The Kaufman Bands MT4 forex indicator consists of Bollinger Bands and some other technical tools to generate its dotted buy and sell trend following signals.
It’s an easy to follow trend trading indicator for all kind of currency traders including scalpers, day traders and swing traders.
It plots buy and sell dots directly on the Metatrader 4 activity chart.
Blue colored dots are considered to be bullish while yellow dots are considered to be bearish.
Kaufman Bands can be traded as a standalone trend following forex indicator across all timeframes.
In order to use the indicator for the “buy on dips” and “sell on rallies” trade style, combine it with an oscillator, such as slow stochastic or RSI.
Blue dotted uptrend? Trade oversold oscillator signals and ignore overbought signals.
Yellow dotted downtrend? Trade overbought oscillator signals and ignore oversold signals.
The default indicator settings can be changed directly from the inputs tab. Feel free to experiment with its settings to suit your needs.
The EUR/USD 30-minute chart below displays the Kaufman Bands Metatrader 4 Forex indicator in action.
Basic Trading Signals
Signals from the Kaufman Bands MT4 forex indicator are easy to interpret and goes as follows:
Buy Signal: A buy signal occurs when the Kaufman Bands indicator changes color from yellow dots to blue dots.
Sell Signal: A sell signal occurs when the Kaufman Bands indicator changes color from blue dots to yellow dots.
Trade Exit: Close the open buy/sell forex position when an opposite signal occurs, or use your own method of trade exit.
MT4 Indicator Characteristics
Currency pairs: Any
Platform: Metatrader 4
Type: Chart pattern indicator
Customization options: Variable (period AMA, ngast, nslow, G, dK, Bollinger period, K_Bollinger) Colors, width & Style.
Time frames: 1-Minute, 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours, 1-Day, 1-Week, 1-Month
Copy and paste the kaufman-bands.mq4 indicator into the MQL4 indicators folder of the Metatrader 4 trading platform.
You can access this folder from the top menu as follows:
File > Open Data Folder > MQL4 > Indicators (paste here)