BollingerBands
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I believe you are right as far as the rest is concerned. I also believe it is temporary. As per my post on Jan.17th, I believe Nifty is still in for another sharp decline. It has been halted by the weekly TL. This recovery should be contained around circa 5700, before another leg is seen going south. Very strong support which should bring an even more imminent rebound is going to be at 5222.
BTW, IMO, this corrective leg could be more consolidative. I'm trying to cut to the chase with my views, because it has nothing to do with the BB's
BTW, IMO, this corrective leg could be more consolidative. I'm trying to cut to the chase with my views, because it has nothing to do with the BB's
The last time Nifty Spot actually closed below the lower BB on the weekly was 24th Oct 2008 - which is the lowest weekly closing before the uptrend. That is the significance of what happened this week.
Two ways to look at this
- In the downtrend before, closing below the lower BB often happened. So this is the start of that ...
- Since we closed below, a quick upmove is anyways coming and lets position ourselves for that
Another observation - after the recent all-time high of Nov, we have had many red wide ranged weekly bars. Volatility is returning big time.
E.
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Two ways to look at this
- In the downtrend before, closing below the lower BB often happened. So this is the start of that ...
- Since we closed below, a quick upmove is anyways coming and lets position ourselves for that
Another observation - after the recent all-time high of Nov, we have had many red wide ranged weekly bars. Volatility is returning big time.
E.
Uploaded with ImageShack.us
I've noted the fact that when the candle finished below the bands on Oct 26, 2008, this was when the bands were extremely wide, and that of course, was because of the strong one way move it made. In other words, price hit its extremity (sigma 2) within the scope of the large move.
This time the candles did not have far to go, because of the relative tight activity, by comparison to Oct 2008. Naturally, this is because the SD is not as wide because of the tight activity.
I do agree with you. Nifty is in for a correction before it puts in another leg south.
Another thing about BB's I've noticed is the case of the move from the week of Oct 26,2008. The bands, because of the sharp downtrend, were pointing very sharply south. From the open of that week, price action continued another 303 points south. The bands right now are still leveled, and this is because of the activity of the last 20 candles. Current price is only 24 points above the open of the candle counting 20 back, which partially accounts for the tight bands, but also the bands will be in a straight line. Initial hit at the opposite end will be well supported, because instead of it being a slippery slope, it is a straight line. Price action on the bounce should be contained under 5700. That being the case, the bottom bands will tilt southward, and then lose its elasticity.
Something else that was very noticeable, and makes going long something of low risk. I suppose most people reading this thread know this, but 95% of all data is contained within the sigma 2's. That is a natural statistical fact. The other way to look at is when the candle closes outside, there is only 5% chance of that happening. Add to that the fact this band is level, and it adds to the high probability. I noticed on your chart there are 150 candles with only 8 closing on the outside of the 2's, which means, in this case 94.7% of the data is contained within. which means there is only a 5.3% chance of the current candle staying on the outside
I better be quiet. Nothing like the outsider of the thread taking up all the space--lol.
This time the candles did not have far to go, because of the relative tight activity, by comparison to Oct 2008. Naturally, this is because the SD is not as wide because of the tight activity.
I do agree with you. Nifty is in for a correction before it puts in another leg south.
Another thing about BB's I've noticed is the case of the move from the week of Oct 26,2008. The bands, because of the sharp downtrend, were pointing very sharply south. From the open of that week, price action continued another 303 points south. The bands right now are still leveled, and this is because of the activity of the last 20 candles. Current price is only 24 points above the open of the candle counting 20 back, which partially accounts for the tight bands, but also the bands will be in a straight line. Initial hit at the opposite end will be well supported, because instead of it being a slippery slope, it is a straight line. Price action on the bounce should be contained under 5700. That being the case, the bottom bands will tilt southward, and then lose its elasticity.
Something else that was very noticeable, and makes going long something of low risk. I suppose most people reading this thread know this, but 95% of all data is contained within the sigma 2's. That is a natural statistical fact. The other way to look at is when the candle closes outside, there is only 5% chance of that happening. Add to that the fact this band is level, and it adds to the high probability. I noticed on your chart there are 150 candles with only 8 closing on the outside of the 2's, which means, in this case 94.7% of the data is contained within. which means there is only a 5.3% chance of the current candle staying on the outside
I better be quiet. Nothing like the outsider of the thread taking up all the space--lol.
The last time Nifty Spot actually closed below the lower BB on the weekly was 24th Oct 2008 - which is the lowest weekly closing before the uptrend. That is the significance of what happened this week.
Two ways to look at this
- In the downtrend before, closing below the lower BB often happened. So this is the start of that ...
- Since we closed below, a quick upmove is anyways coming and lets position ourselves for that
Another observation - after the recent all-time high of Nov, we have had many red wide ranged weekly bars. Volatility is returning big time.
E.
Uploaded with ImageShack.us
Two ways to look at this
- In the downtrend before, closing below the lower BB often happened. So this is the start of that ...
- Since we closed below, a quick upmove is anyways coming and lets position ourselves for that
Another observation - after the recent all-time high of Nov, we have had many red wide ranged weekly bars. Volatility is returning big time.
E.
Uploaded with ImageShack.us
The last time Nifty Spot actually closed below the lower BB on the weekly was 24th Oct 2008 - which is the lowest weekly closing before the uptrend. That is the significance of what happened this week.
Two ways to look at this
- In the downtrend before, closing below the lower BB often happened. So this is the start of that ...
- Since we closed below, a quick upmove is anyways coming and lets position ourselves for that
Another observation - after the recent all-time high of Nov, we have had many red wide ranged weekly bars. Volatility is returning big time.
E.
Uploaded with ImageShack.us
Two ways to look at this
- In the downtrend before, closing below the lower BB often happened. So this is the start of that ...
- Since we closed below, a quick upmove is anyways coming and lets position ourselves for that
Another observation - after the recent all-time high of Nov, we have had many red wide ranged weekly bars. Volatility is returning big time.
E.
Uploaded with ImageShack.us
BB's are narrowed down, any close beyond any BB is likely to continue in that direction .
vin
I once gave the analogy that if the bands are pointing down, as in a sharp downtrend, when you hit the bands, it is like hitting a slippery slide. You need more than just, "It hit the band so it is reversing". Yet, if you hit the band and it is straight, like the band in the most recent example, then you are getting a bounce off of it, because rather than a slippery slope, you have hit something that is fortified.
One way you can document what I just said is by looking at any recent example of a candle hitting the band that is straight, and looking to see if that candle went further. The chances are minute. Yet chances are really good that the trend will continue when a candle has hit the band while pointing sharply in the same direction.
The reasoning is clear. When you are in a sharp downtrend, there is no guarantee as to when the trend is coming to an end (That is in just giving a cursory glance at the chart. Also, in a sharp downtrend, let's say you bounce off the bands, gravity is still against you. You still may not reverse even though you have moved away from the bands.
The most recent example is just the opposite. The 20.2 setting measures the last 20 candles with a standard deviation of 2. When you look back at the recent action on the last 20 candles it gives the appearance of a broad channel, so the candle has hit the bottom of that channel, and the BB is indicating accordingly.
After this downtrend progresses some more, there will be a tilt in the bands because the SD has increased as per price action
One way you can document what I just said is by looking at any recent example of a candle hitting the band that is straight, and looking to see if that candle went further. The chances are minute. Yet chances are really good that the trend will continue when a candle has hit the band while pointing sharply in the same direction.
The reasoning is clear. When you are in a sharp downtrend, there is no guarantee as to when the trend is coming to an end (That is in just giving a cursory glance at the chart. Also, in a sharp downtrend, let's say you bounce off the bands, gravity is still against you. You still may not reverse even though you have moved away from the bands.
The most recent example is just the opposite. The 20.2 setting measures the last 20 candles with a standard deviation of 2. When you look back at the recent action on the last 20 candles it gives the appearance of a broad channel, so the candle has hit the bottom of that channel, and the BB is indicating accordingly.
After this downtrend progresses some more, there will be a tilt in the bands because the SD has increased as per price action
Thanks bro..........
The last time Nifty Spot actually closed below the lower BB on the weekly was 24th Oct 2008 - which is the lowest weekly closing before the uptrend. That is the significance of what happened this week.
Two ways to look at this
- In the downtrend before, closing below the lower BB often happened. So this is the start of that ...
- Since we closed below, a quick upmove is anyways coming and lets position ourselves for that
Another observation - after the recent all-time high of Nov, we have had many red wide ranged weekly bars. Volatility is returning big time.
E.
Uploaded with ImageShack.us
Two ways to look at this
- In the downtrend before, closing below the lower BB often happened. So this is the start of that ...
- Since we closed below, a quick upmove is anyways coming and lets position ourselves for that
Another observation - after the recent all-time high of Nov, we have had many red wide ranged weekly bars. Volatility is returning big time.
E.
Uploaded with ImageShack.us
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