113# Donchian Arrow with Confluence Tendency Forex Strategy

By Joy22 2025

The Donchian Arrow with Confluence Tendency Strategy is a trend-following trading system that leverages the Confluence 2 indicator (modified TMA band) to define the trend direction and uses the Donchian Arrow for precise entry timing. This strategy is designed for short-term trading and aims to capture high-probability trade setups with confluence signals. 

Strategy Setup

Time Frame:5-minute or higher

Markets:Any currency pairs

Platform: MetaTrader 4 (MT4)

MT4 Indicators Used:

Confluence 2 (default settings) – Defines the trend directionDonchian Arrow (default settings) – Confirms buy and sell entries Channel Signal (default settings) – Modified fractal indicator Awesome – Helps determine profit targets.

Trading Rules

General Rule:

• Always trade in the direction of the trend, as defined by the Confluence 2 indicator.

Buy Entry:

1. Wait for a buy arrow from the Confluence 2 indicator below the lower band of the channel.

2. Enter a buy trade when the Donchian Arrow buy signal appears.

3. Open the trade at the next candle’s opening price.

Sell Entry:

1. Wait for a sell arrow from the Confluence 2 indicator above the upper band of the channel.

2. Enter a sell trade when the Donchian Arrow sell signal appears.

3. Open the trade at the next candle’s opening price.

Important Consideration:

• Avoid entering trades near the opposite band of the channel to prevent low-risk-to-reward setups.

Exit Rules

Stop Loss:

• Place the stop loss at the previous swing high/low.

Profit Target:

• Use a risk-to-reward ratio between 1:1 and 1:1.3, depending on market volatility.