Last updated: May 15, 2025

Middle Band Forex Swing Trading Strategy

This is a swing strategy that is based on the Bollinger band indicator. In this indicator, there are 3 lines, and these are the upper, middle and lower band.

When the Bollinger band is going or sloping upwards, you are eyeing for a buy, and when it is going down or sloping downward, you are eyeing for a sell. Use the middle Bollinger band for buy and sell decisions.

This is useful to any timeframe especially for beginners. You can use 4-hour and above timeframe if you are a swing trader. Avoid trading when the market is squeezing or narrow because it will create false signals. You can have a good profit in this strategy when the market is trending.

Bollinger Band Settings: Period 20, deviations 2.

Trading Rules:

Buy Entry:

1. Identify the trend if it’s an uptrend.
2. The price must go back down and touches the middle band.
3. Place a buy stop order on the reversal candlestick or buy at the market price.
4. Place stop loss at the lower band line if you but at the market price and place stop loss below the low of the candlestick if you are using buy stop order.
5. Take profit when the price touches the upper band or trailing the stop by moving the stop loss behind every candlestick if the market moves in favor of your position.

Short Entry:

1. Identify the trend if it’s a downtrend.
2. The price must go back up and touches the middle band.
3. Place a sell stop order on the reversal candlestick or sell at the market price.
4. Place stop loss at the upper band line if you but at the market price and place stop loss above the high of the candlestick if you are using sell stop order.
5. Take profit when the price touches the lower band or trailing the stop by moving the stop loss behind every candlestick if the market moves in favor of your position.

Open GBPUSD 4-hour chart for the template.

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