Forex Sniper Entry Strategy using 200 SMA and Bollinger Bands

The specific indicators and settings for a “forex sniper” strategy may vary depending on the trader’s personal preferences and the market conditions. However, a commonly used setup for a forex sniper entry strategy is the combination of a 200 period Simple Moving Average (SMA) on the daily chart and the Bollinger Bands (BB) on the 4 hour chart. The 200 SMA is used as a long-term trend filter, while the Bollinger Bands on the 4 hour chart are used to identify short-term price movements and possible entry points.

Here are the specific indicator settings and parameters that are often used in this strategy:

  • 200 period Simple Moving Average (SMA) on the daily chart
  • Bollinger Bands (BB) on the 4 hour chart – Period: 20 – Standard deviation: 2

Traders may also use additional indicators to confirm entries, such as the Relative Strength Index (RSI) or the Moving Average Convergence Divergence (MACD) indicator with the same setup parameters.

It’s important to note that indicators are helpful tools, but it’s also important to understand market and trading concepts as well as to have discipline in following your trading plan. Also keep in mind that past performance does not guarantee future results.

When using the forex sniper entry strategy described above, the 200 period Simple Moving Average (SMA) on the daily chart is used as a long-term trend filter. If the price is above the 200 SMA, it is considered an uptrend and traders may look to enter long positions. Conversely, if the price is below the 200 SMA, it is considered a downtrend and traders may look to enter short positions.

In addition to the long-term trend filter provided by the 200 SMA, the Bollinger Bands (BB) on the 4 hour chart can be used to identify short-term price movements and possible entry points. When the price touches or moves outside the Bollinger Bands, it can indicate a potential reversal in the trend, providing a possible entry point for traders.

For example, if the price is above the 200 SMA and is currently in an uptrend, a trader may look to enter a long position when the price touches the lower Bollinger Band on the 4 hour chart. Conversely, if the price is below the 200 SMA and is currently in a downtrend, a trader may look to enter a short position when the price touches the upper Bollinger Band on the 4 hour chart.

It’s important to note that indicators are not a certain way of making profit and it’s important to use them in conjunction with a risk management and money management plan, also to understand the market conditions and the reasons why certain setups are producing certain results in the market, having discipline in following your strategy and having a clear exit plan.

Leave a Reply

Your email address will not be published. Required fields are marked *