{"id":48671,"date":"2024-02-02T11:25:53","date_gmt":"2024-02-02T10:25:53","guid":{"rendered":"https:\/\/www.captrader.com\/?post_type=glossar&#038;p=48671"},"modified":"2024-04-04T17:50:13","modified_gmt":"2024-04-04T15:50:13","slug":"bollinger-bands","status":"publish","type":"glossar","link":"https:\/\/www.captrader.com\/en\/glossar\/bollinger-baender\/","title":{"rendered":"Bollinger Bands"},"content":{"rendered":"<p class=\"wp-block-paragraph\">Bollinger Bands are used as a technical indicator in chart analysis and are a tool developed by John Bollinger. They are used by private and professional investors. In this article you will learn what exactly Bollinger Bands are and what they can be used for.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Bollinger Bands Explanation<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The Bollinger Bands use the <strong>Standard deviation <\/strong>from the statistics. They are based on the <strong>moving average<\/strong> of the last 20 days. This utilizes the idea that in a normal distribution, a set of values only deviates from the mean by a certain amount with a certain probability.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This means that certain outliers are neglected and all other values are within a certain range, which is also known as the <strong>Gaussian normal distribution<\/strong> is called.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The moving average is the middle of 3 bands. There is also an upper Bollinger band and a lower band. The upper one indicates an expensive level, the lower one a favorable one. During volatile times, the <strong>Distance <\/strong>of the two Bollinger Bands, relatively small during resting phases.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Bollinger Bands Interpretation<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">In principle, the Bollinger Bands in the <strong><a href=\"https:\/\/www.captrader.com\/en\/blog\/earn-money-with-day-trading\/\">Day trading<\/a> <\/strong>can be used. You can help with this, <strong>Trading strategies<\/strong> and develop them. They are also used to interpret the movement of the market, known as price action.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Traders use the Bollinger Bands, for example, to determine the point at which a position should be closed. If the price of a security falls below the lower Bollinger band, this is referred to as a <strong>Sell signal <\/strong>considered. Conversely, if the price is above the upper Bollinger Band, a <strong>Buy signal <\/strong>before.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">However, it is also possible to act in the opposite direction and <strong>possible turning points<\/strong> of the price trend. Subsequently, a <a href=\"https:\/\/www.captrader.com\/en\/glossary\/stop-loss-order\/\">Stop-loss order<\/a> which should not be too far from the entry level, but not too close either.\u00a0<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Especially when the Bollinger Bands are very <strong>steep <\/strong>it makes sense to open a position. The upper band should rise steeply and the lower band should fall.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Conclusion: Bollinger Band Trading<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">This is a technical <strong>Indicator from the chart analysis<\/strong>which day traders, for example, can use to optimize their <strong>Strategies <\/strong>to develop. The standard deviation is utilized in the process.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Shown are <strong>3 tapes<\/strong>The moving average, the upper and lower Bollinger bands. The bands can be used as <strong>Buy or sell signal<\/strong>when the price is above the upper or below the lower band. Traders also try to identify possible turning points with the help of Bollinger Bands.<\/p>","protected":false},"author":20,"featured_media":0,"template":"","class_list":["post-48671","glossar","type-glossar","status-publish","hentry"],"acf":{"blog_summary":"","blog_faq_schalter":"nein","faq_uberschrift":"","blog_faq_loop":null},"_links":{"self":[{"href":"https:\/\/www.captrader.com\/en\/wp-json\/wp\/v2\/glossar\/48671","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.captrader.com\/en\/wp-json\/wp\/v2\/glossar"}],"about":[{"href":"https:\/\/www.captrader.com\/en\/wp-json\/wp\/v2\/types\/glossar"}],"author":[{"embeddable":true,"href":"https:\/\/www.captrader.com\/en\/wp-json\/wp\/v2\/users\/20"}],"wp:attachment":[{"href":"https:\/\/www.captrader.com\/en\/wp-json\/wp\/v2\/media?parent=48671"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}