Bollinger squeeze
Worked example: Bollinger-inside-Keltner release. Freeze these rules before replay, then record every eligible signal—including the ones you skip.
- CHART
- H1
- CLOCK
- UTC
- DECISION
- Completed candles only
Build the same chart
Market scope
- EUR/USD and GBP/USD H1 UTC candles; both directions.
- All bands use completed closes and at least 100 warm-up bars.
- The squeeze classifies compression only; direction comes from the price close.
Settings
- Bollinger Bands: SMA(20) of close ±2 population standard deviations.
- Keltner Channel: EMA(20) of typical price ±1.5 × Wilder ATR(20).
- Define squeeze-on when both Bollinger Bands are strictly inside the Keltner Channel for at least six consecutive completed bars; freeze the six-bar price high and low.
Check eligibility first
- At least six consecutive squeeze-on bars have completed and the frozen range predates the release bar.
- The release candle closes outside both the frozen price range and its corresponding Bollinger Band.
- Release-candle range is no greater than 2.0 × ATR(20), and displayed spread is no more than 1.5 pips.
Wait for the close
After at least six completed squeeze-on bars, freeze their price high and low. The first eligible release candle closes above both the frozen high and upper Bollinger Band, with range no more than 2.0 × ATR(20). Enter at the next H1 open.
After at least six completed squeeze-on bars, freeze their price high and low. The first eligible release candle closes below both the frozen low and lower Bollinger Band, with range no more than 2.0 × ATR(20). Enter at the next H1 open.
Stop and invalidation
Place stop at the opposite side of the frozen six-bar range. Risk 0.50% equity, rounded down to 0.01 lot.
Never widen the stop to keep a losing idea alive. Recalculate size from the actual entry-to-stop distance before entry.
No-trade filters
- Fewer than six consecutive bars have both Bollinger Bands strictly inside the Keltner Channel.
- The release does not close outside both the frozen range and corresponding Bollinger Band, or its range exceeds 2.0 × ATR(20).
- Displayed spread exceeds 1.5 pips, no release occurs within ten bars after squeeze bar six, or the next-open gap exceeds 0.50 ATR.
Choose before entry
This card's fixed method
Take profit at 2R. Exit at market after 16 completed H1 bars if unresolved.
Test separately—never mix mid-trade
- Separate variant only: bandwidth below its rolling 10th percentile instead of Bollinger-inside-Keltner.
- Separate variant only: opposite-band trailing exit.
- Separate variant only: retest entry after the release close.
Match the setup
Open a H1 chart and add Bollinger Bands(20,2), Keltner Channel(20,1.5) from Insert or Navigator with the exact inputs above. Draw required price levels before the reaction and check external filters separately. MT4 and MT5 candles use broker-server time, so verify that their H1 bar boundaries match this card's UTC candles before comparing results.
Open a H1 chart and add Bollinger Bands(20,2), Keltner Channel(20,1.5) from Insert > Indicators or Navigator. Match applied price and Wilder periods, then make decisions from completed candles only. MT4 and MT5 candles use broker-server time, so verify that their H1 bar boundaries match this card's UTC candles before comparing results.
Set the chart to H1, add Bollinger Bands(20,2), Keltner Channel(20,1.5), and match the feed and inputs. Display UTC and confirm that the selected feed uses the same H1 bar boundaries. In Bar Replay, write the decision before advancing.
Before placing a demo trade
Frozen replay costs
Use a constant 1.2-pip spread and 0.2-pip adverse slippage on each fill; zero commission and 0.5 pip per rollover crossed.
Practice template only—not a live trade signal or proof the method works. Test plenty of charts, including signals you skip.
Guided practice: https://wickatlas.com/tools/forex-trading-simulator?strategy=bollinger-squeeze&coach=1&preset=bollinger-contraction-break#guided-replay