BollingerWorm !!!

[columbus]

1.Use standard Bollinger Bands ,that is, bb(20,2).

2.Use ema2-HIGH and ema2-LOW to outline the body of the worm.

3.If the body comes out of bands & re-enters ,then make an ENTRY.

4.The EXIT is, if body comes out the other band and re-enters the body.

5.In case of extreme Bullishness/extreme Bearishness another
pair is used pertaining to BB(20,1) or just for guidance in normal case also.

6.If candles are sandwiched between OUTER of BB(20,1) and INNER band
BB(20,2) then ride the trend .

7.If either ema-2H or ema-2L is cut twice by either BB(20,2),BB(20,1) or
SMA-20 in quick succession ,it indicates a END of a trend.

8.Continuation is indicated if both ema-2H and ema-2L are cut by SMA-20
and/or BB(20,1) and/or BB(20,2).

9.If the trade goes against you and if the divisions on Y-axis is not more
than 10,in that case you can add ONE or TWO trades,atleast 5 points apart.
(Or as per the volatility on that day)

 

[rrd6f4]

Hi Columbus,

Very bad day for the boll worm today. I had 4 consecutive losses. Let me know if you were able to avoid these signals and how u did it? I think that one good rule to follow would be to only enter trade one point above or below of the signalling candle. This way today, we would have avoided every loss giving signal.What do you think?

 

[timepass]

Hi Columbus,

Very bad day for the boll worm today. I had 4 consecutive losses. Let me know if you were able to avoid these signals and how u did it? I think that one good rule to follow would be to only enter trade one point above or below of the signalling candle. This way today, we would have avoided every loss giving signal.What do you think?

Check point no. 7. And where's your BB(20,1) ??

7.If either ema-2H or ema-2L is cut twice by either BB(20,2),BB(20,1) or
SMA-20 in quick succession ,it indicates a END of a trend.

 

[columbus]

Hi Columbus,

Very bad day for the boll worm today. I had 4 consecutive losses. Let me know if you were able to avoid these signals and how u did it? I think that one good rule to follow would be to only enter trade one point above or below of the signalling candle. This way today, we would have avoided every loss giving signal.What do you think?

Hi Rahul,

Sorry to note that.In fact ,I had a good day.Of course I was using another
method "EMA strip in BB".Any way ,both works on the similar principles,
with one Bollinger Band inside another.

The basic reason ,why you have lost was ,was ,absence of another Bollinger
Band BB(20,1).[This was pointed out by timepass]

BB(20,1) plays a very very crucial role.

6.If candles are sandwiched between OUTER of BB(20,1) and INNER band
BB(20,2) then ride the trend .

Today the trend was BEARISH ,throughout the day.(Middle line was Maroon colour throughout)

Either the market goes UP by 100 points or goes down by 100 points
it is relatively easy to play the market.

Anyway, do not lose heart at the small loss ,you will bounce back soon.

 

[columbus]

1.Use standard Bollinger Bands ,that is, bb(20,2).

2.Use ema2-HIGH and ema2-LOW to outline the body of the worm.

3.If the body comes out of bands & re-enters ,then make an ENTRY.

4.The EXIT is, if body comes out the other band and re-enters the body.

5.In case of extreme Bullishness/extreme Bearishness another
pair is used pertaining to BB(20,1) or just for guidance in normal case also.

6.If candles are sandwiched between OUTER of BB(20,1) and INNER band
BB(20,2) then ride the trend .

7.If either ema-2H or ema-2L is cut twice by either BB(20,2),BB(20,1) or
SMA-20 in quick succession ,it indicates a END of a trend.

8.Continuation is indicated if both ema-2H and ema-2L are cut by SMA-20
and/or BB(20,1) and/or BB(20,2).

9.If the trade goes against you and if the divisions on Y-axis is not more
than 10,in that case you can add ONE or TWO trades,atleast 5 points apart.
(Or as per the volatility on that day)

 

[columbus]

Hi Columbus,

Very bad day for the boll worm today. I had 4 consecutive losses. Let me know if you were able to avoid these signals and how u did it? I think that one good rule to follow would be to only enter trade one point above or below of the signalling candle. This way today, we would have avoided every loss giving signal.What do you think?

 

[rrd6f4]

Columbus and Timepass,

Thanks for your quick replies. I am sorry for my confusion but I thing have been following Boll Worm strategy wrongly. I dont understand "ride the trend". Does it mean that even if you get signal ignore it? So on my first buy, price was not between outer band of (20,1) and inner band of (20,2). It resulted in loss of 20 points. Now on 2nd buy, price was sandwiched between them, so is it not a valid buy signal? Also i dont understand rule 9. Should i add on my buy or should i reverse the position?

Thanks a lot for your time.

Regards,

Rahul

 

[columbus]

Rahul,

Basically the BB posted by you contains 2 parts, that is first (upto 1100hrs on
5 min Time frame) containing yesterday's + today's candles and second
contains TODAY's samples only.The first one is marked by CONVEX nature
which may be due to GAP UP/ GAP DOWN.

In fact you have one more line pertaining to SMA-20 and it serves as
TREND LINE because if the trend is UP ,it will be in ONE colour and if it is
DOWN it will be in another.

So ,together with SMA-20 , BB will be divided into 4 Zones.

If the trend is DOWN and candles are in bottom zone ,we SHORT.

 

[columbus]

1.Use standard Bollinger Bands ,that is, bb(20,2).

2.Use ema2-HIGH and ema2-LOW to outline the body of the worm.

3.If the body comes out of bands & re-enters ,then make an ENTRY.

4.The EXIT is, if body comes out the other band and re-enters the body.

5.In case of extreme Bullishness/extreme Bearishness another
pair is used pertaining to BB(20,1) or just for guidance in normal case also.

6.If candles are sandwiched between OUTER of BB(20,1) and INNER band
BB(20,2) then ride the trend .

7.If either ema-2H or ema-2L is cut twice by either BB(20,2),BB(20,1) or
SMA-20 in quick succession ,it indicates a END of a trend.

8.Continuation is indicated if both ema-2H and ema-2L are cut by SMA-20
and/or BB(20,1) and/or BB(20,2).

9.If the trade goes against you and if the divisions on Y-axis is not more
than 10,in that case you can add ONE or TWO trades,atleast 5 points apart.
(Or as per the volatility on that day)

@Rahul,

ADD is illustrated in today's plot in a better way.
After placing a BUY order,at 1300 hrs,3 UP candles were seen ,but later 5 were RED
candles.In such cases ,there is no other go ,than adding to previous
position.

 

[rrd6f4]

Columbus,

So if i am understanding correctly, if the trend is down then you should not buy even if the worm body enters the band. This then contradicts rule 3. Also in post 4, third white spot suggests buying in downtrending market. I guess this has become lot confusing. I am still in dilemma about when to buy and when to sell. My understanding is if worm body crosses lower band then buy and vice versa.

Thanks,

Rahul