Double Bollinger Band Breakout Rules for Forex

Summary

This strategy uses two Bollinger Band envelopes, both calculated from a 20-period simple moving average: one at two standard deviations and one at three. A long signal occurs when the ask crosses above the upper three-deviation band and price is within the two-deviation envelope. A short signal uses the corresponding lower-band cross and the same inner-envelope check.

The document specifies an OCO exit setup with stop-loss and take-profit orders each placed a configurable number of pips from entry. It provides entry and exit rules but no backtest, performance evidence, or guidance on choosing that pip distance. The description also leaves some details unclear, including how the current-price range check interacts with a band breakout and how signals are handled if prices gap across a band. Treat it as a rule outline rather than evidence of profitability.

Key ideas

• The setup uses two 20-period Bollinger Bands with two- and three-standard-deviation widths.
• A long entry requires an ask-price cross above the upper three-deviation band and a price within the two-deviation envelope.
• A short entry requires a bid-price cross below the lower three-deviation band and a price within the two-deviation envelope.
• The exit pairs a stop-loss and take-profit as OCO orders at a configurable pip distance.
• The document gives no performance results or method for selecting the exit distance.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.