First, the basic knowledge

1. What is the Bollinger Band like?

BOLL index, also known as bollinger band index, consists of three lines, namely upper rail line, middle rail line and lower rail line.

The upper and lower lines can be regarded as the pressure line and support line of the stock price respectively, and there is an average line of the stock price between the two lines.

2. What is it made of?

Yellow line on the upper rail-boll line: resistance line.

The white line of the middle rail-BOLL line: the stock price average line.

The purple line of the lower rail-BOLL line: the support line.

3. The role of the bollinger Band:

1) bollinger bands can indicate support and pressure positions;

2) The bollinger Band can show overbought and oversold;

3) Bollinger bands can indicate trends;

4) Bollinger Bands have the function of channels.

4. What market can be used to judge (shock, trend, median line, short line)?

Compared with other indicators, it is the most accurate in volatile market, but it is not so applicable in unilateral market ups and downs. It is a medium-and long-term technical analysis tool to judge the trend of stock price movement.

Bollinger Band parameters:

In the domestic market software, the parameter value of the middle rail of the Bollinger Band is mostly "26" by default. If the value is larger, the distance between the upper rail and the lower rail of the bollinger Band will become larger. If it is too large, it will lose the opportunity of short-term operation, and there is no obvious signal when the amplitude is small. Therefore, it is suggested to modify the period to "20", that is, the bollinger band makes predictions around the 20-year moving average.

Second, how to use it?

Basic usage:

(1) Up, Middle and Down Trajectory of Cotton Boll:

The operating range of the price channel formed by the upper, middle and lower rails in 1 and BOLL indicators is uncertain. Under normal circumstances, the market price should always run in the price channel. If the market price runs out of the price channel, it means that the market is in an extreme state.

2. When Brin runs up with the upper and lower rails at the same time, it shows that the market power is very obvious and will continue to rise in the short term, so we must resolutely hold multiple shares. On the contrary, it shows that the weak characteristics of the market are very obvious and will continue to fall in the short term. Investors should resolutely short.

3. When the upper rail line of the bollinger band runs downward, and the middle rail line and the lower rail line run upward, it indicates that the market is in a consolidation situation. If the market is in a long-term upward trend, it means that the market is in a strong consolidation on the way up; If the market is in a long-term downward trend, it means that the market is a weak consolidation on the way down.

4. When the upper, middle and lower rails of the bollinger Band run horizontally almost at the same time, it should be judged according to the current market trend:

When the current market has been in a long-term decline, it shows that the stock price is in the bottoming stage, and it is possible to start to build more positions in batches. Once the three lines diverge upwards, we can increase our efforts.

At present, when the market is in a slight upward trend, it shows that the market is in the upward stage of consolidation, and investors can hold the upward trend or do more on dips. Once the three lines diverge upwards, you can add positions in the short term.

When the current market has just experienced a round of sharp decline, it shows that the stock price is in a downward consolidation stage, and it should be mainly short-selling and short-selling on rallies. Once the third line diverges downward, it will resolutely short.

(2) The "bell mouth" of the bollinger Band:

The "bell mouth" of the Bollinger Band is a method to judge the stock price trend according to the direction of the upper, middle and lower rails of the Bollinger Band. Named after the bell mouth, it is divided into three types: open bell mouth, closed bell mouth and tight bell mouth.

Turn on the horn-accelerate the ascent stage

Opening the bell mouth often appears in the early stage of short-term skyrocketing market, which is a trend when prices face upward changes after a long period of low-level sideways bottoming.

Once this happens, it indicates that the bulls are becoming stronger, the bears are gradually exhausted, a large-scale rebound is coming, and the price will be in a short-term sharp rise.

Angle reduction-accelerated fading stage

The convergent bell-mouth shape often appears in the early stage of the plunge market, which is the form of a sharp downward breakthrough in short-term prices.

It shows that the short-selling power becomes stronger and the long-selling power begins to fail, which means that the stock price has entered a downward trend. Once the big yinxian line effectively falls below the middle track, it must be sold in time to keep the income and reduce the big loss.

Although there is no requirement for the formation of convergent bell mouth shape, there must be a condition, that is, there must be a large short-term pull-up in the early stage of the stock price. The greater the pull-up, the greater the distance between the upper and lower rails, and the greater the future decline.

Closed Horn —— Bottom Building Stage of Horizontal Plate

A tight-lipped trumpet often appears at the end of a sharp drop in prices. The upper and lower rails of the bollinger band gradually move closer to the middle rail, and the distance between the upper and lower rails is getting smaller and smaller. At this time, the upper rail of the bollinger band is still running down, while the lower rail is slowly rising.

It indicates that the market adjustment is coming to an end and will be slightly consolidated.

Let's take Hite Hi-Tech as an example to explain it in detail:

Third, the advantages and disadvantages of the bollinger Band:

Advantages:

1, the passage of the bollinger band is very obvious, and the three tracks of the bollinger band will never cross.

2. In many cases, the success rate of trading with bollinger bands is far better than that with KDJ, RSI or even moving averages, because it is almost impossible for the banker to tamper with the bollinger bands. Therefore, using the bollinger band to trade can help us avoid the trap set by some bookmakers using technical indicators.

Disadvantages:

The accuracy of bollinger bands is very high in the market where the box oscillates sideways, but the accuracy of bollinger bands will drop slightly in the market with unilateral trend.

Matters needing attention in using bollinger bands

1. When using the bollinger Band, be careful to determine whether it is in the normal area or the abnormal area. In the abnormal area, we can't simply follow the principle of breaking the upper limit and buying the lower limit.

2. It is easy to catch bull stocks by narrowing the opening at the low position, but at the high position or once it shrinks, the stock price will break down and there will often be more room for decline.

In addition, the Bollinger Band can be used in conjunction with other indicators, and the effect will be better, such as volume and KDJ indicators.