Bollinger Band Timer System

Bollinger Band Timer System Killer BB Techniques for Traders

copyright 2011 Mark Deaton

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Bollinger Band Timer System

Properties of Bollinger Bands

If Bollinger bands is contracting it PUSHES price action. If Bollinger bands is expanding it PULLS price action. If Bollinger bands is just moving sideways it will likely PUSH price action as well. If price has moved OUSIDE of Bollinger bands, it WILL revert to the mean its just a matter of when?

copyright 2011 Mark Deaton

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Bollinger Band Timer System

Sideways or contracting will PUSH price action

copyright 2011 Mark Deaton

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Bollinger Band Timer System

Expanding will PULL price action

copyright 2011 Mark Deaton

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Bollinger Band Timer System

Contraction with HEAD BUTTING. Price action moving up against a DOWNWARD moving band. copyright 2011 Mark Deaton

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Bollinger Band Timer System Reverse Polarity – PUSH: Holding, contracting, Bouncing. Magnet – PULL: Expanding.

Contraction with HEAD BUTTING. Price action moving up against a DOWNWARD moving band. copyright 2011 Mark Deaton

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Bollinger Band Timer System Reverse Polarity – PUSH: Holding, contracting, Bouncing. Magnet – PULL: Expanding.

10 EMA

10 EMA acts just like the mean as support or resistance for stronger trending moves. Also the pull away from or closeness to the mean defines trend strength.

Contraction with HEAD BUTTING. Price action moving up against a DOWNWARD moving band. copyright 2011 Mark Deaton

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Bollinger Band Timer System

10 EMA

copyright 2011 Mark Deaton

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Bollinger Band Timer System

Variations of long tails or wicks are your friend. Anytime price pushes LARGE in a particular direction and gets pushed back – is a sign that the first attempt at direction failed and the winner is the one that pushed back. Look to your bands, or other support and resistance for KEY entry into set-ups that involve these single candlesticks. copyright 2011 Mark Deaton

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Bollinger Band Timer System

This arrow points to a recent short on the S&P 500 that had swing structure, strong resistance horizontally as well as trend line resistance and a head butt into a downward moving Bollinger band.

copyright 2011 Mark Deaton

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Bollinger Band Timer System

A look at swing structure.

copyright 2011 Mark Deaton

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Bollinger Band Timer System

The question is, exactly how do we enter a long or short position based on swing structure and keep our risk to an absolute minimum?

copyright 2011 Mark Deaton

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Bollinger Band Timer System

One way is to enter near the close of the candlestick that completes the swing. Another is to enter at the open of the next. Both have merit but what needs to be considered and studied is how that entry affects your risk profitle.

copyright 2011 Mark Deaton

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Bollinger Band Timer System

Another option could be a break of the first candle in the swing – specifically the candles high.

My preference is to get in as early as possible. The tighter I can have my stop the lower my risk is. The earlier I can get in, the sooner I can get out and let the frenzy get me a nice fill on my exit. Additionally the earlier I can get in the less likely I'm to see a larger spread between the bid and ask in the case of stocks or options. Strategy is important here, so lets look into this a bit – your entry can make a huge difference in your trading. copyright 2011 Mark Deaton

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Bollinger Band Timer System

In order to demonstrate variations on my preferred entry I need to show you illustrations. Keep in mind these are MY preferences – that doesn’t mean they has to be yours. Also keep in mind that every example I show you has many potential variations. What I’m showing you are principles that need to be understood and then you need to go beyond the example and absorb the principles.

copyright 2011 Mark Deaton

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Bollinger Band Timer System

A

B

Here we have one of my favorite entries at support, whatever support that may be – usually it’s a form of horizontal support , the BB mean, or 10 EMA and sometimes even the lower BB. Either way the set-up appears initially to be one where support failed, and in the end we end up with one of our favorite set-ups – the single candlestick hammer in this case. Problem is by the time we recognize it we missed it so we need to learn to recognize it at A instead of B.

copyright 2011 Mark Deaton

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Bollinger Band Timer System

So how do we do that? Well we need to first recognize the set-up. It looks like this. Again CAN COME IN MANY FORMS EVERYWHERE – we’ll get into the bands and how it forms there, but it forms at any of our strong support levels. 1. 2. 3. 4.

Bands Mean 10 EMA Standard chart support/resistance.

copyright 2011 Mark Deaton

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Bollinger Band Timer System

A

B

C

Lets call A a daily chart, well call B a 15 minute chart. If I saw my potential setup as in A, I would pull up my 15 minute B and watch swing structure for entry and hope for a reversal as near the low as possible.

copyright 2011 Mark Deaton

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Bollinger Band Timer System

A

B

C

Lets call A a daily chart, well call B a 15 minute chart. If I saw my potential setup as in A, I would pull up my 15 minute B and watch swing structure for entry and hope for a reversal as near the low as possible. This allow for entry here… copyright 2011 Mark Deaton

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Bollinger Band Timer System

A

B

C

Lets call A a daily chart, well call B a 15 minute chart. If I saw my potential setup as in A, I would pull up my 15 minute B and watch swing structure for entry and hope for a reversal as near the low as possible. This allow for entry here… So when the setups complete I’m in at C early on WAY before anyone else and my setup is now confirmed. copyright 2011 Mark Deaton

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Bollinger Band Timer System

A

B

C

The great thing about this entry is that if the setup doesn’t complete and close above support I will get out with a profit before the close. If the setup doesn’t even move UP and stops me out on the shorter time frame my losses are minimal.

copyright 2011 Mark Deaton

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Bollinger Band Timer System

Here’s what it looks like if it fails to close above support. Both, provided you use your proper shorter time frame allow you to get out unscathed.

copyright 2011 Mark Deaton

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Bollinger Band Timer System

copyright 2011 Mark Deaton

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Bollinger Band Timer System

copyright 2011 Mark Deaton

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Bollinger Band Timer System

copyright 2011 Mark Deaton

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Bollinger Band Timer System How do we enter here

Like this

copyright 2011 Mark Deaton

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Bollinger Band Timer System

Bollinger Band Chart Set Up

copyright 2011 Mark Deaton

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