A complete guide on how to use "Bollinger Bands"
🧵
The thread will teach you.
🌟Building blocks of Bollinger Bands
🌟How to identify W-bottoms and M-tops using BB
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@bhatiamanu @kuttrapali26 @KommawarSwapnil
🧵
The thread will teach you.
🌟Building blocks of Bollinger Bands
🌟How to identify W-bottoms and M-tops using BB
Bookmark the tweet for future reference
🐦retween to share
@bhatiamanu @kuttrapali26 @KommawarSwapnil
Following are the building blocks of BB
🟢Middle line is 20 SMA
🟢Upper and lower band with 2nd deviation of volatility
🟢When price moves above/below band we'll see a trend
🟢Increase/decrease in the gap of band indicates high/low momentum
🟢Middle line is 20 SMA
🟢Upper and lower band with 2nd deviation of volatility
🟢When price moves above/below band we'll see a trend
🟢Increase/decrease in the gap of band indicates high/low momentum
BB are volatility bands
🟢let's say stock price is 100 and 1st volatility deviation is 3% and 2nd is 5% it means price can remain in the range of 103 to 97 for 68.2% of time and in range of 105 to 95 for 95.4% of time.
🟢We can expect action when stock breaches these prices
🟢let's say stock price is 100 and 1st volatility deviation is 3% and 2nd is 5% it means price can remain in the range of 103 to 97 for 68.2% of time and in range of 105 to 95 for 95.4% of time.
🟢We can expect action when stock breaches these prices
How to identify W-bottoms using BB
🟢Start building position after rejection from 2nd bottom and price is above 20 SMA
🟢Add final position after confirmation
🟢Start building position after rejection from 2nd bottom and price is above 20 SMA
🟢Add final position after confirmation
How to identify M-top using BB
🟢All the conditions are similar to W-bottom but in the opposite way.
🟢All the conditions are similar to W-bottom but in the opposite way.
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