0.8604 with a stop loss at 0.8611.
Price fell to 0.8595 within a few minutes, generating +9 pips.
The setup captured a rapid intraday reversal effectively.
Strategy Tips
- Focus on high-liquidity pairs like EUR/USD, GBP/USD, USD/JPY, and EUR/JPY for faster reaction.
- On M1, use smaller position sizes and tighter stops; on M15, slightly larger stops and targets are acceptable.
- Trade only when the LSMA line is clearly green or red and not flat or changing frequently.
- Keep risk per trade low (1–2% of account) and monitor scalping performance over time.
Download Now
Download the “engulfing-bar-alert-indicator.ex4” MT4 indicator
FAQ
Does the Engulfing Bar Alert repaint signals?
Signals are generated after a candle closes.
Once an arrow appears, it remains on the chart and does not change.
Can this indicator be used on lower timeframes?
Yes, it works on all timeframes.
Lower timeframes generate more signals, so additional filtering may be useful.
Is trend confirmation required?
Trend confirmation is recommended.
Engulfing patterns aligned with trend direction generally perform better.
Can the arrow colors be changed?
Yes, the indicator inputs allow full customization, including arrow appearance and sensitivity.
Summary
Engulfing Bar Alert is a focused MT4 indicator built for traders who rely on candlestick price action.
Its arrow-based signals make bullish and bearish engulfing patterns easy to spot in real time.
This helps reduce analysis time and improves execution speed.
The indicator is flexible, customizable, and effective across different market conditions.
With proper trend filtering and risk management, it can become a strong component of a pattern-based trading strategy.
For traders who value clean price action signals, the Engulfing Bar Alert is a solid addition to the toolkit.
