434# Not so squeezy

Bollinger Squueze Trading Method

Submit by Stowed 11/02/2013


The Bollinger Squeeze is far from a new concept, indeed it is as old as the Bollinger Bands themselves, combining them with the Keltner channels is a slightly newer concept, but again not something that isn't widely used, we are not trying


to break new ground, we are just trying to find something that will tell us when the market has stopped to think, and I have found nothing better. Now before you all go off excitedly, there is one major flaw in the Bollinger Squeeze, Keltner Channel method, while it provides excellent timing, it doesn’t indicate the most important factor, that being direction. Times when volatility is so low give little to indicate which way the market will go. The reason why is the very reason the squeeze is in place in the first place. It is because everyone has stopped to think, as they try to figure out which way the next strong push should go.The decision may be that change needs to be made, or it may be that things were fine the way they were, it is something we will explore a little later.



Not so squeezy
Not so squeezy

Indicator 2: Rainbow Multiple Moving

Average (RMMA)

Settings: N/A

Measures: Trending vs Ranging conditions

The next indicator used is something I call the Rainbow

Multiple Moving Average (RMMA). It is, essentially not really

an indicator in the traditional sense, it is actually just eighty

eight Exponential Moving Averages (EMA's), all on the same

chart coloured like a rainbow, hence the name.


In the picture Not so squeezy forex system in action.


Indicator 3: Simple Moving Average (SMA)

Settings: 100SMA and 200SMA on Close

Measures: Support, Resistance and Barriers

Moving averages are very commonly seen in most systems,

usually either as an indication of trend, or used as an entry

signal when one moving average crosses over another. The

RMMA above of course takes this to the extreme, using 88

different averages to paint a picture of the trend, however

using moving averages as crossover entry signals alone has

been proven time and time again to be slow and clumsy,

especially in ranging conditions.

Another use however is to use these averages as dynamic

support and resistance areas. You may be familiar with

straight line trend lines acting as support and resistance

areas, but Moving Averages work just as well, if not better



Indicator 4: Bollinger Bands

Settings: 20,2,Close

Measures: Overbought, oversold conditions

It may seem odd that we are essentially, using the Bollinger

Bands twice in the system, once with the Keltner Channels

to define the squeeze and again here. However they have

two distinct uses.

Anyone who has used oscillators know the concept of

overbought and oversold conditions. Oscillators attempt to

tell us when price is relatively oversold or overbought

compared to recent history. Once these conditions are met,

then we are taught to look for a reversal in price. 4

for more read pdf..


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Not So Squeezy - Trading Manual
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