Wednesday, June 18, 2008

Bollinger Bands

Bollinger Bands

Used to measure the market’s volatility.
They act like mini support and resistance levels.
Bollinger Bounce.

A strategy that relies on the notion that price tends to always return to the middle of the Bollinger Bands.
You buy when the price hits the lower Bollinger band.
Bollinger Squeeze
A strategy that is used to catch breakouts early.

When the Bollinger bands “squeeze” the price, it means that the market is very quiet, and a breakout is eminent

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