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