Inside Bar Indicator MT4
Platform: MT4 Type: Pattern Last update: May 17, 2025The Inside Bar Indicator for MT4 performs analysis of price action and candlestick formations on chart in order to discover and reveal these classic “inside bar” patterns. They are useful for moments of market contraction, which often precede significant price moves.
Example chart:
What is inside bar pattern?
Valid inside bar pattern occurs when the current bar’s high is lower than the previous bar’s high, and the current bar’s low is higher than the previous bar’s low. Simply speaking, it’s entirely contained within the range of the previous bar (including body and wicks).
This formation reflects a period of consolidation. Sooner or later, a breakout occurs, which can provide a low-risk entry points for trades.
How to trade with the inside bar indicator for mt4?
To use this indicator effectively and get the most out of it, it’s necessary to understand the market context, developing setups and overall situation. It can be successfully used for both trend continuation and reversals at key levels.
Take a look at this USD/JPY H1 chart. It shows an ongoing downtrend. The indicator highlighted three inside bars in a trend continuation scenario. This reflects a pause or minor consolidation before resuming movement in the original direction and it is especially powerful when the mother bar is a large momentum candle.
All three of these setups provided a strong risk-to-reward ratio of at least 1:2.
This EUR/USD M15 chart shows important market levels provided by the murrey math. An inside bar pattern occured slightly below the major reversal zone defined by the red horizontal line.
The stop loss should be placed a few pips above the recent swing high. Although there were some longer wicks, they didn’t reach the sl level. After that, the price dropped significantly with awesome risk-to-reward ratio of 1:3.
Tips and hints
Follow these suggestions to increase the effectiveness when using the inside bar:
- Don’t trade every signal – keep in mind that not all inside bars are equal. Their effectiveness depends on volatility, volume, and trend strength.
- Apply volatility filters – an inside bar after a very low-volatility session might be noise. Use ATR or Bollinger Band width to filter low-probability setups.
Indicator settings
There is only one customizable parameter: “period to find inside bar“. For example, if it’s set to H1, the active time frame needs to be at least the same or lower like M15.
Conclusion
The inside bar indicator for metatrader 4 is based on a simple concept, however if paired with proper context, discipline, and market structure awareness it can give very good results. Of course, free download is available.
