BSI is short for Bounce Strength Indicator, and it is a Metatrader 5 indicator that displays the strength of bounce.
Following a move higher, the asset of focus is expected to move into a flat consolidation with a vivid support level.
Traders should closely monitor their charts as prices approach support level.
A sign that a bigger trend is set to continue and a consolidation breakout is imminent is put in motion when a high volume surge off a support (a scenario that is termed a springboard).
The following calculations are used in gauging the strength of bounce:
Strength of bounce up from lows;
(close – low ) * ( ceiling – low ) / range spread
Strength of bounce down from highs;
(high – close) * ( high – floor ) / range spread
The BSI Metatrader 5 indicator works better in a range bound market.
The USD/CHF M30 chart below displays the BSI Metatrader 5 forex indicator in action
Basic Trading Signals
Buy Signal: Go long when the floor bounce strength (teal histograms) of the bsi Metatrader 5 forex indicator is high i.e. the teal histograms are above the 10.00 level, and the ceiling bounce strength is very low i.e. the red histograms are hovering close or beyond the -10.00 level.
Sell Signal: Go short when the ceiling bounce strength (red histograms) of the bsi Metatrader 5 forex indicator is high i.e. the red histogram is closest to the 0.00 level, while the teal histograms are also within the same conditions.
Exit buy trade: Close all buy orders if while a bullish trend is ongoing, ceiling bounce strength (red histograms) is high i.e. the red histogram is closer the 0.00 level.
Exit sell trade: Close all sell orders if while a bearish trend is ongoing, the floor bounce strength (teal histogram) gets high i.e. the teal histograms moves above the 10.00 level.
Tips: The bsi Metatrader 5 forex indicator can transform into a leading indicator during a range breakout.
MT5 Indicator Characteristics
Currency pairs: Any
Platform: Metatrader 5
Type: chart window indicator
Customization options: Variable (Range Period, Slowing, Avg Period, Using Volume), Colors, width & Style.
Time frames: 1-Minute, 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours, 1-Day, 1-Week, 1-Month
Type: bounce | volume
Copy and paste the bsi.ex5 indicator into the MQL5 indicators folder of the Metatrader 5 trading platform.
You can access this folder from the top menu as follows:
File > Open Data Folder > MQL5 > Indicators (paste here)