Why do most people use the wrong bollinger band? We need to know why. When using the bollinger band indicator, many people will tell you that the stock price will sell when it hits the upper rail of the bollinger band and buy when it hits the lower rail. That's what it sounds like. Many times the market really works like this. In most cases, the stock price changes within the scope of the three lines of the Bollinger Band.

Indicators are not everything. If someone tells you that there is any omnipotent index in stock trading, it is guaranteed to make money, especially if you have to pay for it. Be sure to pay attention to the risks. You are basically a liar.

If you follow the method of buying on the lower rail and selling on the upper rail, it is easy to encounter some so-called abnormal phenomena in the market. For example, when the resistance of the upper rail continues to rise, the so-called resistance seems to have no effect. When the support on the lower rail continues to fall, the so-called support is as thin as a piece of paper and seems to have no effect. Why do indicators that look so useful actually operate very clumsily?

What is the essence of bollinger bands?

The essence of the bollinger band is actually the moving average, and the middle track of the bollinger band is actually the 20-day moving average. Remember this sentence, the upper rail and the lower rail also evolved from the standard deviation on the basis of the moving average. The so-called standard deviation, I believe many friends who have attended junior high school know, is also a misunderstanding of many people. I think the bollinger band is amazing. The K-line basically runs in the track and rarely derails. In fact, this is a very simple mathematical principle, and the standard deviation is twice.