Bollinger Bands Gold Price Action in Ranging Gold Trading Markets

Bollinger Bands Gold Indicator is also used to identify periods when a gold market trend is overextended. The guidelines below are considered when applying this gold indicator to a sideways xauusd trend.

Bollinger Bands Gold Indicator is very important because it is used to give gold trading signals that a xauusd price break out may be upcoming.

During a gold trending market these techniques do not hold, this only holds as long as Bollinger Bands are pointing sideways.

• If the xauusd trading price touches the upper band it can be considered overextended on the upside - overbought.
• If the xauusd trading price touches the lower band the xauusd trading price can be considered overextended on the bottom side - oversold.

One of the uses of Gold Bollinger Bands indicator is to use the above overbought and oversold gold trading guidelines to establish buy and sell targets during a ranging xauusd market.

• If xauusd trading price has bounced off the lower band crossed the center-line moving average then the upper band can be used a sell level.
• If xauusd trading price bounces down off the upper band crosses below center moving average the lower band can be used as a buy level.

Trading Bollinger Bands in Ranging Gold Trading Markets - Bollinger Bands Strategy

In the above ranging gold market the instances when the price hits the upper or lower bands can be used as profit targets for long/short gold trade positions.

Gold trades can be opened when the xauusd market hits the upper resistance level or lower support level. A stop loss order should be placed a few pips above or below depending on the gold trade opened, just in case the xauusd trading price action breaks-out of the range within these Bollinger bands.