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Strategies & Market Trends : Technical Analysis - Beginners -- Ignore unavailable to you. Want to Upgrade?

To: shasta23 who wrote (7209)	12/6/1997 10:27:00 PM
From: gonzongo	Read Replies (3) \| Respond to of 12039

Stefan: I discussed on the index( are you familiar with the best of the best index- it has a chapter on bands) at the following post: techstocks.com Frankly I understand the concept of standard deviations and can apply it successfully when the bands tighten- but I have no clue how to trade with it otherwise. So I use envelopes based on the assumption that a price always returns to its 21 day MA. SO the envelopes I use - 8% and 13% variances give me a gauge as to how far away from the norm we are- I don't know how it works with bb's. The envelopes work nicely with large cap stocks and are not as useful in canslim small cap stocks. Here is a chart of INTC with both 8 day bollinger bands and 21 day envelopes. The price tends to trend between the middle band and the top band in an uptrend and between the lowest band and the middle band in a downtrend. It is a grid on price- not a buy sell signal as I use it. Also notice when the red lines- the 8 day boll bands tighten- you often get a strong move up or down. geocities.com hope that helps- andy