jUsT`zH asked:
Will it be better to trade using bollinger bands or stdev?
Will it be better to trade using bollinger bands or stdev?
What do i mean by stdev?
I run an historical analysis to find out the stdev of the CHANGES in the spot price. Whenever the stdev falls outside 2 stdev, I will hit the trade.
For the bollinger band, whenever it falls outside the bands, i will trade.
My question is, is there a difference(i think there is) and what is the difference?
Which method is better? and why?
One method shows the stdev of the changes in spotprice, while the other shows the stdev of the spotprice itself.
Fundamentally, which one is better to use to trade?
{ 1 comment… read it below or add one }
There is no real answer to this question, since you are really talking about the same thing just sliced a littel differently.
I would use the the bolinger bands because you can get them without any work.
having said that–technical analysis is only worth just so much - and really only for active traders who don’t really care what companies they are trading in