BollingerBands

[Raghavacc]

Ok Mr Colombus

The system is not good for forex but i looked at the dax ftse on 1hour charts and the results are fabulous please do have a look, not good for grazing but for piercing they are very profitable,
After much thought i think it best to place your stop at the low or high of either red/green candle which ever one is furthest away if you like risk and nearest one if you are a little more cautious,

once the piercing has taken place either go long when the high of the last "piercing candle" is broken and at the bottom bolli.
Or short when low of the "piercing candle" is broke.

Measure the last 1 hour piercing candle and place your limit order exactly the same number of points above the high or low of the last piercing candle. I.e "Measured move"

I personally think that when placing limit orders you can place the order at 90% of the measured move instead of 100% as i beleive that the institution etc have their sytems setup to often not allow the completion of the measured move, as they know many people trade like this.

I know some one will disagree with this but backtest it for your self and you will see the winners thanks to Mr coloumbus' help.
You can also maybe place in a break even stop once you get to around 40% of the measured move, although i have not looked into this deep enough but this may offer those of you a little more protection.

Remember guys this is a longer term trade and can take upto 6-7 hours to be completed and patience is required.

Guys do have a look and let me know your thoughts positive or negative

Thanks again to the only forum in the world where for once we all want to help each other and not argue

Regards MDS

Hi mds1,

The effort of Columbus deserves endless appreciation. I am one of the keen observer and follower of this method and even tested on Indian commodities and stocks and the results were fabulous.On a narrow range day its one of the best method to catch those single and couple of runs.On a trending day it almost catches exact bottom and top.

Coming to further observations, even for swing trading its utility cannot be undermined.I am attaching ICICI Bank daily chart and I have marked 9 areas where the Bands pierced candles as per the method. I made small tweak to the entry under this method as follows.

To go short upper band pierces green and red.Then there should be successive lower close to the pierced red candle.Vice versa for long entry.

There will be failed trade like any other method but they will be very small.The winners are too big and will outplay losers.

Regards
Raghav

 

[columbus]

To go short upper band pierces green and red.Then there should be successive lower close to the pierced red candle.Vice versa for long entry.

Raghav

Hi Raghav,

I really liked your tweak.

 

[veluri1967]

Hi, columbus

Just check the following if they are useful in tweaking the system.

Upper vs. lower action: Location of price bars determines the strength of the current phase. Price within the upper band signifies power while price within the lower band signals weakness.

Price direction: Direction of price within the band identifies convergence-divergence with the current trend. Divergence prints when price rises within the lower band or falls within the upper band. Convergence prints when price rises within the upper band or falls within the lower band.

Trend testing: The lower, center, and upper bands represent S/R for the trend. Reversal off any band increases odds that price will expand in the reversed direction and return to the last band crossed or touched.

 

[columbus]

Hi, columbus

Just check the following if they are useful in tweaking the system.

Upper vs. lower action: Location of price bars determines the strength of the current phase. Price within the upper band signifies power while price within the lower band signals weakness.

Price direction: Direction of price within the band identifies convergence-divergence with the current trend. Divergence prints when price rises within the lower band or falls within the upper band. Convergence prints when price rises within the upper band or falls within the lower band.

Trend testing: The lower, center, and upper bands represent S/R for the trend. Reversal off any band increases odds that price will expand in the reversed direction and return to the last band crossed or touched.

Hi veluri,

Thanks for your inputs.

Yes, if CANDLES are concentrated in TOP band near the boundary it signals
STRONG up move ,in LOWER band near the boundary it signals strong
down move but they are concentrated around CENTRAL line it
signals choppy market.

 

[columbus]

BB(20,2) of nifty futures on time frame 4,6min are presented below.

Go long when Red+Green candles pierce the bottom band and wait for 15minutes
for confirmation after taking position, otherwise come out with stoploss

Go short when Green+Red candles pierce the top band and wait for 15minutes
for confirmation after taking position , otherwise come out with stoploss

Otherwise continue with TREND if candles graze(ride) TOP/BOTTOM
bands.

 

[Raghavacc]

Since last so many months I had an intention of testing this method on a narrowest day and today was that day. Nifty was hovering between 5100-5120.

I am analysing the trade based on Guidelines of this method as well as my small tweak.

After deducting brokerage,slippage, my execution delay i could get around 25 points which is fair enough for a tight range bound day.

1.Long entry marked : Lower BB pierced a hammer and next was a green bar closing above the pierced bar. Successfull trade.

2.SHORT entry :Upper BB pierced a shooting star and next was a red bar closing below the pierced bar.( AS PER MY OBSERVATION OVER THE MONTH ITS ONE OF THE BEST SIGNAL TO GO SHORT). Successfull trade.

3.Long entry :Lower BB pierced the tail of the red bar .This was the area where it took off last time.wait. Next was a green bar with higher close. Successfull trade.

4.SHORT entry :Upper BB pierced a shooting star and next was a red bar closing below the pierced bar.( AS PER MY OBSERVATION OVER THE MONTH ITS ONE OF THE BEST SIGNAL TO GO SHORT). Successfull trade.

6. Signal for Long entry :Wait for the next bar to close.Didn't enter since next bar didn't close above the pierced bar.

I traded on 6 Minutes chart using 4 Minutes chart besides for tuning the trade.

Regards
Raghav

 

[columbus]

Since last so many months I had an intention of testing this method on a narrowest day and today was that day. Nifty was hovering between 5100-5120.

I am analysing the trade based on Guidelines of this method as well as my small tweak.

After deducting brokerage,slippage, my execution delay i could get around 25 points which is fair enough for a tight range bound day.

1.Long entry marked : Lower BB pierced a hammer and next was a green bar closing above the pierced bar. Successfull trade.

2.SHORT entry :Upper BB pierced a shooting star and next was a red bar closing below the pierced bar.( AS PER MY OBSERVATION OVER THE MONTH ITS ONE OF THE BEST SIGNAL TO GO SHORT). Successfull trade.

3.Long entry :Lower BB pierced the tail of the red bar .This was the area where it took off last time.wait. Next was a green bar with higher close. Successfull trade.

4.SHORT entry :Upper BB pierced a shooting star and next was a red bar closing below the pierced bar.( AS PER MY OBSERVATION OVER THE MONTH ITS ONE OF THE BEST SIGNAL TO GO SHORT). Successfull trade.

6. Signal for Long entry :Wait for the next bar to close.Didn't enter since next bar didn't close above the pierced bar.

I traded on 6 Minutes chart using 4 Minutes chart besides for tuning the trade.


Regards
Raghav

Hi Raghav,

Good to know about your trades.
Getting 25 Nifty points when the range itself is 32 points is Great.

 

[columbus]

BB(20,2) of nifty futures on time frame 4,6min are presented below.

Go long when Red+Green candles pierce the bottom band and wait for 15minutes
for confirmation after taking position, otherwise come out with stoploss

Go short when Green+Red candles pierce the top band and wait for 15minutes
for confirmation after taking position , otherwise come out with stoploss

Otherwise continue with TREND if candles graze(ride) TOP/BOTTOM
bands.

 

[columbus]

BB(20,2) of nifty futures on time frame 4,6min are presented below.

Go long when Red+Green candles pierce the bottom band and wait for 15minutes
for confirmation after taking position, otherwise come out with stoploss

Go short when Green+Red candles pierce the top band and wait for 15minutes
for confirmation after taking position , otherwise come out with stoploss

Otherwise continue with TREND if candles graze(ride) TOP/BOTTOM
bands.

ATR is a bit improved today.

 

[columbus]

BB(20,2) of nifty futures on time frame 4,6min are presented below.

Go long when Red+Green candles pierce the bottom band and wait for 15minutes
for confirmation after taking position, otherwise come out with stoploss

Go short when Green+Red candles pierce the top band and wait for 15minutes
for confirmation after taking position , otherwise come out with stoploss

Otherwise continue with TREND if candles graze(ride) TOP/BOTTOM
bands.