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Bollinger Band Strategy

Bollinger bands provide a user-friendly alternative to trend channels, revealing the range within which the price predominantly fluctuates. When working with Bollinger bands, you can rely on a signal: if the price significantly breaches the band, it typically tends to revert to the central indicator line.

What to do when you see this signal:

1) Add the Bollinger band indicator to the price chart.

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Indicator settings

2) Wait when the price moves outside the indicator.

3) After the price has returned inside and a confirming candlestick has been closed we can open a deal directed towards the central indicator line.

Buying a call after the lower band breakout

Buying a put after the upper band breakout

The upper and lower Bollinger bands can be used as the levels of support and resistance.

What to do:

1) The price is closed at the upper/lower indicator line.

2) A new candlestick moves in reverse direction.

3) Wait for a confirmation and trade directed towards a central indicator line.

Buying a put after bounce off the upper band — resistance line

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