Trend Envelopes Indicator
Platform: MT4 Type: Trend Last update: November 10, 2024The Trend Envelopes Indicator for MT4 is rated as one of the best forex trend indicators on the market and it’s available to free download. It gained recognition among traders across the world due to its very approachable and reliable signals. It’s an awesome trend filter that can be applied to any existing strategy to increase the success rate even more.
Introduction to the Trend Envelopes Indicator
As you can see, it plots the trading signals as dynamic price-following bands working in a bit similar manner to the Moving Average forex indicator.
As the general approach, price closing and holding above the envelope level is considered as the bullish trend and suggests buy trade opportunities. On the other hand, the bearish trend is valid when the price flows and holds below the signal line.
The Trend Envelope’s levels are displayed in two different colors which one should understand for basic usage. When there is a light blue Envelope line, it means an upward momentum is going on. Conversely, an orange Envelope line reflects downward momentum.
Settings
There are a few variables you can customize to fit your personal preferences and trading strategy. You can increase its sensitivity if you are a scalper, or make it less sensitive if you prefer a longer-term swing trading approach. We are referring to the MA_Period property.
How to trade with it?
Generally speaking, the signal trigger is based on the Envelope switching below and above the price. Let’s deep dive into how to exactly use that forex indicator in a few simple steps.
Buy Signal
- Envelope line turns light blue
- Price bars position is above the signal line
- Open long trade when the above conditions are met
- Set stop loss a few pips below the level defined by the band
- Take profit whenever the opposite signal appears or close it after achieving a satisfying risk-to-reward ratio
Sell Signal
- Envelope line turns orange
- Price bars position is below the signal line
- Open short trade when the above conditions are met
- Set stop loss a few pips above the level defined by the band
- Take profit whenever the opposite signal appears or close it after achieving a satisfying risk-to-reward ratio
Conclusion
The Trend Envelopes indicator is definitely worth checking out. It provides all the necessary elements for making a trade decision, including entry and exit points, trend direction, and effective stop-loss level. That forex indicator fits all kinds of currency pairs and time frames. It’s a trend-follower, therefore it generates the best results during strong market momentum conditions. Don’t forget to play with the settings as they change its responsiveness. Feel free to utilize it as a standalone trading tool or add it to any forex strategy of your choice.
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