![]() If you have, you would’ve noticed the following scenarios: Have you been watching the dance between the market and the Bollinger Bands? Price Action Scenarios with Bollinger Bands From there, you will be able to uncover valuable trading information. So our focus as price action traders is to watch how the Bands interact with price action. This characteristic of the Bollinger Bands is the key to using it to read price action in the context of its recent volatility. Hence, Bollinger Bands* expand and contract according to the standard deviation of past price action*. ![]() And the width of that envelope depends on the price volatility (or standard deviation). In a nutshell, Bollinger Bands create an envelope around a moving average of price.
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