Rolf IndicatorsPrice ActionTechnical AnalysisTradeciety Academy 27 Comments 58, Views. Let me walk you through the points 1 to This is a classic reversal pattern where the bearish trend strength faded. The first swing high reached the outer band whereas the following two failed — fading strength.
It tried to pull away, but bears were always in control. At the same time, the meaning of such signals becomes much more important because it shows significant price extremes. There are bollinger types of tops that you need to know about:. The screenshot below shows both scenarios: I marked the second spike with an arrow — this was a trend continuation signal as price failed to break higher during the downtrend. The strong spike that was followed by a fast rejection showed that bulls lacked power.
During trends, the moving average holds very accurately and a break of that moving average is usually a meaningful signal that the sentiment has shifted. The screenshot below shows nicely how price trended between the outer bands and the moving average both on the way up and down.
During the trend, the moving average could have been used as a re-entry signal to add to existing positions during pullbacks. Furthermore, the moving average can be used as a trade exit signal where a trader does not close his existing positions unless price has broken the moving average. Hello Horacio, you can use the indicator across all timeframes. Bands recommend checking out moving averages and the RSI. In our YouTube channel, we explain all different tools and how to use them https: Do you mind me asking how you have started learning all this stuff?
Anyway, what I wanted to ask. Could it be that there is a small mistake when you say: This shows weakness and can point towards a potential reversal.
I really enjoyed your article on Bollinger Bands. Actually for myself ,after countless back testing of many strategies and indicators, I find Bollinger Band is still the best tool to use. Especially for strength of trends and reversals. You explained it well. I also very much like how you assess trend strength and loss of trend momentum while using Bollinger Bands. Great article and video. Bollinger guide RSI to get muximum benefits you appy it during the 4h00 trading period where London and USA overlaps bollinger each other.
What a great article. Hi, really loving your site and youtube videos. Maybe I am just overtired from cramming trading knowledge, but would love if you can clairfy.
Where exactly would you look to open long and short postitions and exit using bollinger bands and where would your place stop losses in trending and sideways markets. I trade mainly forex. In a few days, we will roll out a new update for Tradeciety where we lay out our whole process and strategy step by step. Your email address will not be published. Trading Resources Tradeciety Academy About us Contact Webmasters.
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