The signal of a single indicator often has limitations, and the Bollinger Bands are no exception. However, when used in conjunction with other technical indicators, they can create a 'complementary effect' that filters out invalid signals and improves trading success rates. This article recommends three classic 'Bollinger Bands+' combinations, each suited for different trading styles, to help everyone understand the core logic, application scenarios, and operational techniques of each combination.
Combination One: Bollinger Bands + RSI (Relative Strength Index), suitable for trend following. Core logic: Bollinger Bands determine the trend direction and volatility, while RSI assesses overbought and oversold conditions to avoid blindly going against the trend due to indicator lag. Application techniques: In an uptrend, when the Bollinger Bands expand and the price is close to the upper band, if the RSI is in the overbought zone (>70), there's no need to rush to sell, as long as the price does not break below the middle band, the trend continues; if the RSI falls back from the overbought zone to above 50 and the price remains close to the upper band, you can continue to hold; if the RSI drops below 50 and the price breaks below the middle band, then exit. In a downtrend, conversely, when the RSI is in the oversold zone (<30), as long as the price does not rise above the middle band, the trend continues; if the RSI rises to below 50, continue to hold; if the RSI breaks above 50 and the price rises above the middle band, stop loss and exit.
Combination 2: Bollinger Bands + KDJ (Stochastic Indicator), suitable for short-term breakouts. Core logic: Bollinger Bands capture breakout signals, KDJ confirms the validity of the signals, filtering false breakouts. Application tips: When Bollinger Bands show a breakout signal (price effectively breaks through the upper and lower bands), if KDJ shows a golden cross (bullish breakout) or a death cross (bearish breakout), and K and D values are within a reasonable range (not extreme overbought or oversold), then the probability of a true breakout is high, and entry is possible; if KDJ is in the extreme overbought or oversold zone during the breakout and divergence occurs (price breaks out, KDJ does not), then it is likely a false breakout, and one should wait and observe.
Combination 3: Bollinger Bands + MACD (Moving Average Convergence Divergence), suitable for medium-term reversals. Core logic: Bollinger Bands identify reversal patterns (expansion to contraction + price breaking the middle band), MACD confirms trend reversals (golden cross/death cross + divergence). Application tips: At the end of an uptrend, if Bollinger Bands begin to contract, the price breaks below the middle band, and MACD shows a death cross with a top divergence (price makes a new high, MACD does not), then the reversal signal is confirmed, and a short position can be set; at the end of a downtrend, if Bollinger Bands contract, the price rises above the middle band, and MACD shows a golden cross with a bottom divergence (price makes a new low, MACD does not), then the reversal signal is confirmed, and a long position can be set.
It should be noted that the core of the indicator combination is 'complementary', rather than 'stacked'. There is no need to pair multiple indicators simultaneously; just choose 1-2 indicators that match your trading style to avoid excessive signals that lead to confused decision-making.@男神说币 #加密市场观察 $BTC
