All language subtitles for 8. Examples - How to Trade Bollinger Bands

Hello and welcome back to Cryptocurrency Trading Masterclass in this video, we'll take a look at some

examples on how to use Bollinger bands in real life, as it were.

So let's go ahead on this Bitcoin chart.

And the Bollinger Band Indicator.

And you can see that if you remember, there was a time after the big retail.

Collabs that basically the markets did nothing and, you know, for a while right around, like right

here, just above six thousand, you see the volunteer bands get skinny and then they get wider and

then they get skinny, they wider and et cetera.

So remember, that does mean something.

And this was a classic signal to go long, and that's because the Bollinger bands started to widen the

moving average, the median in the middle started to turn higher and you can see that the price broke

out.

So this tells you that something's changing.

So as you look at this, you have a market that's very quiet, right?

Let's go ahead and draw a line.

At basically twelve thousand five hundred.

Or so.

And you can see that we stumbled here a little bit and then we kind of fell back and then we broke here.

Well, there's two different reasons to think that this is a good trade.

Or at least a good signal to get long, because we've broken resistance.

We've broken the top of the Bollinger band, and keep in mind, it's based on the last 20 candlesticks

or 20 bars in this case, so the average will take wider.

Or take longer to widen out like it is.

So the fact that it's above this after this type of action, not necessarily a something that you need

to be concerned about in the sense that it's not, oh, my God, it's over, robot.

I need to start selling it because it's opening up now.

It takes, you know, when the deviations are this far apart.

And if you get like a, you know, a move all the way up here, for example, then yes, you have an

argument to be made for that.

This just shows you that business is picking up.

So you could have bought anywhere along this support level and the nice thing about the Bollinger band

is.

You can see that it really held up nicely and it wasn't and it really comes down to you, do you want

to take profit when it breaks down through the average?

Or do you want to wait until it breaks down through the bottom part of the volunteer band indicator,

that could have been done either way?

Which would have you all the way up to thirty thousand after an entry at around 12 and a half, so clearly

that could have been an extraordinarily big deal.

Now, if you want to look at tighter time frames like the hourly chart.

You're in an uptrend, so.

You know, based upon the daily that we had to show, so that eliminates all selling, I mean, you

can trade countertrend, but it's a great way to lose money.

At least until something major breaks in the market.

Well, right now, nothing major is broken and you'll notice that the band continues to tilt higher.

The last few last day or so, as I record this has drifted a bit lower.

But notice something.

Resistance, resistance, resistance broken above it, we're kind of dipping a little bit below it here.

I'd call that 38000, so pay close attention.

One way you could play this is if we break back above.

The 20 Esmay, the 20 simple moving average.

Then we're probably going to see another move like this or like this will be a continuation of what's

going on.

Regardless, you don't have a cell signal right now, even though it drifted lower.

Yes, you could say, all right, well, we broke down here.

It failed here.

Maybe I should be selling.

Problem is, it's an hourly chart.

It's probably a small move.

At best.

You're in an extraordinarily bullish uptrend as shown on the daily chart.

You don't want to try to short this.

I mean, really, it could go all the way down to thirty thousand and still be well-supported.

So the odds are just not in your favor.

And that's really what what trading is.

It's, you know, are the odds in your favor.

You know, you take the the, the odds in your favor trades and over the longer term you make more money.

So this to me isn't necessarily a sell signal, but the fact that we're right here at potential support

and if we can cross that, then I think that's a good sign.

You.

Have seen on the daily chart.

Go back to the daily here, you have seen where.

You profited from what is known as the squeeze know we're squeezing and then we're breaking back out.

The.

Market trading inside the bands now, this is it's easier to do on the daily chart, but you need some

type of lack of trend and that's just not the case right now.

But on the 30 minute chart, you can go back and forth.

You can see sell by, sell by.

If you sell it there, you're starting to see a break out of the bands that tells you that's not the

kind of trading you want to be doing anymore.

Now you're buying it on the dips.

So theory.

Add the Bollinger bands to this as well.

Notice how wide it has gotten after squeezing that tells you that.

Volatility is picking up.

Now, let's try to find some type of order in all of this, and I would say somewhere right around here,

there is going to be support or resistance.

So I'm going to mark this as 1500.

With the understanding that it probably based on what we've seen in the past.

Probably more.

Something like this.

And this happens.

It's probably like a fifty dollar thick support line.

Is the best way to put it.

So what I would be waiting for.

He's either a cross above the moving average now that we have bounced significantly, this this bar

is kind of a significant bar.

And we'll talk about that, it's something known.

When you do a candlestick, it's something known as a hammer.

So I'm looking for this fifteen hundred level to offer a bit of support, once you cross the moving

average, the median, then you're looking to probably aim towards the other side.

And then at that point, you can make a decision to take profit or you can make a decision to ride it

out until we break through the bottom of the Bollinger band again.

So.

If you really want a day trade back and forth, you can, but again, I would highly recommend that

you just stick with the longer term trend if you are going to do that.

Depending on where you're trading, crypto can be difficult to trade data because the spreads can be

wide and want to say day trader, I mean in and out in a matter of minutes.

It's one thing to hold on to it for eight hours.

It's another thing to hold on to it for eight minutes.

This is just a strong uptrend.

I mean, every time he came back to the moving average, the middle part, you could have been a buyer.

Pretty straightforward, pretty tight.

You know, here's that squeeze again, and you can see once you start breaking out of the Bollinger

Band, yes, it is a little overdone, but we find support again right at the median.

Walk it right back up.

So again.

That's pretty strong, and like I said, most of the time, your stop loss is going to be on the other

side of the band.

So if you break out, your stop loss goes on the other side and that's OK, because when you get a move

like this.

Although the stop loss might be a little bigger, a little farther distance.

Then you're comfortable with the reality is, is when you get a move like this, it typically signifies

something bigger, so you're aiming for more.

If you put your stop loss on the other side of the indicator, you didn't get stopped out, you know,

you got in somewhere around here, your original stop loss was right in this area.

You got stopped out up here.

You know, poke down there, probably took you out.

Pretty straightforward, you know, some people will just go back and forth and the band's nonstop,

but over time you'll learn that following the higher time frame trend is going to be by far your best

friend.

I mean, yes, you could have made money selling a theory and at that point.

But the reality is that every time it pulls back like that, the move higher is much bigger.

So really, you know, you don't need to capture every move.

You just need one or two good moves to make a nice return.

So I would definitely pound that into your head.

And the next video, we'll talk about how to trade with trend based indicators and how to trade based

upon trend following indicators.