24 basic indicators (10) -- Boll

Bollinger indicator-Boll

Boll indicators are also called Bollinger indicators. Their full names are "bolinger bands". They are used by John? It is a medium-and long-term technical analysis tool for judging the stock price movement trend.

Section 1 boll principles and calculation methods

I. Boll metric principles

The boll indicator is American stock analyst John? A very simple and practical technical analysis index designed based on the standard deviation principle in statistics. In general, the stock price movement always changes within a certain range around a certain value center (such as the moving average and cost line). The Bollinger index is based on the above conditions, the stock price channel concept has been introduced. It believes that the stock price channel width varies with the stock price fluctuation, and the stock price channel has variability, it will automatically adjust as the stock price changes. It is precisely because of its flexibility, intuition, and trend characteristics that boll indicators have gradually become a popular market indicator widely used by investors.
Among the many technical analysis indicators, boll indicators are a special type of indicators. Most technical analysis indicators are constructed by means of quantity. They do not rely on trend analysis and morphological analysis, but boll indicators are closely related to the stock price and trend. The "stock price channel" in the boll index is an intuitive expression of the stock price trend theory. Boll uses the "stock price channel" to show the various prices of the stock price. When the stock price fluctuates very small and is in consolidation, the stock price channel will narrow down, this may indicate that the stock price fluctuates in a temporary period of silence. When the stock price fluctuates beyond the narrow stock price channel, it indicates that the abnormal and intense upward fluctuations of the stock price are about to begin; when the stock price fluctuates beyond the narrow stock price channel, it also indicates that the stock price will begin to fluctuate sharply.
Investors often encounter two most common trading traps: one is the low-buy trap. After an investor buys a low price, the stock price not only keeps falling, but also keeps falling. The other is the high-sell trap, after a stock is sold at a so-called high point, its share price has risen all the way. In particular, he used Einstein's theory of relativity and thought that all types of markets are interactive. All changes in the market and between the market are relative, and there is no absolute nature. The high and low prices of stock prices are relative, the stock price above or below the rail line only indicates that the stock price is relatively high or low. Before making an investment judgment, investors must also make a comprehensive reference to other technical indicators, including price coordination, psychological indicators, analogy indicators, and associated market data.
In short, the stock price channel in the boll index plays an important reference role in predicting the future trend of the market. It is also a unique analysis method of the Bollinger indicator.

Ii. Boll indicator calculation method

In all the index calculation, the boll index calculation method is one of the most complex. The concept of standard deviation in statistics is introduced, involving the middle rail line (MB) and upper rail line (up) and line (DN) calculation. In addition, as with the calculation of other indicators, the selected calculation cycle is different, boll indicators include daily boll indicators, weekly boll indicators, monthly boll indicators, and hourly boll indicators. The daily and weekly boll indicators are often used for stock market research. Although their values are different during calculation, the basic calculation method is the same.
The daily boll metric calculation is used as an example. The calculation method is as follows:
1. Daily boll indicator calculation formula
Middle rail line = N-day moving average line
Upper rail line = middle rail line + standard deviation of twice
Lower rail line = middle rail line-standard deviation of two times
2. Daily boll metric calculation process
(1) Calculate Ma
MA = the sum of the closing prices within n days minus n
(2) Calculate the standard deviation MD
MD = square root n the sum of the (C-MA) power divided by N
(3) Calculate the MB, Up, And dn lines
MB = ma on (N-1) Day
Up = MB + 2 × MD
DN = MB-2 × MD
In the stock market analysis software, the boll indicator consists of four lines, namely, the upper rail line up, the middle rail line MB, the lower rail line DN and the price line. The upper-rail line up is the line of up values, expressed in yellow; the middle-rail line MB is the line of MB values, expressed in white; the lower-rail line DN is the line of DN values, it is represented by a purple line; the price line is represented by a US line, and the color is light blue. Like other technical indicators, in practice, investors do not need to calculate boll indicators. They mainly understand boll calculation methods and processes to gain a deeper understanding of boll indicators, lay the foundation for using indicators.

Section 2 General Evaluation Criteria for boll indicators

The general evaluation criteria for boll indicators are mainly concentrated in

I. Significance of the upper, middle, and lower rail lines in the boll indicators

1. The moving range of the stock price channel formed by the upper, middle, and lower rail lines in the boll indicator is uncertain. The upper and lower limits of the channel change with the fluctuation of the stock price. Under normal circumstances, the stock price should always be in the stock price channel. If the stock price runs out of the stock price channel, it means that the market is in an extreme state.
2. In the boll indicator, the stock price channel goes up and down to show the highest and lowest prices for the safe operation of the stock price. Both the upper and lower rail lines can support the operation of the stock price, while the upper and middle rail lines sometimes play a pressure role on the operation of the stock price.
3. Generally, when the stock price runs on the middle rail line of the Bollinger line, it indicates that the stock price is in a strong trend. When the stock price runs below the middle rail line of the Bollinger line, it indicates that the stock price is in a weak trend.

Ii. Relationship between upstream, central, and downstream rail lines in the boll indicator

1. When the upper, middle, and lower rail lines of the Bollinger line run upwards at the same time, it indicates that the strong characteristics of the stock price are very obvious and the stock price will continue to rise in the short term. Investors should firmly hold shares to be up or bought at a low price.
2. When the upper, middle, and lower rail lines of the Bollinger line run down at the same time, it indicates that the weak characteristics of the stock price are very obvious. The stock price will continue to fall in the short term, and investors should firmly hold the currency to watch or buy at a high level.
3. When the upper and lower lines of the Bollinger line run down, while the middle and lower lines are still running up, it indicates that the stock price is in the Consolidation status. If the stock price is on a long-term upward trend, it indicates that the stock price is a strong trend on the way up, investors can hold shares to watch or short-term purchases on DIPS; if the stock price is on a long-term downward trend, it indicates that the stock price is a weak sort on the way down, and investors should hold the currency to wait and see or cut down the stock on rallies.
4. The upper and lower lines of Bollinger lines run up, while the middle and lower lines run down at the same time, so we will not judge them here.
5. When the upper, middle, and lower rail lines of the Bollinger line run horizontally at the same time, it depends on the current situation of the stock price.
(1) When the stock price has been falling for a long period of time and then began to move horizontally on the three lines of the Bollinger line, it indicates that the stock price is at the bottom of the construction phase, and investors can start to build a small number of warehouses in batches. Once the three lines go up, you can increase the buying speed.
(2) When the stock price was at a slight increase in the early stage, it began to move horizontally on the three lines of the Bollinger line, indicating that the stock price was at the rising stage, investors can share their shares to be up or below short-term absorption, once the three lines up the divergence can be short-term overweight to buy.
(3) When the stock price has just experienced a round of slump, it began to move horizontally on three lines of the Bollinger line, indicating that the stock price is in a falling stage. Investors should hold the currency and wait and take a wait-and-see effect on rallies, once the three lines go down, they will be resolutely cleared.
(4) There is a very small possibility of horizontal movement of the three lines on the top of the Bollinger line. We will not judge it here.

3. Relationship between the American line (or the K line, the same below) and the upper, middle, and lower rails of the Bollinger line

1. When the U.S. line breaks through the middle rail line below the middle rail line of the Bollinger line, it indicates that the strong characteristics of the stock price begin to emerge and the stock price will rise, investors should mainly buy stocks in the medium and long term.
2. When the U.S. line goes above the middle-rail line of the Bollinger line and above the upper-rail line, it indicates that the strong characteristics of the stock price have been established and the stock price may rise in the short-term, investors should primarily hold shares to rise or buy short-term orders.
3. When the U.S. line breaks through the upper, middle, and lower rail lines of Bollinger lines, the movement continues to go up, it indicates that the stock market is still strong, and the stock price will rise in the short term. Investors should firmly hold their shares to continue to rise, it was not until the U.S. line began to show signs of turning back and down that the market was turning around.
4. After the U.S. line has been moving upwards over the Bollinger line for a period of time, if the direction of the U.S. line starts to turn downward, investors should be extremely careful. Once the U.S. line turns downward and breaks through the Bollinger line, it indicates that a strong stock price in the short term may end, and the stock price will fall sharply in the short term. Investors should promptly buy stocks and wait and see when they leave. This is especially true for stocks that have increased significantly in the short term.
5. When the US line breaks through the upper, middle, and lower rail lines of the Bollinger line, if the upper, middle, and lower rail lines of the Bollinger line start to go down at the same time, it indicates that the short-term strong stock price is coming to an end, and the short-term trend of the stock price is not optimistic. Investors should base their efforts on the increase and decrease of shares.
6. When the U.S. line breaks through the middle rail of the Bollinger line from top to bottom, it indicates that the strong stock price in the early stage has ended and the mid-term decline trend of the stock price has been formed, investors should sell shares in a timely manner in the middle. It can be more confirmed if the upper, middle, and offline of the Bollinger line are also downward.
7. When the US line falls below the bottom line of the Bollinger line and continues to fall down, it indicates that the stock price is in an extremely weak market. Investors should firmly hold on to the currency and try not to buy stocks.
8. After the U.S. line has been running off the Bollinger line for a period of time, if the U.S. line shows signs of turning upwards in the direction of movement, it indicates that the share price will stop falling and stabilize in the short term, and investors can build a small position on low sides.
9. When the US line breaks through the Bollinger line from below and up, it indicates that the short-term stock price may pick up. Investors can buy stocks in a timely manner to make the short-term rebound.
10. When the US line remains on the middle rail line and moves upwards with the middle rail line, it indicates that the stock price is in a strong upward trend, as long as the US line does not fall below the middle rail line, investors firmly hold shares all the way.
11. When the US line remains below the middle rail line and moves downward with the middle rail line, it indicates that the share price is in a weak decline process, as long as the US line does not reverse upwards and breaks through the middle rail line, stable investors can all stay on the sidelines.

Section 3 special methods for analyzing boll indicators

I. Analysis and Determination of the "Bell Mouth" of Bollinger lines

The Analysis and Determination of the "Bell Mouth" of the boll line is a unique method of boll indicators. The so-called "Bell Mouth" refers to the stock price operation process, the upper and lower rail lines of the Bollinger lines expand or move closer from two opposite directions to the middle rail lines, forming a special shape similar to the bell mouth. According to the different operation directions and positions of the upper and lower rail lines of the binglin line, we can also divide the "Bell Mouth" into three types: Opening bell mouth, closing bell mouth and tightening bell mouth. The mouth of an open-ended loudspeaker is often seen in the early stages of a stock surge in the short term. The mouth of a closed-ended loudspeaker is often seen in the early stages of a stock slump, the closed-mouth bell-mouth is often seen at the end of the sharp drop in the stock price.
1. Open bell mouth
After the stock price is sorted at the bottom for a long time, the upper and lower rail lines of the Bollinger lines gradually contract, and the distance between the upper and lower rail lines is smaller. As the transaction volume increases, the stock price suddenly soars up and down. At this time, the upper-rail line of the Bollinger line also rapidly rises up, while the lower-rail line accelerates the downward movement, in this way, the shape between the upper and lower rails of the Brin line forms a special form similar to that of the Big Horn. We call the bell ports of the Brin line as the opening bell ports.
The open-ended loudspeaker is a form that shows that the stock price is greatly improved in the short-term. It is a trend that occurs when the stock price changes upwards after a long low horizontal disk base is built. The upward and downward directions of the Bollinger lines are the opposite, but the intensity is great, indicating that the multi-headed forces are gradually strong and the short-headed forces are gradually exhausted, and the stock price will be in the short-term sharp rise.
There are two conditions for the formation of the opening bell mouth. First, the stock price needs to be sorted out through a long period of mid-low horizontal disk. The longer the sorting time, the smaller the distance between the upper and lower rails, the larger the increase in the future. Second, it is the occurrence of a significant large transaction volume when the Brin line begins to open.
The establishment of the opening bell mouth form is based on the US line (or the K line) to break through the upper rail line, the stock price to break through the medium and long term average. Investors may be profitable if they can buy open-ended speakers in a timely manner.
2. Receiver-type bell ports
When the stock price rises sharply in a short period of time, the upper and lower rail lines of the Bollinger line gradually expand, and the distance between the upper and lower rail lines is getting bigger and bigger. As the transaction volume decreases gradually, the stock price fell sharply at a high position. At this time, the upper-rail line of the Bollinger line began to quickly turn around and down, while the lower-rail line is still accelerating the rise, in this way, the shape between the upper and lower rails of the Brin line becomes a special form similar to that of the inverted Big Horn. We call this mouth of the Brin line as the mouth of the receiver.
The closed-mouth loudspeaker is a form that shows a sharp downward breakthrough in the stock price in the short-term. It is formed after a short period of sharp rise in the stock price, facing a downward change in the disk trend. The upper and lower lines of the Bollinger line show a sharp opposite direction and a great intensity trend, indicating that the bear power is gradually strong and the multi-headed power is getting exhausted, and the stock price will fall sharply in the short term.
Although there is no requirement on the transaction volume, the formation of the form of the closed-mouth bell must also meet a condition that the stock price has been greatly increased in the short-term, the larger the pull, the larger the distance between the upper and lower rails, the larger the decline in the future.
The establishment of the form of the closed-mouth bell mouth is based on the Stock Price's upper rail line starting to turn downward, the stock price falls below the short-term average. For the appearance of closed-mouth speakers, investors can keep profits if they can sell them in a timely manner, reducing large losses.
3. Tight-mouth bell mouth
After a long decline in the stock price, the upper and lower rails of the Bollinger line gradually move closer to the middle rail, and the distance between the upper and lower rails is getting smaller. As the transaction volume gets smaller, the stock price oscillates repeatedly at the low level, at this time, the upper rail of the Bollinger line is still moving downward, while the lower rail line is slowly rising. In this way, the shape between the upper and lower rails of the Brin line becomes a special form similar to that of the inverted small horn. We call this bell mouth of the Brin line as a tight-mouth bell mouth.
The tight-mouth bell mouth is a form that shows that the stock price will be consolidated for a long time. It is formed after the stock price falls sharply for a long time. It is facing a trend of long-term adjustment. The upper and lower rail lines of the Bollinger line gradually move closer, indicating that the power of both sides is gradually in balance, and the stock price will be in a long-term sideways market.
The Formation Conditions and validation criteria of the tight-mouth bell mouth are relatively loose. As long as the stock price drops sharply for a long time, the transaction is extremely shrinking, when the distance between the upper and lower rails is getting smaller, it can be determined that the tight-mouth horn is initially formed. When the tight-mouth bell mouth appears, investors can wait and see, or build a small number of warehouses.

Ii. Sales marks of medium rail

1. When the U.S. line (or the K line) breaks through the middle of the Bollinger line, if the stock price also breaks through the medium-term average of the stock price, it means that the stock price starts to rise in the short-term and upward trend, this is a medium-and short-term buy indicator.
2. When the U.S. line (or the K line) breaks through the middle rail of the Bollinger line, if the stock price rises upwards Based on the middle rail of the Bollinger line, it means that the middle and short-term upward trend of the stock price has become complementary, this is a sign of buying or holding shares at a low price revealed by the Bollinger indicator.
3. When the US line (or the K line) falls down to the middle rail of the Bollinger line, if the stock price also falls below the middle and short-term average, it means that the stock price's middle and short-term downward trend begins to form, this is a medium-and short-term sales indicator.
4. When the U.S. line (or the K line) breaks through the middle rail of the Bollinger line, if the stock price is suppressed by the middle rail of the Bollinger line, it means that the decline in the middle and short ends of the stock price has become a complementary trend, this is the currency holding sign revealed by the Bollinger indicator.

Iii. Use boll and kdj indicators

The kdj indicator is an overbought and oversold indicator, while the Bollinger curve is a support pressure indicator. The advantages of combining the two are: it can make the kdj indicator signal more accurate, at the same time, because of the price daily K-line indicator system of the Bollinger line indicators, often reflects the mid-term operation trend of the price, therefore, using these two indicators to determine whether the price is a short-term fluctuation or a medium-term fluctuation has a certain effect, especially for determining whether the price is a short-term peak (bottom ), it is still in the middle of the Rise (decline), with a relatively good result of research and determination.
We know that the upper and lower rails in the binglinder have a pressure effect, and the middle and lower rails have a support (pressure) effect. Therefore, when the price falls to the middle or lower rails of the binglin line, you can ignore the signal sent by the kdj indicator and take the action. Of course, if the kdj indicator is low, it should be regarded as a result of mutual verification between short-term trends and mid-term trends, and adopt a more positive operating strategy. However, it should be noted that, when the price drops to the off-rail line of the Bollinger line, even if it is supported and returns stable, the kdj indicator is also rising, and the signal that can turn to the trend has been issued, therefore, we can only rebound once at most. When the kdj index reaches the 80 high, it is safer to take the selling action, because when the stock price falls below the middle rail of the Bollinger line, it will lead to a narrowing of the Bollinger line opening, in this case, the index should be fixed for at least a long time. Therefore, we should not continue to hold the index whether it is to prevent the risk of falling or to consider the opportunity cost.

Section 4 practical skills of boll indicators

The practical skills of the boll indicators mainly focus on the relationship between the stock price's K-line (or the U.S. line) and the boll indicators, as well as the opening and closing conditions of the boll lines. In some software, boll indicators are on the main chart. In order to make more accurate analysis and determination of market conditions, we can use boll indicators and Trix indicators to study and determine the market conditions. The following uses the Analyst's boll indicator as an example to reveal its trading and wait-and-view functions. (Note: In most software, the boll indicator parameters are not modified ).

I. Sales Signals
1. When the stock price's K-line traffic breaks through the upper rail of the Bollinger line, and the Trix indicator has also issued a base "Golden Cross", it indicates that the stock price is about to enter a medium-and long-term upward channel, this is the buy signal from the boll indicator. At this time, investors should promptly buy stocks. (20-1.
2. After a narrow horizontal movement of the base position of the Bollinger line for a long period of time, once the stock price's K-line bandwidth breaks through the upper rail of the Bollinger line, and the originally narrow Bollinger line Channel suddenly opens upwards, this indicates that the stock price is about to break away from the original horizontal Operation Channel and enter a new rising channel, which is also a buy signal sent by the boll indicator. (20-2.
3. When the stock price breaks down the middle rail of the Bollinger line and the Trix indicator is also sending a high "Dead cross", it indicates that the stock price is about to enter a medium-and long-term decline channel, this is a sell signal from the boll indicator. At this time, investors should leave the market as soon as possible. (20-3.
4. After a long period of high and narrow horizontal movement of the Bollinger line, once the stock price's K-line breaks down the bottom rail of the Bollinger line, and the originally narrow Bollinger Channel suddenly opens down, this indicates that the stock price is about to exit the original horizontal Operation Channel and enter a new downward channel, which is also a sell signal from the boll indicator. (20-4.

Ii. Currency Ownership Signal
1. As long as the stock price's K-line always runs above the middle rail of the Bollinger line, the stock price remains on a medium-and long-term upward track, this is the signal from the boll index that holds shares to be increased. If the Trix indicator also sends a shareholding signal, this signal is more accurate. At this time, investors should firmly hold their shares to stay up. (20-5.
2. When the bringling line opens down, as long as the stock price's K line is always running below the middle rail of the bringline, it indicates that the stock price has been in a medium-and long-term decline track, this is the currency holding wait signal issued by the boll indicator. If the Trix indicator is also a currency holding signal, this signal is more accurate. At this time, investors should firmly hold on to the coin.