The Bollinger band indicator was created by John Bollinger (an American financial analyst and a really important contributor on the technical analysis field). Forex Bollinger Bands Support Resistance Trading System is very easy but high profitable. In the above chart market had been slowly creeping lower, indicating that the larger trend had been down, when unexpectedly a very long Bullish candlestick forms from the lower band and ends at the upper band.
When used properly, Bollinger Bands can become an important part of your overall arsenal of weapons used for Forex trading. At the third arrow, marked 3," price quickly fell into a demand zone and again, well outside the Bollinger Band. Recommended TP is as soon as you hit 10 pips or wait for when PA reaches middle of the Bollinger Band.
If you have been stopped out on two trades, it is a sign that the market is in a strong corrective phase, and taking further bounce trades off the bands is not a good idea. These are periods when the Bollinger Bands run closely together for a period before the price squeezes" out sharply in one or other direction.
For short set ups, look for inside bar/Hikkake bar to form near the upper end of the Bollinger Bands. Bollinger Bands don't repaint but if you see a large candle and a strong move, it may impact the way the previous bands look. In total, there are 22 rules that John Bollinger created when integrating Bollinger Bands as a trading system.
Like all trading systems and strategies, they have faults or weaknesses when market behaves somewhat different to the conditions they were designed to perform well in. The main disadvantage of the bollinger bands strategy with 20 period is that in a non trending market, this trading system will perform poorly.
If you follow all these conditions you can still be wrong, and thus you must place a fixed stop not too far away from entry, hiding out behind the middle band. Consequently, the confirmation came from the Stochastic oscillator, which crossed above the 20 level, thus a long position can be entered.
However, the idea regarding how to interpret Bollinger Bands indicator is the same, no matter the time frame used. As well, when price breaches a band whether upper or lower while in a state of contraction, it can be a signal of a breakout. The Bolling Bands indicator is first explained and then the Stochastic Oscillator indicator.
Hourly Chart: Above mentioned hourly chart of EURUSD gives another example of how to trade with the help of ADX and Bollinger band. Meaning, in some cases, despite a good Hikkake set up, the mid Bollinger Band is too close to entry price, which makes it worthless to take the trade.
When used properly, Bollinger Bands can become an important part of your overall arsenal of weapons used for Forex trading. At the third arrow, marked 3," price quickly fell into a demand zone and again, well outside the Bollinger Band. Recommended TP is as soon as you hit 10 pips or wait for when PA reaches middle of the Bollinger Band.
If you have been stopped out on two trades, it is a sign that the market is in a strong corrective phase, and taking further bounce trades off the bands is not a good idea. These are periods when the Bollinger Bands run closely together for a period before the price squeezes" out sharply in one or other direction.
For short set ups, look for inside bar/Hikkake bar to form near the upper end of the Bollinger Bands. Bollinger Bands don't repaint but if you see a large candle and a strong move, it may impact the way the previous bands look. In total, there are 22 rules that John Bollinger created when integrating Bollinger Bands as a trading system.
Like all trading systems and strategies, they have faults or weaknesses when market behaves somewhat different to the conditions they were designed to perform well in. The main disadvantage of the bollinger bands strategy with 20 period is that in a non trending market, this trading system will perform poorly.
If you follow all these conditions you can still be wrong, and thus you must place a fixed stop not too far away from entry, hiding out behind the middle band. Consequently, the confirmation came from the Stochastic oscillator, which crossed above the 20 level, thus a long position can be entered.
However, the idea regarding how to interpret Bollinger Bands indicator is the same, no matter the time frame used. As well, when price breaches a band whether upper or lower while in a state of contraction, it can be a signal of a breakout. The Bolling Bands indicator is first explained and then the Stochastic Oscillator indicator.
Hourly Chart: Above mentioned hourly chart of EURUSD gives another example of how to trade with the help of ADX and Bollinger band. Meaning, in some cases, despite a good Hikkake set up, the mid Bollinger Band is too close to entry price, which makes it worthless to take the trade.