Best Bollinger Bands for 4 Hour Stock Indices Chart
Adding MetaTrader 4 Bollinger Bands Indicator
Step 1: Open Navigator Window Panel on Indices Trading Software
Open Navigator panel as illustrated and shown below: Navigate to 'View' menu (click it) and then choose 'Navigator' window (click), or From Standard Toolbar click on 'Navigator' button key or press short-cut key-board keys 'Ctrl+N'
On Navigator window, choose 'Technical Indicators', (Double-Click)
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Adding Bollinger Bands MetaTrader 4 Indicator
Expand the menu by clicking the expand button marker (+) or double click the 'indicators' menu, after this the button will appear as (-) and will now display a list as shown below - select the Bollinger Bands indicator from this list of indices indicators so that to add the Bollinger Bands indicator on the stock indices chart.
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How to Setup Bollinger Bands Stock Indices Indicator MetaTrader 4
If the technical indicator you want to add is a custom Bollinger Bands indicator - for example if the Bollinger Bands technical indicator you want to add is a custom indicator you will need to first add this custom Bollinger Bands indicator on the MetaTrader 4 software & then compile the custom Bollinger Bands indicator so that the newly added Bollinger Bands custom indices indicator pops up on the list of custom indicators on the MetaTrader 4 software.
To learn how to install Bollinger Bands indicator on MetaTrader 4, how to add Bollinger Bands indicator panel to MT4 and how to add Bollinger Bands indices custom indicator in MT4 - How to add a custom Bollinger Band indices indicator in MetaTrader 4.
About Bollinger Bands Stock Indices Technical Indicator Guide
Bollinger Bands Technical Analysis & Bollinger Bands Stock Indices Signals
Bollinger bands are made up of three lines. The middle line is a Moving Average - 20 stock indices price period Simple Moving Average.
Bollinger bands trading indicators are then plotted at a distance away from the moving average technical indicator. These are bands which form the lower & upper lines.
The distance where the bands are drawn is decided by another indicator called the standard deviation. Standard deviation is a measure of stock indices price volatility in the stock indices market.
Since the stock indices price volatility keeps on changing, the standard deviations will keep varying, and since Bollinger bands are drawn using the standard deviation the distance of the Bollinger bands will keep on adjusting themselves to the indices market volatility.
When the indices trading prices become more volatile, Bollinger Bands widen - Bollinger Bands contract during the less volatile periods.
The Three Bollinger Bands are designed to encompass the majority of a indices price action movement. The middle Bollinger Band forms the basis for the indices trend, typically a 20 stock indices price period simple moving average.
This middle Bollinger Band also serves as the base for the upper and lower Bollinger Bands. The upper Bollinger band's and lower Bollinger band's distance from the middle Bollinger band is determined by stock indices trade price volatility. The upper band is drawn above the middle band at +2 standard deviations while the lower band is drawn below the middle band at -2 standard deviations.
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Bollinger Bands Technical Analysis and How to Generate Stock Indices Bollinger Bands Signals
- Bollinger Bands provide a relative definition of high and low of indices price
- Bollinger Bands are used to spot periods of high and low volatility
- Bollinger Band are used to identify periods when the prices are at extreme zones
Bollinger Bands Consolidation
Bollinger Band tighten as volatility lessens, this identifies the periods of stock indices price consolidation. Sharp stock indices trading price break outs tend to occur after the Bollinger Bands indicators tighten.
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Bollinger Band Continuation Trading Signal
If indices prices break through upper or lower Bollinger Bands indicator and move outside the Bollinger Band a continuation of the current indices trend is expected.
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Bollinger Bands Reversal Trading Signals
Bottoms & tops made outside the Bollinger Bands followed by bottoms & tops made inside the Bollinger Bands signals for indices reversals in the indices trend
The Bollinger Bands Head Fake
Traders should be on the lookout for false breakouts known as Bollinger Bands whipsaws or Bollinger Bands head fakes.
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Indices Price often breaks out in one direction immediately following the Bollinger Bands Squeeze causing many stock indices traders to think the stock indices price breakout will continue in that direction, only for stock indices price to quickly reverse and make the true and more significant stock indices price break out in opposite direction.
Traders acting quickly on the initial stock indices price break out often get caught on the wrong side of the stock indices price action - while those traders expecting a "false breakout" can quickly closeout their original indices trade positions & enter a trade in direction of the stock indices price reversal. It's always good to combine Bollinger bands indicator with other confirmation indices indicators.
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