About the Envelopes Toucher Indicator
The Envelopes Toucher indicator for MetaTrader 4 is a free tool designed to spot potential trend reversals by tracking price interactions with envelope bands.
Colored yellow and blue channels are plotted directly on the main MT4 chart, making it easy to visualize market direction.
The indicator generates trade signals using small white dots below the lower band for buy opportunities, and small magenta dots above the upper band for sell opportunities.
This setup provides multiple daily trade chances, ideal for scalpers and day traders.
By observing these signals, traders can better anticipate short-term trend changes and optimize trade entries.
Free Download
Download the “envelopes-toucher-indicator.mq4” indicator for MT4
Key Features
- Displays trend reversal signals on the MT4 chart
- Uses colored envelope channels for visual trend guidance
- White dots indicate potential buys, magenta dots indicate potential sells
- Effective for scalping and intraday trading
- Compatible with all currency pairs and timeframes
- Can be combined with momentum or trend indicators for confirmation
Indicator Chart
The chart below shows the Envelopes Toucher indicator in action.
White dots below the lower band signal buy opportunities, while magenta dots above the upper band signal sell opportunities.
The colored envelope channels help identify the current trend direction and potential reversal zones.
Guide to Trade with Envelopes Toucher Indicator
Buy Rules
- A white dot appears below the lower envelope band
- Confirm that price respects the trend or bounce off the band
- Prefer trading during London and New York sessions for higher volatility
Sell Rules
- A magenta dot appears above the upper envelope band
- Confirm that price respects the trend or reversal setup
- Prefer trading during active trading sessions
Stop Loss
- Place a stop slightly beyond the envelope band
- Adjust stops for high-volatility sessions to avoid premature exits
Take Profit
- Target 1.5–2 times the stop loss distance
- Consider exiting partially when the opposite color dot appears
- Adjust the take profit based on session strength and momentum
MT4 Scalping Strategy: Envelopes Toucher & Awesome Oscillator
This scalping strategy combines the Envelopes Toucher and Awesome Oscillator indicators for MT4 to identify precise entry points in the forex market.
Designed for short-term traders, it aims to capitalize on quick price movements by providing clear buy and sell signals.
The strategy is particularly effective on lower timeframes such as M1, M5, and M15, making it suitable for active day traders and scalpers.
Buy Entry Rules
- Look for the candlestick to cross back above the Envelopes Toucher blue line from below.
- Confirm that the Awesome Oscillator shows positive histogram bars, reflecting upward momentum.
- Enter a buy trade once both indicators align and the price closes above the recent local resistance.
- Place the stop loss a few pips below the nearest swing low to manage risk effectively.
- Set a take profit level at twice the risk distance, or exit when the Awesome Oscillator starts to show declining bullish momentum.
Sell Entry Rules
- Wait for the candlestick to cross back below the Envelopes Toucher orange line from above.
- Ensure the Awesome Oscillator shows negative histogram bars to confirm downward momentum.
- Enter a sell trade when both indicators confirm and the price closes below the recent local support.
- Place the stop loss a few pips above the nearest swing high to protect against sudden reversals.
- Set a take profit target at twice the risk distance, or close the trade if the Awesome Oscillator starts to lose bearish strength.
Advantages
- Works well in trending markets by filtering out minor market noise.
- Allows for multiple trades per day due to clear entry and exit points.
- Helps identify momentum changes quickly for timely scalping decisions.
- Can be combined with other indicators or price action strategies for added confirmation.
Drawbacks
- May produce false signals during periods of low volatility or ranging markets.
- New traders may find it challenging to interpret signals without proper practice.
Case Study 1
On a 5-minute EUR/USD chart, the price moved back above the Envelopes Toucher blue line from below.
The Awesome Oscillator confirmed the buy signal with positive histogram bars.
The trader entered a buy position with a stop loss below the recent swing low and a take profit target at twice the risk.
The trade was successful, yielding a profit as the price moved in the anticipated direction.
Case Study 2
On a 15-minute GBP/USD chart, the price moved back below the Envelopes Toucher orange line from above.
The Awesome Oscillator aligned with the sell signal, displaying negative histogram bars.
The trader entered a sell position with a stop loss above the recent swing high and a take profit target at twice the risk.
The trade was profitable as the market continued its downward trend.
Download Now
Download the “envelopes-toucher-indicator.mq4” indicator for Metatrader 4
FAQ
How does Envelopes Toucher generate signals?
It monitors price closing levels relative to the envelope bands. White dots below the lower band indicate potential buys, and magenta dots above the upper band indicate potential sells.
Which timeframes are recommended?
It works on all timeframes, but M5–H1 are ideal for scalping, while H4–D1 can be used for intraday or swing setups.
Can it be combined with other indicators?
Yes, using trend or momentum indicators alongside Envelopes Toucher can improve trade confirmation and reduce false signals.
Is it suitable for all currency pairs?
Yes, it works on major, minor, and exotic pairs, offering multiple daily trading opportunities.
Summary
The Envelopes Toucher indicator is an easy-to-use MT4 tool for identifying trend reversals.
Its colored envelope bands and signal dots provide clear guidance for buy and sell opportunities throughout the trading day.
By combining these signals with proper stop loss and take profit rules, traders can develop a consistent scalping or intraday strategy suitable for a wide range of currency pairs.
