Volatility Step Channel Indicator is a trend-following forex trading indicator, used to identify the market trends based on the price volatility. The idea behind the development of this indicator is to create a strategy that follows the market trend and respects the price volatility at the same time. This strategy worked well and intends to supply quality trade signals.
Volatility Step Channel Indicator offers great simplicity in trading since it uses a very simple technique for demonstrating the trade signals. Moreover, it suits all sorts of timeframe charts and can be applied to trade all kinds of forex currency pairs in the market.
Volatility Step Channel Indicator Overview
Download and install the Indicator at your MT4 platform. Once you’re done, your trading chart will appear like the image below
Also Read: Best Forex Trading Strategy
Volatility Step Channel Indicator Explanation
Volatility Step Indicator uses a Volatility Step Channel that gives you the scenario of the current market trend. On the other hand, the Base Volatility shows you if the current market movement is supported by the price volatility index or not. For example, if the market is in a bullish mode, the Base Volatility should also be in an uprising trend for the confirmation of going long. Furthermore, you can use Volatility Step Channel for determining the dynamic stop level of the current market trend.
Volatility Step: Buy Conditions
- Price breaks above the Volatility Step Channel
- Base Volatility is in a rising pattern
- Activate the buy entry after the above conditions are met
- Set stop loss below the Volatility Step Channel
- Exit long/take profit whenever price breaks below the mid-band of Volatility Step Channel
Volatility Step: Sell Conditions
- Price breaks below the Volatility Step Channel
- Base Volatility is in a falling pattern
- Activate the sell entry after the above conditions are met
- Set stop loss above the Volatility Step Channel
- Exit short/take profit whenever price breaks above the mid-band of Volatility Step Channel