Volatility MT4 Indicator – Free MT4 Indicator

Market volatility is something that’s really either misunderstood or not even understood at all by most retail traders. Basically, as a trader, we need to understand the market conditions in order to know what strategy to use. As a trader, we’re always looking for a volatile market (not too crazy of course) to trade because this will give us a higher chance of hitting our profit targets. When trading we need to look for trading and volatile market or ranging and volatile market and we tend to avoid trading in a quiet environment. The Volatility MT4 Indicator is created to make this aspect of trading easier for us all.

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Using the Volatility MT4 indicator we can tell whether the market is volatile or quiet at the moment and also see the instances in the past when we had periods of higher Fx volatility. The Volatility MT4 indicator shows the current and historic volatility in the form of a histogram. When we have a period of higher volatility in the market the Volatility MT4 Indicator histogram tends to raise, while when the volatility slows down the histogram declines.

The Volatility MT4 Indicator Settings

The preferred settings for the Volatility MT4 indicator are the default settings. We’re going to use a “MaPeriod” of 34 periods while for the ”value” variable we’re going to use a 0.5 period. Basically, this means that the Volatility MT4 indicator will measure the volatility of the last 34 bars based on the high-low prices.

One of its best applicabilities is that it can confirm or quite contrary it can negate a breakout. If the breakout is accompanied by high volatility it insinuates that there is real interest in the move and most likely we’re going to have range expansion in the direction of the breakout. On the other hand, if the volatility is low it can indicate that most likely we’re dealing with a false breakout and it’s better to fade the move.

The Volatility MT4 indicator can be used by the short-term trader as well as by the long-term trader because no matter of your trading style, knowing if you’re trading in an environment with high volatility or low volatility can make the difference between success and failure. Going forward, you are going to learn a unique strategy using the Volatility MT4 indicator.

Volatility MT4 Indicator Strategy and Trading Rules

The Volatility MT4 indicator cannot be used as a standalone strategy and in this regard, we’re going to use it in combination with the Stochastic Oscillator indicator another popular technical indicator used to measure momentum. The preferred time frame is the 5-minute TF since it’s a scalping strategy. Without further ado, these are Volatility MT4 strategy rules:

• Buy Signal: If the price is expending to the upside and Volatility MT4 histogram is in the upper-end zone look for buying opportunities. Wait for the Stochastic Oscillator to be in oversold condition and once the %K Line crosses above the %D Line buy at the market using a protective SL below the most recent swing low and use a static take profit of 10-15 pips;
• Sell Signal: If the price is expending to the downside and Volatility MT4 histogram is in the upper-end zone look for selling opportunities. Wait for the Stochastic Oscillator to be in overbought condition and once the %K Line crosses below the %D Line sell at the market using a protective SL above the most recent swing high and use a static take profit of 10-15 pips;

Volatility MT4 Indicator Trade Example

In the above chart, we have the EUR/USD 5-minute chart and a short trading opportunity is highlighted. Only after all conditions for a trade are met only then a trade can be initiated. This will make sure that the market is really in a strong trend and only once the volatility is high enough, which ensures that we’re going to have enough profit margin to have a profitable trade.

Volatility MT4 Indicator – Recommended Time Frames

Technically speaking, you can use this MT4 indicator for all time frames. However, the shorter the time frame, you will see more fluctuation and possibly more whipsaw which may cause small losses that can eat up your portfolio quickly. We recommend that you use higher time frames like the 4H for better consistency.

Volatility MT4 System Indicator Download

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Leave us a comment below to let us know your thoughts on this indicator. If you like this indicator, you might like see other indicators that we have carefully selected that will help you in your trading journey.

And if you can, you really should invest in a proven MT4 Expert Advisor to help you generate some profit on full autopilot. We highly recommend this powerful MT4 Expert Advisor.

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