The Bellcurve Strategy
Consistent and well-proven trading strategy. Our Bellcurve trading strategy works in any market and timeframe.
Examples
The Bellcurve strategy is all about finding reversals around key levels/zones. On this page, we gonna share some example trades.
Make sure that you understand the strategy!
It’s all about finding significant market impulses
The importance of market Impulses
In this example, we can clearly see that the Bellcurves can be used to confirm when a market impulse is about to stall. If that happens around a key level of support/resistance it’s a high chance of a reversal.
Keep it that simple! Use the Bellcurves to confirm key levels/zones
In this example, we can clearly see that the Bellcurves can be used to confirm when a market impulse is about to stall. If that happens around a key level of support/resistance it’s a high chance of a reversal.
Keep it that simple! Use the Bellcurves to confirm key levels/zones
Based on real-trades
Example #1
1) Map the Demand Zone! This is a demand zone because the price made a significant price move from this level.
2) Price makes a rapid/significant negative impulse that broke the previous wick. Initiates liquidations.
3) The Bellcurve confirms that the previous demand zone has a high chance of being respected, hence we look for a long entry around this level.
Important to understand!
3 aspects to keep in mind!
Key Levels/Zones
Map Key Levels/Zones from higher timeframes!
The simplest way to find key levels/zones
1) Day Open
2) Previous Day Close
3) Previous Day Open
4) Week Open
5) Previous Week Close
6) Previous Week Open
Significant price move
Price has to make a significant price move that triggers fear/greed in the market. We have to see some sort of liquidations and abnormal price moves. It’s about getting a volatility move!
Size of the Bellcurve
The Size of the Bellcurve is a measure of the impulse strength. We want to see a huge Bellcurve that is relatively bigger than the previous ones. Indicating a significant price move and great volatility!
Based on real-trades
Example #2 – Liquidity Trade
Be able to identify liquidity runs/grab is a key skill to master in trading. It requires some practice but once you get the hang of it you will only take trades in these areas.
In this example, (1- hour chart) we can clearly see that FDAX has previously been in a range. The price broke up on Thursday and touched the week’s open level initiating selling pressure.
On Friday the price opened around 15 500 which coincided with the previous lower range. The lower range can be seen as a support level and the price could potentially reverse.
Why did price break the support level?
1) One major factor – the lower range has already been tested 4 times, the more a level is tested the more likely is it that we break it.
2) When a range level breaks it will definitely trigger liquidations hence big players can get the size they want without impacting the price movements that much.
3) In this case, we got 2 nice wicks around 15 450 – 15 420 that have never been tested before. Fresh levels (not tested before) are absolutely amazing places to enter trades at. Especially when liquidation occurs.
- So this vacuum from the lower range (around 15 500) to the wicks 15 450 – 15 420 – is a source for liquidity! High volume and great volatility will occur!
- Look for entries around these wicks! However, be aware of high volatility and you may experience some drawdown before the price eventually takes off!
- If you’re unsure whether a reversal will come or not, wait for a re-test of the level. A good sign that the price will respect the level and take off is if the re-test occurs with declining momentum or with a divergence.
Use the Bellcurve to confirm that the level is going to be respected!
The momentum was clearly declining and a nice Negative Bellcurve was formed in the 5 min chart. Round number 15 450 and liquidity was purged
Example #3 – Short Trade
1- hour Chart
1) Week Open & the first hour of the Day — Assume Higher volatility
2) Price in Upper Range (Key Level of Resistance, the price has reacted around this Zone before and has made significant price moves). + a Positive Bellcurve in the 1-hour chart!
3) Pop over to the 1 min chart and look at the Positive Bellcurve that can confirm a Short entry at this level
Scalping profit around Day Open + round number 15 650 (almost 100 pips)
Using levels/zone from a higher timeframe and confirming these levels/zone in lower timeframes has been a consistent winning strategy for me
Example #4
A few factors for this Long Entry.
We previously had a solid breakout from the support zone, once it happens price will make a huge move. These days, it is always better to be patient and wait for a support level derived from higher timeframes. Once a breakout happens, ignore all Bellcurves until we reach a key level.
1) Price was down around 230 pips once we reached the zone 15 350 – 15 300, a pullback or reaction has to happen, it will most likely happen after such a move.
2) Price reach a level of support + (Most important) >> that very last impulse was significant relative to how the price was trending down. This Negative impulse was “faster” and was about 50 pips in some minutes. Telling me that we most likely had liquidations at this point.
3) I had the confirmation needed to enter long at this point.
Example #4
A few factors for this Long Entry.
We previously had a solid breakout from the support zone, once it happens price will make a huge move. These days, it is always better to be patient and wait for a support level derived from higher timeframes. Once a breakout happens, ignore all Bellcurves until we reach a key level.
1) Price was down around 230 pips once we reached the zone 15 350 – 15 300, a pullback or reaction has to happen, it will most likely happen after such a move.
2) Price reach a level of support + (Most important) >> that very last impulse was significant relative to how the price was trending down. This Negative impulse was “faster” and was about 50 pips in some minutes. Telling me that we most likely had liquidations at this point.
3) I had the confirmation needed to enter long at this point.
Example #5 – Day Open
Price drops back down to Day Open, previous Demand (short-term demand zone).
The drop itself has no structure, which often can lead to an equal movement in the opposite direction.
The BellCurve gave me the confirmation needed.
Example #7 – Using Reversal Bands & Zones (Expo) & Get started with Key Levels
Get Started with “key levels”
I know that some users struggle with knowing what a key level/zone is, and I know by experience that it takes time to learn how to identify high-probability levels/zone. It’s subjective and based on experience many times.
To get everyone started I would like to propose the most simple thing that everyone can keep track of and requires no experience to identify, namely, keep track of:
Daily Open
Previous Daily Open & Daily Close
Mark these levels manually on the chart, and try to find confluence and confirm trades around these levels.
Example In the graph below I share a potential confirmation method to the Bellcurve using the Reversal Bands & Zones indicator.
1) Price drops and breaks under the lower band indicating oversold. (In this case, we also broke under round number 15 500 – triggering additional liquidations).
2) Bellcurve was formed + price under the lower Reversal Cloud
3) Price comes back down to around yesterday’s daily close (Which is our key zone in this case)
4) We have the confirmation needed to enter long
Example #8 – Liquidity & Round Number
The first graph is showing the 1-hour chart of DAX. We can clearly see that the Index is in a Range. We can identify that price has tested 15 520 several times and significant price moves have come when the price has been tested 15 450 (See the wicks).
The Zone between 15 520 – 15 450 is a liquidity zone, hence we want to look for entries in this area.
The reasoning for this Trade:
At US open we got a rapid price drop, with high volatility, the price reached round number and DAX was already down some pips for the day, and if we look at the 1-hour chart we can clearly see that we broke down from previous support, a liquidity grab and we saw a potential fakeout move to catch.
The Key:
The key for this trade is that we reached the liquidity zone during the first 1 hour of the US open with a rapid impulse. High volatility!
Example #8 – Liquidity & Round Number
The first graph is showing the 1-hour chart of DAX. We can clearly see that the Index is in a Range. We can identify that price has tested 15 520 several times and significant price moves have come when the price has been tested 15 450 (See the wicks).
The Zone between 15 520 – 15 450 is a liquidity zone, hence we want to look for entries in this area.
The reasoning for this Trade:
At US open we got a rapid price drop, with high volatility, the price reached round number and DAX was already down some pips for the day, and if we look at the 1-hour chart we can clearly see that we broke down from previous support, a liquidity grab and we saw a potential fakeout move to catch.
The Key:
The key for this trade is that we reached the liquidity zone during the first 1 hour of the US open with a rapid impulse. High volatility!
Example #9 – Yesterday’s Close
DAX re-tested yesterday’s Close, within the first hour of the day. Yesterday’s Close can be a good area to look for reversals. A simple level that we always should keep track of.
Price broke round number 15 750 which always triggers some liquidations. That is what we want to see (rapid impulses around levels).
A well-formed BellCurve in the 5 min chart gave me the confirmation needed to enter long.
Try this strategy out! Remember: It’s all about confirming and to find confluence around Key levels/zones
Give it a spin!
We encourage everyone to play around with the Bellcurves and find combinations and methods that work for you.