Double Top and Double Bottom Strategies
A trader should wait for the price to turn in the opposite direction after touching one of the Bollinger bands before considering that a reversal is happening.
Even better a trader should see the price cross over the moving average.
Double Bottom Trend Reversals
A double bottoms is a buy signal set-up. Double top forms when price action penetrates the lower Bollinger band then rebounds forming the first price low, then after a while another price low is formed, & this time it is above the lower Bollinger band.
The second price low must not be lower than the first one and it important is that the second price low does not touch or penetrate the lower Bollinger band. This bullish setup is confirmed when price action moves & closes above the middle band (simple moving average).
Double Bottom - Bollinger Bands Trend Reversals Strategy Using Double Bottoms Setup Patterns
Double Top Trend Reversals
A double top is a sell signal set-up. Double top forms when price action penetrates the upper Bollinger band then rebounds down forming the first price high., then after a while another price high is formed, & this time it's below the upper Bollinger band.
The second price high must not be higher than the first one and it important is that the second price high does not touch or penetrate the upper Bollinger band. This bearish gold setup is confirmed when price action moves & closes below the middle band (simple moving average).
Double Top - Bollinger Bands Trend Reversals Strategy Using Double Tops Setup Patterns