Bollingerbandsareapowerfulindicator.AfterusingBollingerbandsforover10yearsinIhavesome powerfulinsightthatwillallowyoutoentertradesmorepreciselywithlessrisk,stayintradeslonger thataregoingtocontinuetomove,ANDexttradeswithsuchprecisionthatyouwillliterallymoretimes thannotgetoutonahighEXACTLYwherepricebeginstogoagainstyou. Willitalwaysgothiswayforyou?NO,butIcancertainlysaywith110%confidencethatthesesimple trickswillallowyoutoexperiencealevelofaccuracythatwillshockyoufromtimetotime.Ican remember100'softrade,bothentriesandexitswhereBollingerbandsgotmeintothedegreethatI was100%confidentofamoveinmyfavorandexitswhereIwasabsolutelycertainthatpricewasDONE moving.SomanytimeswhenIgotoutIwatchedpricejustrocketagainstme,butbecauseofthe accuracyBollingerbandsallowedIwasalreadyoutofthetradewithMAXIMUMprofit. Thereisn'ttoomanyindicatorsthatwillallowyouthiskindofaccuracy.InfactIcan'tthinkof1single indicatorthatwillallowyouthistypeofprecision. Thismanualisintendedtobeshortandtothepoint.IwillcoverthebasicsAGAINshortandtothe point,andthenwewillgetintotheadvancedstuffthatyouwon'tfindanywhereelse. ThetechniquesthatIwillsharewithyouhereIhavebeenusingforseveralyears.

AlthoughIhavebeen usingBollingerbandsforover10yearsIreallydidn'tharnessthepoweruntilrecently.Youhavetoget beyondtheBollingerbandsqueeze,andBollingerbandcontractiontotrulyrealizethepowerofthis incredibleindicator. SoweshouldfirstthankJohnBollingerforcomingupwithwhatjustmightbethebestindicatorever developed,becauseItrulybelieveitisthebestindicatorIhaveeverused. IwouldliketoaddbeforewestartthattherearetimesandsituationwhereBollingerbandscanbeused alone,alwayswithadditionofaMEANormovingaveragethatdefinestheMIDPOINTbetweenthe bands.Usuallya21periodmovingaverage.Thismovingaverageisoftenadefaultadditiontothe bandsbutsometimesyouhavetoaddit. Thatsaid,YESyoucanusethebandswitha21periodmovingaveragebythemselvesformanygreatset upsbuttheadditionofanindicatorortwocangreatlybenefityouandyouraccuracy. IwillcoverwithyousomedetailsonhowIcreatemycashflowthroughmytradingwithBollingerbands andafewothertools. Solet'sgetstarted...

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BollingerbandsTheBasics
Let'sstartbydefiningBollingerbandsandtheirdefinedpurposeforexisting. HereisWikipedia'sdefinitionofBollingerbandsBollingerBandsisatechnicalanalysistoolinventedby JohnBollingerinthe1980s.Havingevolvedfromtheconceptoftradingbands,BollingerBandscanbe usedtomeasurethehighnessorlownessofthepricerelativetoprevioustrades. Nowit'sagoodthingwearen'trelyingonWikipediaforanyinsightintoBollingerbandsbecausethat's aboutthelamestexplanationofBollingerbandsI'veeverheard. AccordingtoWikipediaagainhereisthe"Interpretation"ofhowtouseBollingerbandsandthis explanationinitselfpresentsanewproblem...

************************* The use of Bollinger Bands varies widely among traders. Some traders buy when price touches the lower Bollinger Band and exit when price touches the moving average in the center of the bands. Other traders buy when price breaks above the upper Bollinger Band or sell when price falls below the lower Bollinger Band.[3] Moreover, the use of Bollinger Bands is not confined to stock traders; options traders, most notably implied volatility traders, often sell options when Bollinger Bands are historically far apart or buy options when the Bollinger Bands are historically close together, in both instances, expecting volatility to revert back towards the average historical volatility level for the stock. When the bands lie close together a period of low volatility in stock price is indicated. When they are far apart a period of high volatility in price is indicated. When the bands have only a slight slope and lie approximately parallel for an extended time the price of a stock will be found to oscillate up and down between the bands as though in a channel. Traders are often inclined to use Bollinger Bands with other indicators to see if there is confirmation. In particular, the use of an oscillator like Bollinger Bands will often be coupled with a non-oscillator indicator like chart patterns or a trend line; if these indicators confirm the recommendation of the Bollinger Bands, the trader will have greater evidence that what the bands forecast is correct. ************************* Additionally this is a clip from John Bollinger's website http://www.Bollingerbands.com Bollinger Bands are a technical trading tool created by John Bollinger in the early 1980s. They arose from the need for adaptive trading bands and the observation that volatility was dynamic, not static as was widely believed at the time.
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The purpose of Bollinger Bands is to provide a relative definition of high and low. By definition prices are high at the upper band and low at the lower band. This definition can aid in rigorous pattern recognition and is useful in comparing price action to the action of indicators to arrive at systematic trading decisions. Bollinger Bands consist of a set of three curves drawn in relation to securities prices. The middle band is a measure of the intermediate-term trend, usually a simple moving average, that serves as the base for the upper band and lower band. The interval between the upper and lower bands and the middle band is determined by volatility, typically the standard deviation of the same data that were used for the average. The default parameters, 20 periods and two standard deviations, may be adjusted to suit your purposes. ********************************

TheRealLowDownonBollingerBands
Iwantedyoutohavesomeinsightinwhat"others"sayaboutBollingerbandsandIalso recommendanyonewantingtoreallystudyBollingerbandstobuyJohnbookonBollinger bandsbecauseheistheinventorofthebandsandthereissomegoodinsightintothebook. Ifyoujustwantthe"GOLDENNUGGETS"thestuffthat'sgoingtomakeyoumoneyconsistently thenjustcontinuewiththisreportandtheemailsthatfollowaswellasthevideos,andyoumy friendwillknowmoreaboutgeneratingprofitswithBollingerbandsthan99%ofall experiencedtraders. Tobeginwithweneedtotalkaboutthe2BollingerbandSTAPLES.TheROOTofBollinger bands.TheBollingerbandSQUEEZE,andEXPANSION. WeareonlytrulyinterestedinEXPANSION,butaSQUEEZEtellsusofacomingEXPANISON, becauseinordertoEXPANDweneedtoCONTRACTorSQUEEZE. It'stheEBBandFLOWofBollingerbands. ASQUEEZEisreallytheresultofaslowinpricevolatility.Inotherwordswhenpricebeginsto SLOWDOWNit'sdaytodayMOVEMENTorVOLATILITYBollingerbandsbeginstoSQUEEZEto reflectthis.Thebandswillnarrowandthisindicates,let'sjustsay,deadpriceaction.Pricecan becomestagnant.Whenpricedoesthisit'shardtomakemoney,HOWEVERitalsopointsto thefactthatandEXPANSIONofvolatilityorMOREAGGRESSIVEpricemovementisinevitable. Infactandalwaysrememberthis,AFTERASQUEEZCOMESEXPANSION.FurtherDECREASED VOLATILITYBEGETSINCREASEDVOLATILITY.

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Thisisanimportantobservationbecauseitisafactthatalowvolatilityenvironmentisalways followedbyahigherone.Youjustneedtoknowhowtotakeadvantageofwhatfollowslow volatility. Let'slookfirstataBollingerbandSQUEEZEandExpansion

Figure1

Infigure1wehaveaBollingerbandsqueezeaswellasexpansion.Noticethatpriortothesqueeze price,foralmost1fullmonthreallysloweddownandremainedwithinaverynarrowpricerange,then thebandscametoaheadclosinginoneachotherandpriceEXPLODEDtotheupsideandcontinuedto rocketupward.ThisisatypicalpictureofBollingerbandssqueezingandexpanding.Theopportunityof courseliesintheexpansion. NowonethingtomakenoteofisthataBollingerbandexpansionNEVERdictatesDIRECTIONjust MOVEMENT.Inotherwordsthiscouldhavejustaseasilyexplodedtothedownsideasitdidtheupside. Moreonthislater. WhenIreallybegantouseBollingerbandstoanextremelyaccuratelevelwaswhenIrealizedthatit's notjustaboutexpansionorcontraction,it'sabout...

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HowtheBandsReactToApproachingPriceAction!
andnotjustthebandthat'sbeingapproached.it'saboutwhatBOTHBANDSdoasprice approacheseitherband.I'mgoingtousethesameimageabovetodemonstratetheKEEN INSIGHTBollingerbandsoffersinthissimpleexample.

Figure2

Noticeaspricemoveddowntotheredcirclethelowerbandmovedwithit.Bothheadeddownward eversoslightly.Thenattheredcircle,BEFOREtheexplosioninprice.ThelowerbandhookedUPWARD. IcallthistheBRICKWALLofBollingerbands.Thisclearlytoldusthatfornowatleast,priceWASNOT goingdownanyfurther. Payattentiontothis,it'sveryimportantandveryreliableineitherdirection.Noticethatitwasactually 3barsbackthatthelowerbandstartedtoflattenoutandSTOPPEDgoingdown.Thenwhenpricehitthe banditMARKEDTHEENDofthemovedown. Nowkeepinmindthatsometimespriceisn'tsoclosetothebandwhenthishappenssoIhavearuleof thumbtokeepinmind. 5|P a g e Copyright2011MTDInc. AllMySecretsareherehttp://www.3stepislandtrader.com

TheCloserPriceIsTotheBand(Whicheverband)TheMore AccurateYourReading.
Inthiscasepricewasrightontopofthelowerbandattheredcircle. IwouldnowliketointroduceyoutoashortcutchartImadetohelpyouinterpretthevaryingBollinger bandsignals.

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Figure3

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 Let'stakealookateachoftheseindicationsfromBollingerbandsona1by1basisbecauseifyougetto knowthemallintimatelyyouwillbecomeatoptraderanyassetclassanytimeframefromanyplaceon theplanet.FromNewYorktoBangladesh!

Figure4

Takeacloselook.Bollingerbandscouldbedoinganumberofthingsontheleft,traversingsideway slightlybearish,itcouldevenbeslightlybullish,thebottomlineisthebandsgotrealclose(contraction) andthentheybothexpandedtothepointofaNORTHandSOUTHboundalmostverticalbandonthe TOPandBOTTOM.Thisisextremelybullish.

Figure5

Thisistheoppositeoffigure4,extremelyBearish.Literallyjusttheexactoppositeasthefirstone.Price couldbedoingmanythingsuptothispoint,butrightherethebandsbegantocloseinoneachother first,andthenBAMrightherewegetaNORTHandSOUTHboundUPPERandLOWERband.Thisagainis atransitionfromlowvolatilitytohighvolatility. 8|P a g e Copyright2011MTDInc. AllMySecretsareherehttp://www.3stepislandtrader.com

Figure6

Infigure6priceismovingdowntoaBollingerbandthatwon't.ThisisasuresignthatFORNOWthe downwardmomentumisover.

Figure7

SamehereinFigure7,themoveupisHALTEDbyastubbornBollingerband.

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Figure8

Figure8isevenmorecertainthatFigures6&7.InFigure8theBollingerbandheadsuptoCUTOFFprice actiononitswaydown.Youcantradethissetupinmorewaysthan1!PriceisDONEatleastfornow.

Figure9

SameherewithFigure9,theupperbandcomesdownandheadspriceoffatthepass!Priceisnotgoing anywherebutdownforthetimebeing.

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Figure10

Herewehaveaslightlybearishstanceasthelowerbandheadsdownandtheupper,ratherthanexpand totheupsideandgiveustheexpansionweliketoseeremainsflat.Priceislikelytocontinuedown,just notaggressively.

Figure11

Figure11isthesameas10,butitsbullish.Pricewilllikelycontinueupinamoderatefashion.

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Figure12

Bothbandsheadeddownisclassicdownwardmomentum.Thesearethekindofmovesyouseewith bankstocksortrendingbluechiphighvolumemovers.IdeallywiththistypeofBollingerband momentumyoulooktoswingstructuretoidentifykeylowriskentrylevels.

Figure13

Thesamewithfigure13,looktoswingstructuretopinpointlowriskentryintothesemoderatetoslow movers. YouwillnoticethatIsay"ATLEASTFORNOW"alotaboutmostofthesesetups.Isaythatbecauseno matterhowgreatthesetuppricecanalwaysandoftendoeschangedirection.Yetnomatterhow muchthishappensIcanstillbesodarnaccuratewiththesesetupsthatitsalmostmagical.

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 Alwayskeepinmindasyouenteryourtradesthatalthoughyouwillberightmostofthetimepricecan alwaysturnonyou,that'swhyit'ssoimportanttokeepaneyeonswingstructure.Theswinghighsand swinglowstellyousomuchaboutoverallstrengthandweaknessregardingthetrend. Watchthoseswinghighsandlowsforcluesaboutyourtrade.CombineswingstructurewithBollinger bandsandyouwillhavetremendouspoweratfingertips.NoJoke! IfyouwanttolearnallmysecretsonBollingerbandsandswingstructure,aswellashaveaccesstoover 10webinarsonthesubjectIhavearrangedaveryspecialofferforyouhere http://www.3stepislandtrader.com Sincerely, PSIwillbeaddingexamplesofeach setuptothisreportsometimeinthe future.Iwillsendyouanemailto downloadtheupdatedversionatthat time.

MarkDeaton mark@renegadetrader.com 780FallsAve.#320 TwinFallsIdaho83301

U.S. Government Required Disclaimer - Commodity Futures Trading Commission Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the stock/options markets or forex. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to Buy/Sell futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed in this manual. The past performance of any trading system or methodology is not necessarily indicative of future results. CFTC RULE 4.41 - HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.
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