Understand Max Iwamoto's "Bollinger Bands" Part 4 [Max Iwamoto]
Max Iwamoto Profile
Keisuke Iwamoto. As the nickname “Technical Analyst with a middle school education” suggests, he is an analyst in an industry with almost no formal education required. Even in these days where educational background matters a lot, he tirelessly works with the FX market where such considerations don’t matter at all. With the feeling of “now that everyone can start FX easily, I want you to acquire skills that keep you winning steadily,” he serves as a lecturer for serial publications and seminars.
Three key points for practical use
When it comes to buying and selling signals of Bollinger Bands, the famous approach is to base on the characteristics of standard deviation (the probability that data falls within the range of ±3σ to ±1σ is 99.7% to 68.3%), selling on a +2σ touch and buying on a -2σ touch, but as explained in previous issues, that is incorrect.
With that in mind, there are three main points to pay attention to when using Bollinger Bands for market analysis. The first is the market direction through the mid band. The second is the magnitude of volatility from the band width of ±1σ to ±3σ. And the third is the relative price height viewed through standard deviation. The greatest appeal of Bollinger Bands is that they allow comprehensive market analysis based on these factors.
