Trade Bitcoin Trading

Bollinger Band

Derived from the original and initial Bollinger band.

The Bollinger Fibonacci ratios indicator tracks volatility, but it doesn't use standard deviation to set the channel width. Instead, it relies on a smoothed ATR, multiplying it by Fibonacci ratios like 1.618, 2.618, and 4.236.

These standardized lines, subsequently multiplied by the Fibo ratios, are then either added to or subtracted from the Moving Average (MA).

This forms 3 upper Fibonacci bands and Three lower Fibonacci bands

Middle band forms the basis of the trend.

Bollinger Bands tool - Bollinger Bands with Fibonacci on BTCUSD charts

BTCUSD Analysis and How to Generate Trading Signals

This specific BTCUSD indicator is employed to ascertain critical support and resistance boundaries for cryptocurrency movements.

The lines below represent support points while those above are resistance levels.

The outer-most bands provide the strongest support/resistance.

Inner most bands provide least support/resistance.

The innermost band represents Fibonacci 38.20% retracement level

The second band represents Fibonacci 50 % retracement level

The outermost band represents Fibonacci 61.80% retracement level

This tool spots spots where Bitcoin prices could turn around. (Bitcoin Pullback Zones)

When the bitcoin price reaches one of the lines and reverses, it generates an entry or exit trade signal.

Honestly, it's smart to back up your trading signal with other indicators, like the moving average (MA). That way, you get more confirmation - just like you see in the example below.

Bollinger Bands Explained - Bollinger Bands with Fibonacci in BTCUSD - Drawing Fibonacci Projections

Technical Analysis in BTCUSD Crypto Trading

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