Options Bollinger Bands in PFOREX Assist
Ninety Sixth session – PFOREX Assist Tutorial
Welcome back to Forex professional training.
In this session we will review;
- Available Bollinger Bands types for Options trades
- The Bollinger Bands examples in PFOREX Assist
Bollinger Bands for Options (Call/Put)
The Bollinger Bands strategies deliver highly reliable continuation and reversal signals that are suitable for the Options market.
The confirmations for the Bollinger Bands strategies are so important to deliver higher reliable signals since higher confirmations will make trend movement faster to the Take Profit prices. The trend slope and amount of pips are critical in Options trades.
The available strategies that applied Bollinger Bands on the options signals are as follows;
- Bollinger Bands Divergence/Convergence Candlestick
- Bollinger Bands Hidden Divergence Candlestick
- Bollinger Bands Middle Line
- Bollinger Bands Bound
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BB DivCon Candle
When price passes the Bands and then return inside it, if Divergence/Convergence and reversal candlestick pattern show the reversal spot, then future trend is speculated.
The Bullish Format: When price crosses the Lower Band toward bottom and then return inside it while a Convergence and reversal bullish candlestick appear then the bullish signal is generated.
The Bearish Format: When price crosses the Upper Band toward top and then return inside it while a Divergence and reversal bearish candlestick appear then the bearish signal is generated.
The specifications of this strategy are as follows;
- Market type: Trend market
- Symbols: Entire symbols
- Time-frames: All timeframes
- Elements: Bollinger Bands, Divergence/Convergence and powerful Candlestick pattern
- Entry Price:
- Buy Order: Over the Lower Band with Convergence and Bullish Candlestick
- Sell Order: Below the Upper Band with Divergence and Bearish Candlestick
- Confirmations: Hidden Divergence, Overbought/Oversold by RSI or Stochastic
Now let’s check some examples of this strategy.
On the bearish trend of Gold chart, two last valleys were formed below the Lower Band. The Convergence is detected on the last valley considering these valleys by RSI indicator. Then price returned toward top and passed the Lower Band toward top by a powerful Engulfing candlestick pattern to confirm the reversal spot and bullish signal.
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In the next example, after price formed two peaks over the Upper Band, a Divergence is detected by RSI. Finally price bounced back toward bottom inside the Bands channel with powerful bearish candlesticks to confirm the downward trend.
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BB HD Candle
When price breaks the Bands and return inside the Bands channel near the Middle line, if Hidden Bullish/Bearish Divergence and a powerful reversal candlestick are detected then this strategy delivers signals.
Bullish format: When price returns toward the middle line after it passes the Upper Band toward top, if a Hidden Bullish Divergence and a Bullish Candlestick pattern form near the Middle line then bullish signal is generated.
Bearish format: When price returns toward the middle line after it passes the Lower Band toward bottom, if a Hidden Bearish Divergence and a Bearish Candlestick pattern form near the Middle line then bearish signal is generated.
The specifications of this strategy are as follows;
- Market type: Trend market
- Symbols: Entire symbols
- Time-frames: All timeframes
- Elements: Bollinger Bands, Hidden Divergence and powerful Candlestick pattern
- Entry Price:
- Buy Order: Near the Middle Line with Hidden Divergence and Bullish Candlestick
- Sell Order: Near the Middle Line with Hidden Divergence and Bearish Candlestick
- Confirmations: Divergence/Convergence, Overbought/Oversold by RSI or Stochastic
Now let’s check some examples of this strategy.
The AUDCHF price chart shows that the Upper Bands was crossed and then price returned by a Shooting Star candlestick until it reached the Middle Line. The Hidden Bullish Divergence by RSI on valley shows the area where price would follow the upward trend.
Also the price is in oversold condition. The Stochastic line passed the level 20 toward top while price formed bullish candlestick near the Middle line to confirm the reversal spot toward top.
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In the next example, the Oil price crossed the Lower Band and then it returned inside the channel until the Middle Line. A Dark Cloud candlestick in addition to Hidden Bearish Divergence area confirm the downward trend on the reversal spot near the Middle Line.
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BB Middle Line
When price bounces back toward Middle Line, then price may change the direction on the reversal spot near Middle line on which other confirmations shows the probable reversal trend.
Bullish format: When price returns toward the middle line after it passes the Upper Band toward top, if a Bullish Candlestick pattern forms near the Middle line then bullish signal is generated. If RSI line passes the level 30 or Stochastic line passes level 20 toward top then the signal is confirmed.
Bearish format: When price returns toward the middle line after it passes the Lower Band toward bottom, if a Bearish Candlestick pattern forms near the Middle line then bearish signal is generated. If RSI line passes the level 70 or Stochastic line passes level 80 toward bottom then the signal is confirmed.
The specifications of this strategy are as follows;
- Market type: Trend market
- Symbols: Entire symbols
- Time-frames: All timeframes
- Elements: Bollinger Bands, Candlestick, RSI & Stochastic
- Entry Price:
- Buy Order: Bullish Reversal spot near Middle Line
- Sell Order: Bearish Reversal spot near Middle Line
- Confirmations: Hidden Divergence and Fibonacci levels
Now let’s check some examples of this strategy.
On Brent char price, the Upper Band was passed and then price bounced back toward the Middle line again where the market is in oversold condition. Shooting Star candlestick near the Middle line confirmed the upward direction.
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The next example shows the bearish signal in which price passed the Lower Band and then returned near the Middle line. The reversal spot formed by a bearish candlestick.
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BB Bound
When price crosses the Band toward outside of the channel and then returns inside the Band again, if it bounces back toward that certain Band without crossing it then a reversal spot can be detected with confirmation by Divergence/Convergence, RSI, Stochastic and reversal candlestick pattern.
Bullish format: When price returns inside the channel after it passes the Lower Band toward bottom, if it decreases toward the Lower Band and a reversal spot with a bullish Candlestick pattern forms before the Lower Band then bullish signal is generated. If RSI line passes the level 30 or Stochastic line passes level 20 toward top then the signal is confirmed.
Bearish format: When price returns inside the channel after it passes the Upper Band toward top, if it increases toward the Upper Band and a reversal spot with a bearish Candlestick pattern forms before the Upper Band then bearish signal is generated. If RSI line passes the level 70 or Stochastic line passes level 80 toward bottom then the signal is confirmed.
The specifications of this strategy are as follows;
- Market type: Trend market
- Symbols: Entire symbols
- Time-frames: All timeframes
- Elements: Bollinger Bands, Candlestick, RSI & Stochastic
- Entry Price:
- Buy Order: Reversal spot over the Lower Band
- Sell Order: Reversal spot below the Upper Band
- Confirmations: Hidden Divergence and Fibonacci levels
Now let’s check some examples of this strategy.
On the GBPJPY, price crossed the Lower Band and then returned inside the channel. It again decreased but before crossing the Lower Band again a reversal spot is detected by a Piercing Line candlestick and a Convergence. RSI line passed the level 30 and Stochastic line passed level 20 toward top to confirm the bullish trend.
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In the next example, AUDUSD price crossed the Upper Band and bounced back inside the channel. After it increased toward the Upper Band again, a reversal spot was detected before the Upper Band by Divergence. The RSI line passed the level 70 and Stochastic line passed level 80 toward bottom to confirm the bearish signal.
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Notices
You can download PFOREX Assist app for iOS and other platforms devices to receive these signals instantly, however I have to insist that all the services provided PFOREX are as information, not as suggestion nor advice.
That concludes this session, until next time and another session, take care.