The Bollinger Bands technique uses elements of statistics, supply management and technical analysis in order to come up with a set of bands which will help contain normal price action. The upper Band should not be breached without some action from the trader to buy or sell the security. In addition, the lower band should not be crossed without some action from the seller. The middle band is determined using statistical methods such as moving averages and exponential moving averages. These two tools are excellent to use because they take into account both historical and current price actions of the securities. Not only will Bollinger Bands help traders make better trades, they will also encourage traders to combine other methods of technical analysis to come about the best prediction possible.
Identifying And Using Bollinger Bands
There are many indicators which are used in Bollinger Band analysis, which was developed by John Bollinger in the 1980s. Mr. ...
