Trading with Bollinger bar.
You have already seen the technique as a powerful partner in the trading. It would be stupid not to. In addition, we then have to consider different indicators. Many in this previous article. Now I want to talk about the different indicators. – Bar – the essence of Bollinger and tell it in technical analysis.
What is the Bollinger bar.
The indicators are named in honor of the author. John Bollinger, a world-class investor who is President of the. Bollinger Manager, he also has his own Web site. You can read more about the author and his indicator bar. Bollinger
Bollinger bar is the indicator used to measure vibration fluctuation. And set the trend in the market will help you evaluate whether the price will be high. Or low, compared with the average for some time past.
Description the indicator
Bollinger bar consists of three main lines (band):
- The center line is a moving average.
- On a line with center line the same. Scroll up by having a number of standard deviations (For example, by two).
- The bottom line is the middle line, scroll down to follow the same standard deviation number.
That is, the bars on the top and bottom is the level at which rates were considered high enough or low enough compared to the average for some time past.
Since this is a general trend indicator. Bollinger bands (BB), as a rule. Do not give concrete signs of time and position. He has a completely different task: Bollinger bar seems to measure "the market." Designed to show the operators in the State. (The trend or flat) is a timely market, according to the State of the market. The traders make their own conclusions by ourselves. And enter or exit the market.
Therefore, I will not tell you the time and buy or sell it will be incorrect in my section. Just wanted to give you hints and tips on how to use. BB, some indicators.
Bollinger bar help determine the market based on the distance between the lines on. And bottom. Good distance corresponds to high volatility.
When Bollinger bar. The indicator tells us that the fluctuations of the exchange rate relatively low pair. Therefore, the trading volume is low. And as for the consolidated
Called a squeeze from a band of Vroom. Together.
The squeeze is considered a strong indication that one of the most. As a rule, this means that soon we should expect volatility and a strong trend.
The trend direction.
BB is a kind of trend indicators are trend direction. There are several ways to determine trends in the use of. BB:
- When the price between the top line moving average. There is a macro in the market between the lower line moving average. -A downtrend between top and bottom line – flat.
- By inclination, of Bollinger, one can also infer the direction of the current trend – trend is based upon tilt downwards trend downward tilted BB BB.
- If the price goes from the band. It means that the starting point, or a continuation of the trend. Therefore, one can summarize the direction of the market – while the price breakout and touch on the trend is up, while the price of cutting through the lower band down.
- If others bars on the top and bottom of the direction indicators. Indicate the current continue from the trend. And if the bars on the top and bottom taper, this may indicate a fading trend and go back.
Instructions how to use the Bollinger in Forex
- When the channel limit (total), Wait for the strong trend up or down. Remember: after a period of low volatility. Periods of high volatility. Also, the more robust channel length to subsequent movement.
- Market facilitation index recommended not using a moving average. There is a period of time less than 10 since this creates too much. It is also not advisable to set up more than two standard deviations.
- The price moves from the top to bottom and vice versa, it will attempt to return to the average of the.
- To go beyond the band, as a rule, be able to last longer than 4 bar immediately after the formation of the four-bar. It is recommended to open a position with the trend. However, this is not a reliable signal. There are often exceptions.
Therefore, the Bollinger bar indicator, it is necessary to determine the State of the market. Forex indicators are actually useful, if only in technical analysis. To get clearer signals to enter markets. BB should be used in conjunction with other indicators. Many, such as Stochastic Oscillator,MACD, RSI, etc. in a Histogram, the best way to combine them. I will tell you in the next article, hope this article is useful to you.