How to Begin with Investing and Trading (Series): Implementation Outline

The Blog Entry that Accompanies this Vlog is at: investorandtrader.blogspot.com My Daily Blog is at: investorandtrader.blogspot.com My channel at BlogTV is: www.blogtv.com My Podcast is at: airelon.podbean.com and embedded in the daily blog. The question I receive more than any other, bar none - is . . . How do I begin in the markets? I mention this video is in regards to the stock market or futures account. But the principles apply to the Forex, to day trading, commodity futures options …

Investment Series: Buy and Hold is Not Dead

The Blog Entry that Accompanies this Vlog is at: investorandtrader.blogspot.com My Daily Blog is at: investorandtrader.blogspot.com My channel at BlogTV is: www.blogtv.com My Podcast is at: airelon.podbean.com and embedded in the daily blog. The market is down! The market is down! Buy and Hold is dead! Buy and hold is dead! Warren Buffett is a hack! I’ve heard statements like this, and others since this bear market (which so many of us knew was coming). But does this mean that Buy and Hold …

Introduction to Money Management for Investing and Trading

The Blog Entry that Accompanies this Podcast is: investorandtrader.blogspot.com My Daily Blog is at: investorandtrader.blogspot.com My channel at BlogTV is: www.blogtv.com Whether you are a forex, stock market, day trader or commodity futures trader, Money management is key. Most know that from my daily blog at investorandtrader.blogspot.com , I often talk about Money Management. Now on the video blog, I will give a brief introduction to it, and in the next few entries, discuss Money …

How to Begin with Investing and Trading (Series): Educational Roadmap

The Blog Entry that Accompanies this Vlog is at: investorandtrader.blogspot.com My Daily Blog is at: investorandtrader.blogspot.com My channel at BlogTV is: www.blogtv.com My Podcast is at: airelon.podbean.com and embedded in the daily blog. The question I receive more than any other, bar none - is . . . How do I begin in the markets? I mention this video is in regards to the stock market or futures account. But the principles apply to the Forex, to day trading, commodity futures options …

How to Begin with Investing and Trading: A Traders History

My Daily Blog is at: http://investorandtrader.blogspot.com/

My channel at BlogTV is: http://www.blogtv.com/People/Airelon

My Podcast is at: http://airelon.podbean.com/ and embedded in the daily blog when I release a new podcast.

The Blog Entry that Accompanies this Vlog is at: http://investorandtrader.blogspot.com/2009/01/how-to-begin-with-investing-and-trading.html

Ok. Good information. But I want to trade. How do I begin? How do I get started. Great question. Some people want to invest in the stock market. Some people want to day trade. Some people want to swing trade in the stock market. How do you begin?

I discuss that in this video . . .

NOTE: This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 13 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research and risk tolerance

Investing and Trading: How do I begin? A Traders History pt1

My Daily Blog is at: http://investorandtrader.blogspot.com/

Ok. Good information. But I want to trade. How do I begin? How do I get started. Great question. Some people want to invest in the stock market. Some people want to day trade. Some people want to swing trade in the stock market. How do you begin?

I discuss that in this video . . .

Airelon’s Investing and Trading Thoughts: January 2009 (We Cannot Predict)

My Daily Blog is at: http://investorandtrader.blogspot.com/

My channel at BlogTV is: http://www.blogtv.com/People/Airelon

My Podcast is at: http://airelon.podbean.com/ and embedded in the daily blog.

The Blog Entry that Accompanies this Vlog is at: http://investorandtrader.blogspot.com/2009/01/airelons-investing-and-trading-thoughts.html

I think, perhaps at times, we gravitate towards various outlooks in the markets because of the things we have experienced in life. There are many ways to make money in the stock market.

Allow me to share what I’ve learned, why, and what I plan to do for January, 2009 …

NOTE: This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 13 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research and risk tolerance

25. How to Trade Bollinger Bands - Stocks, Futures, Forex

http://www.informedtrades.com/
A Lesson on Bollinger Bands for active traders and investors using technical analysis in the forex, futures, and stock markets.

The link that I refer to on Standard Deviation is here: http://en.wikipedia.org/wiki/Standard_deviation

The link that I refer to with more resources on Bollinger Bands is here:

http://www.informedtrades.com/tags/index.php/bollinger%20bands/

In our last lesson we learned about the Stochastic Oscillator and how traders use this in their trading. In today’s lesson we are going to learn about an indicator which helps traders gauge the volatility and how current prices compare to past prices.

Bollinger Bands are comprised of three bands which are referred to as the upper band, the lower band, and the center band. The middle band is a simple moving average which is normally set at 20 periods, and the upper band and lower band represent chart points that are two standard deviations away from that moving average.

Example of Bollinger Bands:

Bollinger bands are designed to give traders a feel for what the volatility is in the market and how high or low prices are relative to the recent past. The basic premise of Bollinger bands is that price should normally fall within two standard deviations (represented by the upper and lower band) of the mean which is the center line moving average. If you are unfamiliar with what a standard deviation is you can read about it here http://en.wikipedia.org/wiki/Standard_deviation. As this is the case trend reversals often occur near the upper and lower bands. As the center line is a moving average which represents the trend in the market, it will also frequently act as support or resistance.

The first way that traders use the indicator is to identify potential overbought and oversold places in the market. Although some traders will take a close outside the upper or lower bands as buy and sell signals, John Bollinger who developed the indicator recommends that this method should only be traded with the confirmation of other indicators. Outside of the fact that most traders would recommend confirming signals with more than one method, with Bollinger bands prices which stay outside or remain close to the upper or lower band can indicate a strong trend, a situation that you do not want to be trading reversals in. For this reason selling at the upper band and buying at the lower is a technique that is best served in range bound markets.

Example of Buying and Selling at the Upper and Lower Band:

Large breakouts often occur after periods of low volatility when the bands contract. As this is the case traders will often position for a trend trade on a break of the upper or lower Bollinger band after a period of contraction or low volatility. Be careful when using this strategy as the first move is often a fake out.

Example

As Bollinger bands paint a good picture directly on the price chart of how high or low price is relative to historical prices, this is a good indicator to use in conjunction with other methods such as some of the chart patterns that we have learned so far and some of the candlestick patterns which we will learn in future lessons. Below is one such example:

As Bollinger Bands are one of the most popular indicators around I have created a special page on InformedTrades.com which lists multiple resources for those looking for more information on trading Bollinger Bands.

That’s our lesson for today. You should now have a good understanding of Bollinger bands and how traders use these in their trading. In our next lesson we are going to go over the Average Directional Index or ADX, which helps traders identify the strength or weakness of a trend so we hope to see you in that lesson.

As always if you have any questions or comments please feel free to have them in the comments section below, and have a great day!