How to use Bollinger Bands correctly

The Bollinger Bands indicator is divided into high lines, median lines, and low lines. The high line of the Bollinger Bands can be used as a reference for the resistance level, while the low line can be used as a reference for the support range. Under normal circumstances, when the three lines of the Bollinger Bands indicator are in a downward trend, and the stock price is running between the median line and the low line, it means that the stock price is in the ** trend.

When the three lines of the Bollinger Bands indicator are in an upward trend, and the stock price is running between the median line and the high line, it means that the stock price is in the ** trend.

As long as the application of Bollinger Bands is mentioned in many books, these two sentences are indispensable: the stock price crosses the support line upwards as a signal, and the stock price crosses the resistance line downwards as a sell signal. Is that really the case?

As long as you open the software, you will find that if you determine the ** signal in this way, it is full of buying points during the entire downward adjustment process of the stock index, which is very unreliable. The following points should be paid attention to when applying Bollinger Bands in weak markets:

1. The stock price cannot cross the support line upwards as a signal, but the lowest price line crossing the lower band of the Bollinger Bands should be used as a signal to pay preliminary attention to the stock.

2. After the primary election signal appears, the general stock price will have a pullback action, if the stock price pullback does not effectively break through the lower band, and the Bollinger band support line turns upward. At this time, it can be preliminarily confirmed as a ** signal.

3. The final confirmation of the ** signal is mainly to observe whether the trading volume can be moderately amplified.

When it comes to using Bollinger Bands, there are two buying and selling strategies:

Tactics. 1. When the opening of the Bollinger Bands is greatly enlarged, it gradually narrows over time, and its upper and lower bands are gradually approaching, and when the difference between the upper and lower bands is close to 10%, it is the best time to buy and sell.

The way to judge the up and down direction of the stock price when the Bollinger Bands receive the narrowest is to observe whether the stock price is running above or below the middle track at that time, or there are signs of falling below the middle track or obviously standing firm on the middle track, and the stock price should run upward in combination with whether the trading volume is significantly amplified, if so, it should be decisively intervened, on the contrary, once it falls below the middle track or runs down the lower track, it is advisable to sell the stock decisively. Observing the stock price movement in the past few months, if there has been a round of small rises before, it is more likely to stabilize in the middle track and rise again, and if it has experienced a huge rise before, it should be beware that the narrowing of the Bollinger Bands is only halfway, and then there is a possibility of a large increase.

Strategy 2: When the stock price rises for a period of time, but the increase is not too large and the stock price appears for a few days, at this time, the US line is formed on the Bollinger Bands chart to stabilize upward, but it is blocked near the upper band and then returns to the middle of the Bollinger Bands.

For the grasp of the intraday buying and selling point is often selected at the resonance point of the 15-minute Bollinger Bands and the 30-minute Bollinger Bands, for example, many ** are currently strong, and the intraday often forms a shuffle pullback, how to find the best buying point in the intraday, first of all, the Bollinger Bands should maintain an upward channel in the form, and it is best to be an open track. The stock price sticks down along the upper band to produce a fall, then look for the 15-minute Bollinger Bands, look for the position of the middle track, and then look at the position of the 30-minute and 60-minute middle rail, basically establish the price level in the heart, if there is a lot of overlap in the stock position, then a certain resonance point will inevitably be formed in this position, which should be the best ** point. Comprehensive ** index analysis, the current 5-minute track has fallen below the lower rail, 15 minutes also entered below the middle track, suggesting that tomorrow's opening may continue to probe, support should be at 1790 points, at this point should trigger **.

Generally in the ** market.

The use of 26 Bollinger Bands is a channel trading system that acts as a middle band. Therefore, it is very difficult to do this with strictly calculated parameters. Channels have well-defined highs and lows boundaries. It is necessary to study the recent trend and define a moving level of major support or pressure**.

Then set up parallel channels for the main moving flat according to this amplitude. This is the best channel indicator, and this is the pressure and support.

Here's how to use Bollinger Bands:

On the way, when the Bollinger Bands break through the middle band, increase the position, and sell when the Bollinger Bands break through the upper band and the stock price is far away from the upper band; The stock price is down, and when the Bollinger Bands fall to the middle band position, it can be appropriate**; The stock price falls below the medium track and should stay away in the short term; The stock price continues to decline, and it is released when the stock price falls to the lower track**; Sell if it runs along the lower band; If the stock price is large**, it can be light.

Of course, any technical indicator has a lag, so it is best to combine it with fundamental analysis.

Bollinger Bands

The Bollinger Bands (BOLL) indicator is one of the most commonly used tools for technical analysis, which calculates the "standard deviation" of the stock price and then finds the "trust zone" of the stock price.

The indicator draws three lines on the chart, the upper and lower lines can be seen as the upper and lower lines of the stock price, respectively, and between the two lines there is a stock price level**, and the parameters of the Bollinger Bands indicator should be set to 20. In general, the stock price runs in a channel formed by the upper and lower lines. Like MACD, RSI, KDJ and other indicators, the Boll indicator is also the most practical technical analysis reference indicator in the market.

Among all the indicator calculations, the Boll indicator is one of the most complex, introducing the concept of standard deviation in statistics, which involves the calculation of the middle and lower bands (MB), upper and lower bands (DN).

In addition, as with the calculation of other indicators, due to the different calculation periods selected, Boll indicators also include daily Boll indicators, weekly Boll indicators, monthly Boll indicators, annual Boll indicators, and minute Boll indicators.

The skill difference is as follows:

The Bollinger Bands (Boll) are made up of three lines: the upper band (the yellow line of the Boll line), the middle band (the white line of the Boll line), and the lower band (the purple line of the Boll line). 1. Inflection Point Trading Method:

When a round of continuous ** or ** end, once the upper Bollinger Bands (** process) or lower destruction track (during the descent) appear obvious turning (as shown in the figure below), at the same time, the KDJ indicator or MACD indicator has one or two dead crosses (** process) or golden cross (during the descent process), sell (** process) or sell (during the descent process) on the day of the turn.

Second, the shrinkage trading method:

When the upper and lower bands are close to or far away from the pattern, we are used to call opening or shrinking (as shown below). Generally, the shrinkage (indicated by the gray box in the chart) will accompany the rise and fall of the stock price. In the occurrence of opening and shrinking, the role of the middle rail is very important.

When the middle rail is in a continuous state, such as the continuous upward shrinkage of the middle rail indicates that the stock price is resting or the main force is washing, when the Bollinger Bands shrink flat is the first point, the middle rail appears a pattern reversal such as rising flat, at this time the shrinkage flat is the buy point.

3. Open mouth trading method:

Once there is an opening (as shown in the gray box in the figure), and the middle rail is in a continuous state, if the middle rail continues to rise, it means that the stock price will be closed again, and you can consider adding a position to obtain the short difference; If there is a pattern reversal in the middle of the track, such as going flat and turning downward, the opening of the mouth at this time is the selling point.