Trading strategy of Bollinger bands and RSI indicators. Here is a summary of the strategy:
Bollinger bands are a technical analysis tool that measure the volatility of the price movements. They consist of three lines: a middle line, which is a moving average, and two outer lines, which are standard deviations above and below the middle line1.
RSI (Relative Strength Index) is a momentum indicator that measures the strength of the price changes. It ranges from 0 to 100, if the RSI is above 60 means the speed of coin to going up is faster and if the RSI is below 40 means the speed of coin going downward is faster. IF the RSI is wandering between 40 & 60 then the coin is in sideways.
The basic idea of this strategy is to buy when the price is supported by the middle Bollinger band and the RSI is above 60, indicating an uptrend. Conversely, sell when the price is resisted by the middle Bollinger band and the RSI is below 40, indicating a downtrend.
To confirm the trend direction, look for higher highs and higher lows in an uptrend, and lower highs and lower lows in a downtrend. Avoid trading when the price is moving sideways, which means the RSI is between 40 and 60. Wait for a clear breakout above or below the middle Bollinger band before entering a trade.
You can see in the 1st picture that candles above the middle line of #Bollingerbands looks buying opportunity and #RSI also above 60 and vise versa.
And where i Marked circle that is sideways caseand you can see #RSI also wandering between 40 and 60.
However, remember that no strategy is perfect and you should always use risk management tools such as stop-losses and take-profits to protect your capital. You should also backtest your strategy