Bollinger Bands are used to measure a market's volatility. It is a technical analysis tool that is comprised of three data points that together create an upper and lower trading channel (band) that are two standard deviations from the middle line.
Bollinger Bands measure mid-term trend. price fluctuations between the upper and lower bands measure volatility and deviation from the 20-day simple moving average.
In addition to the standard Bollinger bands, whose settings are 20 periods and two standard deviations, Double Bollinger Bands add on the 20 period, one standard deviation, so it creates four bands, or zones. The two bands on the top are known as the uptrend zone; the two bands on the bottom are known as the downtrend zone. So if the currency pair has a very strong uptrend, usually it will remain in the one-two band on the upside. If it’s in a downtrend and the downtrend is strong, it will be in the one-two band on the downside.
Double Bollinger Bands inform the trader whether a currency pair is in a trend or range, the direction of the trend and when the trend has exhausted. Additionally, Double Bollinger Bands identify entry points and proper places to put a stop.
The Double Bollinger Band trading system is the only trading system that uses two Bollinger Band indicators with different historical periods.
Earlier we learned a bit about
standard Bollinger Bands (hence BBs for short) as support/resistance indictors.
The key point was that they are useful S/R indicators only in flat or gently trending
markets, but not during strong trends.
Double
Bollinger Bands Definition
The Double Bollinger Bands
definition (or DBBs for short) is a powerful variation on the standard single
version because they tell us much more about momentum and hence trend strength,
both in flat and strongly trending markets. In fact, unlike standard Bollinger
Bands, they are exceptionally useful in strongly trending markets because they
help us to better understand:
- When a pair is in a trend or a trading range
- Whether a strong trend is likely to continue
- Low risk entry and exit points
As the name suggests, Double Bollinger Bands consist of 2 sets of BBs:
A set of BBs at the usual 2 standard deviation distance above and below the 20 period simple moving average line in the middle
and
A second set of BBs plotted just 1 standard deviation above and below that central moving average
These are just the usual default settings. Traders can, and do, tinker with the type and duration of the moving average, and the number of standard deviations.
Here is how to plot Double Bollinger Bands:
First, plot a standard set of BBs. Using a typical charting package that means going to your menu of technical indicators and just selecting Bollinger bands, along with the standard (2, 20) settings (which stand for 2 standard deviations and a 20 period simple moving average.
Then repeat the process by again selecting Bollinger bands from you list of available indicators, but this time change the settings from 2 standard deviations to 1 standard deviation.
That’s it. You may want to change the color of one of these sets of BBs, as well as the color of your central 20 period moving average, so that they’re easier to see among the other indicators that you may have on your chart.
Here is an illustration:
Here’s the same gold chart we saw in the last lesson:
Here’s that same chart with DBBs plotted on it:
Here’s a brief explanation of each
line.
- A1: The upper BB line that is two standard deviations away from line C, which is the 20-period simple moving average (SMA).
- B1: The upper BB line that is at a one standard deviation distance from the 20-period SMA.
- C: The 20-period simple moving average (SMA). Figure 8.2 is a weekly chart, so this is a 20-week
SMA. Again, this is both the center
of the Double Bollinger Bands and baseline for determining the location of the
other bands.
- B2: The lower BB line that is one standard deviation from the 20-period SMA.
- A2: The lower BB line that is two standard deviations from the 20-period SMA.
These bands mark three separate
zones. These zones provide the added information about the strength of a trend.
In other words, even if there is no other S/R to serve as a reference point (as was the case with gold until late 2011), when price enters one of these zones, we have a better idea of whether price is likely to
In other words, even if there is no other S/R to serve as a reference point (as was the case with gold until late 2011), when price enters one of these zones, we have a better idea of whether price is likely to
- Continue its trend
- Halt its trend and stay within a horizontal trading range
- Or, reverse direction
We’ll look more closely at these 3 zones and their meaning in the next article.
The Double Bollinger Band Trading
System is a strategy for trading. When a trader is in a highly volatile market
environment, Double Bollinger Bands help the trader to identify whether or not
he is in a trend. If he is, it’s a good idea for him to look for opportunities
to join that trend or he can go ultra-short term where he would be staying in a
position for no more than a couple of hours.
Double Bollinger Band indicators
give the trader a heads up on the right time to buy or sell Forex. When viewing
a graph with Double Bollinger Bands, a trader must keep in mind that the two
Bollinger bands on the top are often referred to as the uptrend zone; the two
Bollinger bands on the bottom as the downtrend zone.
So if the currency pair has a very
strong uptrend, usually it will remain in the one-two band zone on the upside.
If it’s in a downtrend and the downtrend is strong, it will be in the one-two
band zone on the downside.
When it comes out of that zone,
however, and when it goes from the downtrend into the range-trading zone—the
middle space—that is an indication that the trend is breaking.
There are four rules for using
Double Bollinger Bands:
Rule 1: Go short when price is in or
below the DBB sell zone.
Rule 2: Go long when price is in or
above the DBB buy zone.
Rule 4: Minimize risk by waiting
until price retraces to the cheaper end of the buy or sell zone or takes
partial positions.
As noted in the last lesson, two sets of Bollinger bands
create three zones. Using a Double Bollinger Bands indicator to predict price
movements can be tricky.
Let’s look at the chart below:
Let’s look at the chart below:
The DBB Buy zone: When a price is
within this upper zone (between the two topmost lines, A1 and B1), that implies
strong upward momentum and that the uptrend is more likely to continue.
Rule: When candles continue to close in this uppermost zone, that’s a signal to enter or maintain long positions, as well as to avoid short positions and to close any remaining shorts still open.
The DBB Sell zone: When the candles remain in the bottom zone (between the two lowest lines, (A2 and B2), that suggest strong downward momentum and that the downtrend will probably continue.
Rule: When candles continue to close in this sell zone, that’s a signal to enter or maintain short positions, as well as to avoid long positions and to close any remaining open long positions.
The DBB Neutral zone: When price is within the area bounded by the one standard deviation bands (B1 and B2), that means there is no strong momentum or trend.
Rule: Typically one to three consecutive candles closing in this area are your signal to exit any trades that are riding the current up or down trend, because that trend is showing weakness.
In other words, when a price makes a sustained move into the neutral zone, that’s a signal to:
Rule: When candles continue to close in this uppermost zone, that’s a signal to enter or maintain long positions, as well as to avoid short positions and to close any remaining shorts still open.
The DBB Sell zone: When the candles remain in the bottom zone (between the two lowest lines, (A2 and B2), that suggest strong downward momentum and that the downtrend will probably continue.
Rule: When candles continue to close in this sell zone, that’s a signal to enter or maintain short positions, as well as to avoid long positions and to close any remaining open long positions.
The DBB Neutral zone: When price is within the area bounded by the one standard deviation bands (B1 and B2), that means there is no strong momentum or trend.
Rule: Typically one to three consecutive candles closing in this area are your signal to exit any trades that are riding the current up or down trend, because that trend is showing weakness.
In other words, when a price makes a sustained move into the neutral zone, that’s a signal to:
- Exit trend based trades
- Consider range - trading strategies. That is, entering long positions at the bottom of the trading range, closing them as price reaches the upper end of that range, and then opening short positions to ride the move back to the lower end of the trading range.
Notice how we phrase these rules. We didn’t say something like: “when price is in zone X, do Y.” Rather we stuck to wording like: “when price is in zone X, that’s a signal to do Y.”
Here is a reminder: Never trade based on just one indicator, even if it is a Double Bollinger Bands indicator!
We generally would not enter a long position just because the price is hitting support, nor would we usually open a short position just because price is hitting resistance.
Similarly, we wouldn’t enter or exit positions solely based on DBBs signals.
You should generally not make entry or exit decisions based on just one technical indicator such as the Double Bollinger Bands indicator. The above signals must always be considered together with:
Other technical indicators: Look for confirmation from different kinds of indicators that it’s a good time to enter or exit a position. Similarly, if there are conflicting signals from other indicators besides the Double Bollinger Bands indicator, we might wait until the picture becomes clearer.
For example, if price enters the buy zone, but we know that a strong resistance area is just above the current price, we might wait until the pair makes a decisive break above that resistance before entering a new long position. How long we wait is often a decision based on how we prioritize risk versus reward. The sooner we enter, the larger our potential profits if we’re correct, and the higher our risk of entering too soon and suffering a loss from a “false breakout.
If the EURUSD moves into the buy zone but we suspect that the ECB might announce an interest rate cut at its monthly meeting and rate statement later in the week (which would likely drive the pair lower) we might ignore the technical entry signals and wait until that event passes.
We’ll discuss later the number and types of technical indicators we want to use in combination.
Forex traders typically watch at
least one major stock index that’s open during the times they trade, because it
will tell them a lot about how a given pair is moving. When stock indexes are
rising, so should risk pairs, while safe haven pairs should be falling. There
are other useful barometers of overall market risk sentiment too, but we’ll
cover those another time.
Rule 1: When candles continue to
close in the DBB sell zone, that’s a signal to enter or maintain short
positions, as well as to avoid long positions and to close any remaining open
long positions. When price moves above this zone, it’s time to consider exiting
short positions.
Rule 2: When candles continue to
close in the uppermost zone, the DBB buy zone, that’s a signal to enter or
maintain long positions, as well as to avoid short positions and to close any
remaining shorts still open. When price moves below this area, it’s time to
consider exiting long positions.
Many of you may be wondering why we’re using a chart of a
stock index and not using a chart of a currency pair. There are a few reasons.
First, the following rules apply to charts of any financial asset traded in a highly liquid market. Therefore a chart of the S&P 500 index illustrates the following rules as well as any currency pair chart.
Secondly, using the chart of the S&P 500, the #1 stock index (by market capitalization) in the world, allows me to introduce an important point.
Major global stock indexes are excellent barometers of risk appetite (optimism, or greed) or risk aversion (pessimism, or fear). Therefore they provide an excellent, quick summary of how most currency pairs should be moving.
Remember what we said earlier in the introductory part of this course about risk and safety currencies, and currency pairs.
• Because some currency pairs move in the same direction as risk assets like stocks, and some move in the opposite direction, major global stock indexes (which are meant to summarize a given national or regional stock market for companies of a given type or size) provide a great single picture of how most currency pairs should be moving
• As discussed earlier, currency pairs in which the base currency (the one on the left) is higher on the risk spectrum than the quote or counter currency (the one on the right) it is considered a “risk pair” because it will move in the same direction as risk assets, such as stocks, major global stock indexes, or industrial purpose commodities like oil, copper, or iron ore. A few popular examples are the AUDJPY or EURUSD.
• If the base currency is lower on the risk spectrum than the quote or counter currency, it is a “safe haven pair,” and the pair will move in the opposite direction of stocks, risk currency pairs, and other risk assets. These include such pairs as the EURAUD, USDCAD, or GBPAUD
So Forex traders typically watch at least one major stock index that’s open during the times they trade, because it will tell them a lot about how a given pair is moving. When stock indexes are rising, so should risk pairs, while safe haven pairs should be falling. There are other useful barometers of overall market risk sentiment too, but we’ll cover those another time.
It is important to remember: You can always ride downtrends using currency pairs.
As we said earlier in the introduction to the course, when stock markets are plunging hard during a crisis, stock exchanges often ban short selling. It’s impossible to ban the shorting of risk currency pairs because:
• Currencies trade in pairs: if you ban the sale of one currency, you ban the trading of any currency pair that includes it
• There are no centralized currency exchanges: instead there are numerous networks of banks and individual brokers spread across the world.
Therefore, you can always sell risk currency pairs during strong bear markets as a way to profit from general risk asset market downturns, or to hedge long positions in risk assets such as stocks, commodities, stock indexes, etc.
There are four rules of double Bollinger bands:
Rule 1
When candles continue to close in the DBB sell zone, that’s a signal to enter or maintain short positions, as well as to avoid long positions and to close any remaining open long positions.
When price moves above this zone, it’s time to consider exiting short positions.
Here’s an example of that situation:
First, the following rules apply to charts of any financial asset traded in a highly liquid market. Therefore a chart of the S&P 500 index illustrates the following rules as well as any currency pair chart.
Secondly, using the chart of the S&P 500, the #1 stock index (by market capitalization) in the world, allows me to introduce an important point.
Major global stock indexes are excellent barometers of risk appetite (optimism, or greed) or risk aversion (pessimism, or fear). Therefore they provide an excellent, quick summary of how most currency pairs should be moving.
Remember what we said earlier in the introductory part of this course about risk and safety currencies, and currency pairs.
• Because some currency pairs move in the same direction as risk assets like stocks, and some move in the opposite direction, major global stock indexes (which are meant to summarize a given national or regional stock market for companies of a given type or size) provide a great single picture of how most currency pairs should be moving
• As discussed earlier, currency pairs in which the base currency (the one on the left) is higher on the risk spectrum than the quote or counter currency (the one on the right) it is considered a “risk pair” because it will move in the same direction as risk assets, such as stocks, major global stock indexes, or industrial purpose commodities like oil, copper, or iron ore. A few popular examples are the AUDJPY or EURUSD.
• If the base currency is lower on the risk spectrum than the quote or counter currency, it is a “safe haven pair,” and the pair will move in the opposite direction of stocks, risk currency pairs, and other risk assets. These include such pairs as the EURAUD, USDCAD, or GBPAUD
So Forex traders typically watch at least one major stock index that’s open during the times they trade, because it will tell them a lot about how a given pair is moving. When stock indexes are rising, so should risk pairs, while safe haven pairs should be falling. There are other useful barometers of overall market risk sentiment too, but we’ll cover those another time.
It is important to remember: You can always ride downtrends using currency pairs.
As we said earlier in the introduction to the course, when stock markets are plunging hard during a crisis, stock exchanges often ban short selling. It’s impossible to ban the shorting of risk currency pairs because:
• Currencies trade in pairs: if you ban the sale of one currency, you ban the trading of any currency pair that includes it
• There are no centralized currency exchanges: instead there are numerous networks of banks and individual brokers spread across the world.
Therefore, you can always sell risk currency pairs during strong bear markets as a way to profit from general risk asset market downturns, or to hedge long positions in risk assets such as stocks, commodities, stock indexes, etc.
There are four rules of double Bollinger bands:
Rule 1
When candles continue to close in the DBB sell zone, that’s a signal to enter or maintain short positions, as well as to avoid long positions and to close any remaining open long positions.
When price moves above this zone, it’s time to consider exiting short positions.
Here’s an example of that situation:
It’s just a zoomed-in look at the far-left part of the chart that we saw at the beginning of this lesson. Study the period of September 7 to December 14th. It’s bounded by the downward pointing arrow in the upper left part of the chart, and by the upward pointing arrow which is on the lower right.
Per rule 1, the odds favored shorting the index.
Rule 2
When candles continue to close in the uppermost zone, the DBB buy zone, that’s a signal to enter or maintain long positions, as well as to avoid short positions and to close any remaining shorts still open.
When price moves below this area, it’s time to consider exiting long positions.
For example, look at this S&P 500 index weekly chart
which just zooms in on another part of that same chart that we saw at the
beginning of the video.
During the period of July 27 to September 27 (bounded by the arrows) the index was in the DBB buy zone, so the odds favored holding long positions, and opening new ones.
If you look back at the first chart of this video, you’ll see that just by using this rule, you would have caught most of the uptrend during the period covered, while avoiding the down periods.
During the period of July 27 to September 27 (bounded by the arrows) the index was in the DBB buy zone, so the odds favored holding long positions, and opening new ones.
If you look back at the first chart of this video, you’ll see that just by using this rule, you would have caught most of the uptrend during the period covered, while avoiding the down periods.
In this lesson's video, it is stated
that, unless trades are meant to be kept open for no more than a few hours at
most, fundamental analysis should always be taken into account in executing
trades.
It is important to emphasise that
while good fundamental analysis can usually enhance longer-term trading, it is
by no means an essential part of trading profitably on any time-frame. It is
perfectly possible to be profitable with technical analysis alone.
Nevertheless, most of the world's most profitable traders would tend to agree
that a good ability to combine the two methods leads to the best results.
The video focuses on Rule #3: exit
any trend trades, and consider range trading strategies, when the price has
made a sustained move into the neutral zone.
Some further advice:
- Don't enter or exit a trade based on just one technical indicator alone
- Technical signals can be more easily interpreted with greater trading experience
- Don't rely on technical analysis only (see the earlier comments)
·
Rule #3 of the Double Bollinger Band
Trading System posits that one should not trade based on Double Bollinger Band
indicators when the price is between the buy and sell zones.
·
What this means is that when the
price is in the middle zone of the 1 standard deviation Bollinger Bands, the
trend isn’t strong enough to depend on. In this case, it would not be prudent
to trade unless there is enough other fundamental evidence or signals from your
other technical indicators that suggest the trend will continue.
·
There are times when one should
ignore rule 3 and other times when it is necessary to find that balance between
using too little evidence to see the full picture and using so much that it
causes paralysis and prevents one from taking action.
·
However, rule 3 may often work well
in keeping the trader out of a choppy situation where it is harder to trade
profitably when there is no clear trend as indicated by the Double Bollinger
Bands.
How
to Use Bollinger Bands
When price is in the middle area bounded
by the one standard deviation Bollinger Bands, (aka the DBB neutral zone),
that’s your signal to exit any trades that are riding the current up or down
trend, because that trend is showing weakness. There isn’t enough up or down
momentum for us to have confidence in the uptrend or downtrend.
Bollinger
Bands Strategy
In other words, when price makes a
sustained move into the neutral zone, that’s a signal to:
- Exit trend based trades
- Consider range-trading strategies. That is, entering
long positions at the bottom of the trading range, closing them as price
reaches the upper end of that range, and then opening short positions to
ride the move back to the lower end of the trading range.
-
For example, see Fig 8.6 above and focus on the area bounded by the arrows on
the right and the left.
The Double Bollinger Bands neutral zone is bounded by the red Bollinger bands, which are one standard deviation away from the purple 20 week simple moving average that forms the baseline for both sets of Bollinger bands.
During this period, the index spent most of its time within this middle, neutral zone that signals a lack of trend strength. Shorter term range traders might try to trade the range. Those who prefer to trade strong trends would have saved themselves time and money by avoiding trading.
However, Figure 8.6 is a great illustration of 3 key points:
Point 1: Don’t trade based on signals from just one technical indicator like DBBs
Note that for much of the period, the index was in the sell zone, bounded by the lower red and yellow Bollinger bands. Per rule 1 above, that means we should have been short the index.
The problem is that price kept chopping up and down in a narrow range, and after a few candles would jump back and forth between the lower sell zone and middle neutral zone. Unless you were trading on a much shorter time frame, making money by betting on a downtrend would have been challenging and risky.
That’s why we use additional technical indicators, and also pay attention to the fundamentals, like news events, that so often drive these price moves shown on the charts.
Point 2: You improve at interpreting technical signals with experience
Here’s a classic case of how rules like these are not immutable, but rather are helpful guidelines that you’ll become better at applying as you gain experience.
An experienced trader would know that when volatility drops and price trades in a narrow range, Bollinger bands reflect that reduced volatility and the distance between them narrows. That reduced distance from one zone to the next is a signal that:- Price movements between the DBB zones are less meaningful, weaker signals because little price change is needed to make those moves. Any moves to different DBB zones should be viewed with more skepticism than in times of wider trading ranges and greater distance between the different DBB zones.
- There is no strong momentum and thus no reliable trend.
Thus when you first start using DBBs or other popular indicators, don’t be quick to condemn them if they don’t work for you. The problem might be with your own lack of experience.
Point 3: Don’t rely on technical analysis only
Unless you’re trading very short term movements and don’t plan on holding a position for more than a matter of minutes or hours, you need to pay attention to fundamental analysis, like the key headlines that are driving markets.
For example, note how in Figure 8.6 above the first 10 candles were in the DBB buy zone. Per rule 2, we should have been long the index. However the Spring and Summer of 2010 were when the first (of what would become a series) of Greek debt crisis hit markets, and there were legitimate concerns of another financial crisis on a magnitude of that which hit in late 2008 to early 2009, when the global banking system itself appeared unstable. Given that threat, risk-averse traders might have considered exiting some or all of their long risk asset positions even before the index began to dive.The lesson's video ends with a recommendation to ensure a more effective use of DBBs by combining them with leading indicators such as moving average crossovers and/or MACD or other oscillators.The classification of particular indicators as leading or lagging can be controversial. For our purposes, MA crossovers and MACD can be deemed to be leading indicators, but they are classically seen as lagging indicators. Stochastics is an oscillator and an undisputed leading indicator. The most leading indicator of all is candlestick analysis. The important thing is that some other form(s) of analysis is combined with DBBs.The lesson's video summarizes Rule 4 of trading DBBs:- Minimize risk by either waiting for the price to retrace to the cheaper end of the buy or sell zone, or entering trades in stages
- Beware of the "falling knife": this is when you trade against a strong movement expecting it to stop and reverse after your entry, but it just keeps going
- Watch out for any major technical or fundamental contradictions to your trade, and if they are present, stay out
- Always use a reasonable stop loss
- It is best to combine DBBs with leading indicators, as DBBs are strongly lagging indicators
· Rule 4 of the Double Bollinger Band Trading System states that a trader should minimize risk by either waiting until price retraces to the cheaper end of the buy or sell zone, or by entering positions in stages. This rule attempts to cut the risk of buying at the top or selling at the bottom that comes with chasing a strong trend that has already made significant progress and may be approaching major resistance or (if it has broken past historic highs or lows) exhaustion.· Double Bollinger Bands is only one type of indicator used by advanced Forex traders. Experienced traders and investors use a combination of both fundamental and technical analysis before placing their trades. The mix depends greatly on the both personal preferences, and especially on their preferred time frames. Long term traders lean more towards the fundamentals because most fundamental factors take time, sometimes months or many years, to fully exert their influence following rules for using them. Short term traders who enter and exit the market within less than one day or just a few days need to be much more focused on technical indicators shown on charts.· Using Double Bollinger Bands is one way for short term traders to gauge how these forces are likely to influence short term price movements over the coming minutes, hours, or days via technical indicators. By following the rules on how to properly view them, Double Bollinger Bands can be very useful for short term traders.Minimize Risk By Either Waiting Until Price Retraces to the Cheaper End of the Buy or Sell Zone, Or Enter Positions In Stages
In other words:- If price is at the upper end of the buy zone, consider waiting for it to pull back to the lower end before taking new long positions. If you don’t want to wait out of fear of missing further moves higher, only open part of your planned long position and wait for a pullback to the lower end of the buy zone before adding new long positions.
- If price is at the lower end of the sell zone, consider waiting for it to rise to the upper boundary before opening new short positions. If you don’t want to wait because you fear missing further moves lower, enter a short positions that is only a part of your total planned trade and wait until the pair rises towards the upper end of the sell zone before opening new shorts.
Again, your final decision would be based on your reading of both other technical and fundamental signals.
This rule attempts to cut the risk of buying at the top or selling at the bottom that comes with chasing a strong trend that has already made significant progress and may be approaching major resistance or (if it has broken past historic highs or lows) exhaustion.
This rule is not easy to implement. Your success depends on how well you read and interpret the other technical and fundamental evidence, so that you better understand the odds of catching a bargain rather than the dreaded “falling knife” (i.e. an apparent bargain that continues moving against you and results in a loss).
Thus the key qualification to Rule 4: Consider the full range of evidence available, both technical and fundamental. There should be no major contradictions from other technical indicators or fundamental data that suggest the trend is in fact exhausted. If there are, stand aside, and don’t trade until the situation clarifies. As always, to protect yourself against that “falling knife,” have a stop loss order in place to prevent an unacceptable loss.
- Using the rule got you a bargain price if you bought at the lower end of the
buy zone during the week of September 27, 2009 (first down arrow
However, if you bought at the close of the week of April 25, 2010 (the topmost red candle, the eighth from the right), you caught a falling knife, as a threatened Greek default set off a sharp four week sell off.
The key to avoiding that loss was to recognize that the fundamentals were so bad at that point that they outweighed the suggested bargain of Rule 4.
What would have kept that loss affordable? In addition to reasonable stop losses
(which we always use, right?), Rule 4 also suggests entering positions in stages (rather than all at once) when chasing a strong trend that looks like it still has the momentum to run higher.
For example, during a strong uptrend, if you’re afraid of missing any further moves higher, buy a third of your total planned position even if near the top of the buy zone, another third when price retraces to the lower end of the buy zone, and another third when or if price bounces back into the middle of the zone.
Bollinger Bands Trading
Combine DBBs with a Leading Indicator
Because trends need time to build up enough momentum to enter the buy or sell zones, Double Bollinger Bands are distinctly lagging indicators and thus not good at catching briefer though perfectly tradable trends.
- For
example, as we see in Figure 8.8 above, if you had used only DBBs to time your
entries and exits during the Greek stage of the EU debt crisis that occurred in
the spring of 2010, you would not have shorted the downtrend until it was
mostly exhausted.
Thus DBBs are much more effective when used with some kind of leading indicator that gives hints of moves before they happen, or at least far earlier than DBBs. There are many of these among the family of momentum and timing indicators, like moving average crossovers, or one of the oscillator type indicators like MACD. We’ll take a brief look at these in the following lessons
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