In summary:
By John Bollinger was Code, Bollinger is a measure of market volatility and provides a lot of useful information to combine with other tools, basic functions
- Identify key trends
- Forecasting trends continue, halt or reverse
- Consolidation Phase
- Time of volatility Breakout
- Find the bottom / top temporary
Components:
Including 3 suites: Suite MA 20 is 20 smoothed moving average trend, remaining 2 blocks role of support / resistance. In the consolidation phase, there is no clear trend, 85% of the price move within the Bands, When in Trending market, prices fluctuate abreast row above / below Bands
When uptrend, price move on the opposite row Upper Band and fell below the MA 20 and the pressure Bands are the dominant trends Reduction. If you do not catch the wave right from the start, can take advantage of the correction in the range between MA Band 20 in order to follow the trend.
Accumulation period, and 2 blocks a narrow band Upper, Lower closer together forecast Breakout session is coming, will Breakout increase / decline of 1 instruction occurs when "vegetarian bung neck button" 2 blocks U / L The maximum spacing and price breaks 1 Line. The longer time they accumulate more intense Breakout force, usually accompanied by clear trend after Breakout.
Next will come
the model M and W reversal
This is not very popular moves, suitable for swing and Scalper Trader
This type of reversal pattern occurs when:
+ Sideway trend in margin width
+ 1 Band Price break, then come back and attack Band Band middle again but failed => CREATE TOP / BOTTOM LOW / HIGH more TOP / BOTTOM before.
Specifically: Observe models W in the above illustration. Prices dropped sharply beyond the Band under, then adjust the direction of MA 20 and ultimately create higher bottom Bottom Breakout Band temporary bottom.
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