Using the bands

Bollinger bands make for great overbought or oversold indicators. Broadly speaking, when the price of a security is higher than the upper Bollinger band on a chart, you're in a sell area, and when the price is lower than the lower Bollinger band, you're in buy territory. As you can see in Figure 11-11, there are plenty of buy and sell opportunities using these bands. But not every one of those opportunities is worth acting on immediately, so combining them with your handy candlestick charts can be an ideal way to minimize risk and separate the great signals from the mediocre ones.

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