Learn Four Powerful Bollinger Band Trading Strategies

Hi, guys hello everybody this is Gary here hope you’re, well, I am first of all excited to present today and the reason been that we have reached 1000 subscribers on this channel hooray, well, it is only 1000, but you know what I am most grateful for that and as, well, I appreciate and cherished every subscriber on this channel thank you, so much thank you, so much I thought it would be good to actually introduce myself to you and show my face on the screen this is me here my name is dari a jade with me dari a jag with me I am of African background today however we are going to talk about Belinda band okay we will talk what is Bollinger Band the purpose the calculations what is the squeeze of Bollinger Band the break out and finally we talk about four strategies to trade using Bollinger Band at the end of this presentation today you will be able to look at a chart and identify some key turning points and opportunity to trade using Bollinger Band what is Bollinger Band, so here is the s packs his name is John Bollinger he is the S box he is the auto he designed formulate correct this indicator, so whatever you want to know dip into this indicator here is your man he has a website where you can learn more, but today I will try to describe what it is and how to use it successfully in the indicator as we said is developed by John Bollinger it is actually a volatility balance placed above and below a moving average, so the volatility is based on standard deviation which changes as volatility increases or decreases, so this band automatically widen when with little volatility increases and narrow when volatility decreases, so this dynamic nature of Bollinger Band also means that they can be used on different instrument with the standard setting, so in summary Bollinger Band is the plotting of two standard deviations away from a simple moving average the middle is a simple moving average the top band is a standard deviation above and the lower band is standard deviation below what actually is the purpose of having a Bollinger Band the main purpose of Bollinger Band is to provide and proportionate definition of high and low by definition prices are high when the ads appa land prices are low when they are lower band the average price is at the middle band, so we know when you are going to the shops you want to find you item all the place you can get it the best lowest price for the same item, so the function of Bollinger Band is to help you identify when prices are low and when prices are high, so how do you calculate Bollinger Band, so we start from the middle the middle is the 20-day moving average simple moving average basically 20s MA and the top is just that same 20 moving average you add to standard deviation of that moving average to reach same thing with the lower band is the same 20-day moving average, but you subtract from it to standard deviation of the moving average you subtract form the 20-day moving average, so that is the standard settings default settings of Bollinger Bands do not worry about how to calculate it, because most of the trading platform has already done that for you mg for tradestation are many more, if already done all the calculations Bollinger Band squeeze, so what exactly is the Bollinger Band squeeze it is the central concept of Bollinger Band when the band come close together when they come close together compressing the moving average it is called a squeeze, so a squeeze signal a period of low volatility and it’s considered by traders to be a potential sign of future increase in volatility and possible trading opportunity, so conversely the wider apart when these things are, so wide apart the more likely the chance of a decrease in volatility and the greater possibility of exiting any trade that you are in this balance actually gives no indication when the change may take place or which direction, so the band tells you something will happen, because it’s closing together is squeezing together, but they will not tell you what direction it will go down or up the breakouts approximately 90% of price actions or call between the upper and lower Bollinger Band the upper and the lower Bollinger Bands any breakout like this one above or below the band is a major event the breakout is not a trading signal, so the mistake most people make is believing that the price hitting or exceeding one of the bands is a signal to buy or to sell breaker provide no clue as to the direction and extent of feature price movement, so you see prices breakout over there you don’t actually know yet how long the breakout we last okay, now we come to the meaty part of our discussion today the strategies, so as I said earlier we have four strategies for you to the air for strategy for you today number one strategies is inside band trading firstly to use this strategy you need to find a Forex pair that is in trading range trading range it has to be in a range you can use any timeframe the greater the range the better in this example this pair is actually in a range as you can see from the this point as soon as a price go out of the one they simply come back when you go out of the band is simply come back when they go out of the band, so the price are confined within the band that’s what is called range, so, if you find such a pair, then these are the opportunities for you, so you just buy when price test the low end of the range and they look at the lower band conversely you sell when prices state test the high of the range and the upper band, so here prices are testing the upper band that prices are testing the lower band, so when they test the lower band you will buy when they test the upper band you will sell, so, because they are in range you can do the two directions together buy and sell it once it reaches the range, so for a conservative person, if you buy at this lower band here you exit in the middle however for a an aggressive trader they will exit art the upper band, so opportunity again to buy and to exit here or a CD depending on your trading pattern here supposing to short the market a sit here short here and sit here by the market a CTA by the market has it a sell the market has it there, so just on this screen you have seven trading opportunity which are all successful okay, so the key to it is you must find a pair that is in a range you cannot use this strategy during breakout second strategy the pull back to the middle pull back to the middle the key to this particular strategy is that you have to wait on a test of the middle line test of the middle line before entering the position after a strong up move or dumb move, so when they say strong op move and as a pullback to test the middle line that’s a signal to go long, so that’s up move and let’s a pullback buy up move pull back buy up move pull back by op move pull back by, so this are, so there are three buy an opportunity here one two three and you can exit them at the exit at the end the opposite end of the channel the upper band, so as I said this the key is the way to test the middle band, so you can increase your likelihood of placing a winning trade, if you go in the direction of the primary trend place go in the direction of the primary trend you can see primary strain is up, so you have to go in the rationale the primary trend which is buy buy buy I know that our opportunity to sell here and sell there however this is selling is not in the direction of the main trend, so avoid going against the main trend remember the trend is what is your friend third strategy soften with the band soften with the band, so breaking the band occurred during times of extreme volatility and is the strongest signal issued by Bollinger Bands that a trend reversal is imminent as we mentioned earlier prices are within this band about 90% of the time therefore prices you only break above here only about 10% of the time when you were using the to standard deviation in our example we notice the tightening of the Bollinger Bands right before the breakout that’s a big tightening here before they break out, so the middle line which is the middle Bollinger Band can actually represent a support on a pullback when the pair is riding or softened band, so when there’s a pullback to this middle line is an opportunity for you to add to the opposition in a very strong trend it will not even reach this middle band, if we just hug this upper man or, if it’s a downtrend, if we just follow and right on the lower band okay last, but not the least of our strategies today is the Bollinger Band reverser the Bollinger Band Levasseur, so what is the Bollinger Band reverser, so you can take a short position when you see a fake breakout leading to reverser, so that’s a fake breakout it leads to a reverser you can shot here similarly here that’s a fake break out and reverser you can shot fake breakout reverser you can shot and exit your position and the lower band, if you are aggressive a city opposition at middle band, if you are conservative, so guys this is for strong strategies that is been tested and is being used in various markets in for X in stocks in futures market are many many more guys usually people will still have one or two more indicators in order to confirm some of these signals, so, if you have under indicators that can help to confirm when there is a signal that will be helpful, so Bollinger Band himself as written 22 rules, so it is the rule that he has compiled, so I will briefly show you the rules, so he has compiled this rules Bollinger Band rules, so there are 22 in numbers want you and, so on and, so forth there are 22 in numbers they are very useful rules compiled by the author himself, so this is the work of the Otto it’s not my work in the work of the Otto, so, if you, if you need this rule, if you need to go through this rule you have two options you can go straight to ease websites and read it over there, but I’ve put it in a PDF for you, if you are interested I can email to you just as usual comment and add your email address in the comment session and ask for the e-book that is the 22 rules of Bollinger Band trading politia band trading rules and I will email it to you for free, so once again guys thank you for your support I am really looking forward to the next video, so guys I’m signing off again.

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