Best Trading Strategy Using Bollinger Bands Indicator

 

Bollinger Bands is a technical indicator that serves to determine the movement of the normal price range for all assets. When the price is outside the normal limits, this can be a sign to buy.

 

Pocket options :

 

How does it work?

Bollinger Bands represent 3 lines on the price chart which can narrow or widen depending on the volatility of the market. When the market is quiet the Bollingerr Bands narrow, but when there is an abnormal price spike, the Bollinger Bands widen.

Bollinger Bands Strategy

Bollinger Bands is a trading strategy aimed at establishing trend reversals and price pullbacks to the average price level.  

Simple pattern:

•  Apply the Bollinger Bands indicator to the indicator
  

•  Wait for the candle to break above/below the upper or lower Bollinger Band.

•   If the candle closes above the Bollinger band, it will show a signal that the price will soon fall   and return to its average – buy a put option.

• If the candle closes below the Bollinger band, this will indicate a signal that the price will soon fall and return to the call option average. 

Despite its simplicity, Bollinger Bands are a very useful indicator. Practical experience and proper analysis are very important when using technical indicators. It is these skills that distinguish beginner and professional traders. It should also be noted that Bollinger Bands are not an all-in-one instrument and are not 100% correct. 

 You need to combine it with other indicators to get more accurate results.

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