Strategy on the Bollinger Bands BB Gann System

BB Gann System strategy is based on Bollinger Bands and the Gann_HiLo indicator. It should be noted that the strategy is not 100% mechanistic, and some trades are opened at the trader's discretion.

Input parameters

• Currency pairs: The strategy performed best on pound currencies, as well as on highly volatile pairs like EUR/AUD.
• Timeframe: testing was conducted on the timeframe H4 (probably on other TF strategy will also work, but the testing was not carried out).
• Bidding time: any.
• Risk Management: After calculating the stop-loss, choose such a volume of the lot that the risk was not more than 2-5% of the deposit per trade.

Installing the BB Gann System Indicators and Strategy Template

• Unpack the archive with templates and indicators.
• Copy the indicators to the folder MQL4 -> indicators.
• Copy the templates into the templates folder.
• Restart the terminal.
• Open the chart of the desired currency pair.
• Install the template with the name BBGann.

The schedule should look like this:

Signals indicating the opening of a long position (buying)

1. Stochastic oscillator moved from a sell zone to a buy zone (that is, from level 25 to level 75; even better, if the transition occurred from level 15 to level 85; the smoother and sharper the transition, the better).

2а. CCI 34 indicator left oversold area and headed to the middle level (i.e., crossed the lower level from the bottom to the top). At least one peak must be present before this trough.

2b. The CCI 34 indicator has left the middle level and is in the overbought zone (i.e., crossed the upper level from bottom to top). There should be at least one peak before this one (which indicates an ongoing uptrend).

Note: if a signal 2b occurred, then usually on the graph is strong upward trend. As a rule, the price is near the upper Bollinger Band, which contradicts Rule 3. In this case, you should wait for a pullback before entering the trade. Also the price should not be far from the moving average. Otherwise the trend can slow down and even reverse, at least to the support level, which is represented by the moving average.

3. Price has crossed the middle line of the Bollinger Bands downwards or is at it (if other conditions are met, there must be at least some space between price and the top Bollinger level, although this rule can be violated when the Bands are too close together).

4. The price has not broken through the upper Bollinger level (again, this rule may be violated if the range is too narrow).

5. The indicator Gann Hilo (blue line) is below the price.

Signals indicating the opening of a short position (sale)

1. The stochastic oscillator has moved from a buy zone to a sell zone.

2а. CCI 34 indicator left overbought area and headed to the midpoint (that is, crossed the upper level from bottom to top). There must be at least one trough before this peak.

2b. The CCI 34 indicator has left the middle level and is in the oversold zone (i.e., crossed the bottom level downwards). There should be at least one trough in front of this one (indicating an ongoing downtrend).

Note: if the signal 2b occurred, then usually there is a strong downtrend on the chart. As a rule, the price is near the lower Bollinger Band, which contradicts the rule 3. In this case you should wait for a pullback before entering the trade. Also the price should not be far from the moving average. Otherwise the trend can slow down and even reverse, at least to the resistance level, which is moving average.

3. The price has crossed the middle line of the Bollinger Bands from top to bottom or is at it.

4. The price has not broken through the lower Bollinger level (the rule may be violated if the range is too narrow; see Buy rules).

5. The indicator Gann Hilo (blue line) is above the price.

The moving average (red bold line) is intended for:

• Identification of the trend direction (for example, if the CCI indicator has several consecutive peaks, stochastics fluctuate in the buy zone, the price is above the Gann HiLo indicator and the red moving average, the trend is most likely upward; otherwise it is downward)
• Stop Loss and Take Profit settings.
• Definition of support/resistance levels.
• In fact, two schemes of operation are possible. The first scheme uses conditions 1, 2a, 3, 4, 5; the second uses conditions 1, 2b, 3, 4, 5 (the difference is only in conditions 2a and 2b).

Stop and Take strategy

• Fractal method: the stop is set just below the nearest fractal down (if we buy) or slightly above the nearest fractal up (if we sell). Take Profit is set equal to the size of the stop.
• Based on the Bollinger Bands: lower extremum - stop, upper extremum - take (if buy), upper extremum - stop, lower extremum - take (if sell).
• Combination of fractals and bands: fractal down - stop, upper band - take (if buy), fractal up - stop, lower band - take (if sell). Usually the ratio of risk to profit is less than one.
• Combination of bands and fractals: lower band - stop, fractal up - take (if buy), upper band - stop, fractal down - take (if sell). The ratio of risk to profit is usually greater than one.
• According to the moving average: the stop is set on the fractal or band, and the take - on the moving average. This option is especially worth considering if price has already pulled away from the moving average once.

It is recommended to set a take and stop based on the Bollinger Bands, because this indicator adjusts to the market. It is advisable to leave the stop intact (or move it to reduce risk), and to move the take in accordance with the movement of the band (increasing or decreasing the possible profit).

Download template and indicators of the BB Gann System strategy

Other strategies using Bollinger Bands