How to Use Bollinger Bands to Pinpoint Support and Resistance Levels

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Discovering Bollinger Bands. www.financial-spread-betting.c... PLEASE LIKE AND SHARE THIS VIDEO SO WE CAN DO MORE! Bollinger Bands are a very useful tool invented by John Bollinger in the early 1980s. They give a frame of reference for where you expect the price to go. They are “adaptive” bands around the price chart, changing dynamically with volatility and thus providing much more information than bands at a set distance from the average price.
The centreline is a moving average, and therefore nothing special. You can expect the price candles to be above the moving average in an uptrend and below the moving average in a downtrend, as inevitably the moving average is a lagging indicator, following behind the price movement.
The bands are drawn at a constantly changing distance from the moving average, one band above and one below. The distance is conventionally taken at twice the standard deviation as this provides the most effective bands, though you can customize the indicator as you wish. It’s important to know that statistically using twice the standard deviation means that the price is between the upper band and the lower band 95% of the time.
What this means in practice is that in an uptrend you can expect to see the price between the centreline and the upper band most of the time. In fact, if you study some charts you will see that the price tends to hug the upper line in an uptrend. Similarly, in a downtrend the price will tend to drag along the lower line. When the price does breakthrough the Bollinger band, it usually returns swiftly and therefore this would not be a place to make a trade.
One way of trading on bands is to wait in an uptrend for the price to drop to the centerline, and then go long with the expectation that the price will go back up to the upper band. You can do the same thing in reverse on a downtrend.
There are many other ways to use Bollinger bands, but one of the most interesting things to notice is what happens as the width of the bands expands and contracts. As stated, this is plotted using the standard deviation, and therefore it is a measure of the volatility of the stock.
Many times you will see the bands pinching together, almost as if they are constraining the movement of the price, although of course it is actually the price’s lack of movement that reduces the size of the bands. Either way, when the bands have pinched right down it is common to see a strong move in the price, either up or down, almost as if it reaches a point where it cannot be constrained anymore.
In this situation, it is important to note that the Bollinger bands really give you no indication which way the price will break out. They simply give you a strong indication that a powerful move is about to happen. You can either try and anticipate the direction by using other indicators, or you can wait until the move is underway and trade to ride the rest of it.
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[@acegibson9533]

I have been using this technique and it's like have a crystal ball. You need to be able to read daily charts to jump in/out at the optimal time. Thank you for posting this.

[@eunicechin7227]

Excellent better than any others I have seen. Thanks a million!

[@justdoit4834]

"Get ya' face ripped clean off doing that" xD

[@raymanvictor9060]

i have learnt so much from...please accept my deepest gratitude, friend.

[@kapilkumaronlyweeklyviewin7403]

I am Indian I don't know English very well but I am understand u r video u explain so nice Thanks you sir

[@realrahzz]

I liked it. Thank you very much. Very informative.

[@mustanghunts]

Thanks for that....very clear!

[@ShillBullshit007]

Great video.....well in the flow of knowing ☺

[@ShoppingWithStyle]

I use bollinger bands for trading russell 2k futures. It reminds me not to get too overextended. Numbers will revert to the mean. I try to watch the trades the entire time, but if I can't I use them to help decide where to put price target sell limit order.

[@markman1276]

Thank you for your video and great teaching.

[@Bakerromeo]

Thank you aloooot, great videos :D

[@jeromewallace3744]

love the video, tried this friday and won 8 of 10 trades,do you have any live video trades with BB and Stoch or RSI?

[@AbdulSamiHijazi]

Hello, Very informative,..... Please guide Bollinger Bands with Fractals......

[@mattdathew2794]

thanks men, that's very good

[@kvjqxzz5905]

great stuff

[@maartenbos1396]

very well done

[@Sar10101]

Great video

[@ilmapranaityte8203]

Thanks, how do i colour in BB on mt4, also change the colour of the midline?

[@denisaunga524]

Good work

[@89makeveli]

Another great video! Who is this guy? Learning everyday! Any links, tips or ideas on how to choose the right stock to trade (scalping or intra day) I don't want my face ripped clean of!

[@ukspreadbetting]

His name is Mark. Check some of the videos here: kzbin.infosearch?query=filtering+stocks and here kzbin.infosearch?query=finding+stocks+to+trade

[@Observ8or]

Great explanation man!!

[@heneralluna7899]

Bro nice explain but you get my attention from your intro video do you have a copy with no txt??

[@ukspreadbetting]

no text?

[@tloutlou2655]

Bollinger is best for ranging markets

[@andyshortland]

Bollinger Bands.. are these the same as Price Envelopes?

[@leonvillegas8035]

Please, change the colors of the upper band and the lower band for better contrast view grasping.

[@gidinationsyounglived500]

BB are the best indicators...

[@cryptomavic1]

I've got a trademarked indicator that gas a bollinger option along with Murray channels or fib based strats... it is a leading and lagging indicator. ... by leading ..there us a cloud that forms when price makes a sudden move and I've back tested just the clouds and they fill like cme gaps! Like most of the time...90% hit rate I came out with! There is no indicator like it! For all asset classes!

[@DouglasHorch]

Thx... I don't want my face ripped clean off

[@chillistationgameplay7950]

Mean and median are not the same.

[@alzahirshamji]

✌️

[@wilsonswgatan9546]

used this in binary but all loss--- or perhaps expert option is fraud hahahhaha