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RSI & Bollinger Bands Trading Strategy

This document provides a summary of a trading strategy that uses Bollinger Bands and RSI to identify reversal and momentum trade opportunities. It discusses key Bollinger Band concepts like M Tops, W Bottoms, and pinches. The strategy uses a combination of indicators like RSI, stochastics, and Super Trend plotted on a daily chart to determine buy and sell signals. Examples are given showing the strategy applied to different stocks. The strategy is most suitable for range-bound stocks and may not work as well on volatile indexes. The document concludes with a Q&A section.

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drupadhyaygunjan
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382 views22 pages

RSI & Bollinger Bands Trading Strategy

This document provides a summary of a trading strategy that uses Bollinger Bands and RSI to identify reversal and momentum trade opportunities. It discusses key Bollinger Band concepts like M Tops, W Bottoms, and pinches. The strategy uses a combination of indicators like RSI, stochastics, and Super Trend plotted on a daily chart to determine buy and sell signals. Examples are given showing the strategy applied to different stocks. The strategy is most suitable for range-bound stocks and may not work as well on volatile indexes. The document concludes with a Q&A section.

Uploaded by

drupadhyaygunjan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

Profitable Trading Plan Using RSI & Bollinger Band- Souradeep Dey

What we will learn


• Concept Of Bollinger Band

• M Top and W Bottom

• Walking the Bands –using multiple Bollinger bands in a single chart

• Pinch

• Turning of Bands

• BB %B and Bollinger Bands Width

• Reversal trades

• Momentum Trades

• Swing Trading Strategy


Bollinger Band
▪ Inputs
▪ Width of bands
▪ Slope of bands
▪ Time frame
▪ Convergence and Divergence
M Top
W Bottom
Walking the band-Hugging the band
Pinch reversal
Pinch - continuation
Pinch Traps
Turning of Bands - indication of loss of
momentum
Reversal Trades – Case Study- Bullish
Reversal Trade Case Study - Bearish
Momentum Trade - Case Study Bullish
Momentum Trade - Case Study Bearish
Trading Strategy Ingredients (Daily Time Frame)
▪ RSI-14
▪ Stochastics (55,34,21)
▪ Super Trend (10,2)
▪ Bollinger Band (20,2)
▪ ATR (5)
Trading Strategy (For Swing Trading in daily
chart)
CONDITION FOR SHORTING
CONDITION FOR BUY

At the close of candle (Daily) At the close of candle (Daily)


▪ RSI should be Above 50 ▪ RSI should be Below 50
▪ Price should be Above Super Trend ▪ Price should be Below Super Trend
▪ Super-trend should be Below mid-bollinger ▪ Super-trend should be Above mid-
bollinger
▪ Stochastics should be having %K above %D
▪ Stochastics should be having %K Below %D
▪ Price Low should be Below super trend
▪ Price High should be Above super trend
▪ Buy in last two minutes with a stop of 1.1
ATR and Target of 2.2 ATR of the candle ▪ Short in last two minutes with a stop of 1.1
ATR and Target of 2.2 ATR of the candle
▪ Colour of supertrend does not change
▪ Colour of supertrend does not change
Trade Set up Examples –ITC (Range-bound
stock)
Trade Set up Examples –Axis Bank (Range-
bound stock)
Trade Set up Examples –Tech Mahindra
(Directional stock)
Trade Set up Examples – Tata Motors(Volatile
stock)
Trade Set up Examples – Nifty (Index- strategy
fails due to extreme ranged movement)
Q&A
THANK YOU

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