For determining the trend you must know three major things. First of all of we need knowledge of price action which we discussed in the previous posts. So today we will discuss Bollinger band role in determining the trend. While in the next article we will discuss Relative Strength Index role in the trend determining.
Short Introduction About Bollinger Band
It is the technical indicator which is developed by the famous technical trader Jhon Bollinger.
It has three bands.
Upper Bollinger band
Middle Bollinger band
Lower Bollinger band
Two Tips For Volatility
When Bollinger band widen, it means market has more volatility.
When Bollinger band contract it means market has less volatility.
When to Buy Crypto currency using Bollinger band
In the above picture a word buy here is written. Keep it in mind when price is lowering down touching lower Bollinger band then price is in selling mode so do not buy crypto currency at that time. Wait for the crypto currency cross middle Bollinger band then comes back near to previous low and candle becomes bullish then best time to buy.
When not to buy Crypto currency using Bollinger band
In the above picture a word No buy is written. Keep it in mind when price makes candles continuously with the lower Bollinger as shown in picture please do not buy crypto currency.
This strategy of Bollinger band is very helpful and I am using it in forex and crypto currency for last many years with lot of success and with addition of RSI and price action.
In the next article I will discuss RSI in detail.
You can ask me any question while writing in comments section about this article if you did not understand anything.