Bollinger Bands is one of the strongest indicators that you can have on your charts, whether you trade currencies, stocks, cryptocurrencies, etc.
If you want to know about this indicator in detail, please read this article: Bollinger Bands in Forex and Stock Trading [With Detailed Pictures]
You can use Bollinger Bands in so many different ways. There are different trading systems that work based on Bollinger Bands. Almost all of them are great trading systems if you follow them properly.
One of these trading systems is based Bollinger Bands Squeeze: Bollinger Bands Squeeze: What Is It and How to Trade It?
Yesterday, we talked about this system with our members who have privilege access to our members area. Here, we share a small part of what we shared with them.
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Forming Bollinger Bands Squeeze on GBP/USD Daily Chart
Now, let me show you a Bollinger Bands Squeeze that formed in 2019 on GBP/USD daily chart, and then the one that is forming now.
As you see on the below chart, GBP/USD daily chart started going sideways from 2019.10.21. Therefore, Bollinger Upper and Lower Bands got close to each other and formed a Bollinger Bands Squeeze pattern.
After several days, the 2019.12.03 daily candlestick closed above the Bollinger Bands Squeeze resistance line, and that was the best time to go long, while you could place the stop loss, several pips below the low price of 2019.12.03 candlestick, and your target could x5 bigger than your stop loss size:
Now, it seems GBP/USD has started forming another Bollinger Bands Squeeze. We have to wait and see…
Do you know how to trade the above forming Bollinger Bands Squeeze?
Please leave a comment and explain 🙂