How to trade with Bollinger Bands
Trend reversal patterns with Bollinger bands
As a rule, a candle closing outside Bollinger bands followed later by a candle closing inside the Bollinger bands serves as an early signal of forming trend reversal. It is, however, not a 100% assurance of an immediate trend reversal.
Since long aggressive trend develop not that often, there will be on general more reversals than continuation cases, still only filter signals form other indicators may help to spot true and false market tops and bottoms.
Speaking of the last, Bollinger bands are also capable of aiding double top and double bottom pattern recognition and trading.
Trend reversal patterns with Bollinger bands
As a rule, a candle closing outside Bollinger bands followed later by a candle closing inside the Bollinger bands serves as an early signal of forming trend reversal. It is, however, not a 100% assurance of an immediate trend reversal.
Since long aggressive trend develop not that often, there will be on general more reversals than continuation cases, still only filter signals form other indicators may help to spot true and false market tops and bottoms.
Speaking of the last, Bollinger bands are also capable of aiding double top and double bottom pattern recognition and trading.
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