Bollinger Bands CFDs Methods

• How Bollinger Bands Works
• Bollinger Bands Market Volatility Analysis
• Bollinger Bands Bulge and Squeeze
• Bollinger Bands Price Action in Trends
• Bollinger Bands Price Action in Range
• Bollinger Bands & Trend Reversals
• Bollinger Bands CFD Strategy Summary

Bollinger Bands CFDs Trading Indicator Strategy

Bollinger Bands indicator acts as a measure of volatility. Bollinger Bands indicator is a price overlay indicator.

Bollinger Bands indicator consists of three lines or bands: the middle band (moving average), an upper band a lower band. These three bands will enclose the price and the price action will move within these 3 bollinger bands.

Bollinger Bands indicator forms upper & lower bands around a moving average. Default moving average for bollinger bands indicator is the 20-SMA. Bollinger Band indicator use the concept of standard deviationss to form their upper and lower Bands.

The example of Bollinger Bands indicator is shown below.

Bollinger Band CFDs Trading Indicator - How to Trade CFD with Bollinger Band CFD Method

Because standard deviation is a measure of price volatility and volatility of the cfd market is dynamic, the cfd bollinger bands keep adjusting their width. Higher price volatility means higher standard deviation and the more the bollinger bands widen. Low price volatility means the standard deviation is lower and the bollinger bands contract.

Bollinger Bands forex indicator use price action to give a large amount of price action movement information. The price information given by the this bollinger bands indicator includes:

• Periods of low volatility- consolidation phase of the market.
• Periods of high volatility - extended trends, trending markets.
• Support and resistance levels of the cfd price.
• Buy and Sell points of the cfd price.