bollinger band

Bollinger Bands are a technical analysis indicator that help identify relative high and low prices. Using this information, you can potentially buy at lower prices and sell at higher prices.

The indicator consists of three lines: the middle line is a simple moving average, and the other two lines are plotted above and below it at a certain distance away. This distance is calculated using standard deviation, which measures how much the price has varied from its average value over a given period of time. The wider the distance between the upper and lower bands, the higher the volatility of the price.

To use Bollinger Bands TA as method in AILidex, you can configure at which percentage from the lower band to buy and at which percentage from the upper band to sell. Orders are placed after the price moves outside the set level and then moves back in. Keep in mind that Bollinger Bands are just one tool among many for analyzing the markets, so make sure you understand how they work before relying on them for trading decisions.

How to work with it
Buy method conditions
A buy order is allowed when price moves below the lower band, and then moves back in.

Sell method conditions
A sell order is allowed when price moves above the upper band, and then moves back in.

INFO
Gain protection is optional for this strategy.

Be aware that this can lead to sell orders below your break-even point.

Trading example

Example of how trading with this strategy can perform. Details and settings

The infographic below describes what triggers trades with this strategy.

Buy settings
Buy settings are the primary trigger for buy orders. These parameters control the execution of buy orders when using bbta as buy method.

Take Buy is only available for AILidex Standard and higher.

Buy enabled
Description
Values
Order types
Name
Set this to false to prevent AILidex from placing buy orders.

Buy Level
Description
Values
Order types
Name
This sets entry point at a percentage below the lowest EMA.

When you set this to 1, the entry point will be set 1% below the currently lowest EMA.

Sell settings
Sell settings are the primary trigger for sell orders. These parameters control the execution of sell orders when using bbta as sell method.

Sell enabled
Description
Values
Order types
Name
Set this to false to prevent AILidex from placing sell orders.

Gain
Description
Values
Order types
Name
This sets the minimum target for selling when DOUBLE_CHECK_GAIN is enabled.

Indicator settings
Relevant indicators for trading with BBTA

These settings have a direct effect on trading with bbta.

Period
Description
Values
Order types
Name
This sets the candlestick period used for trading, this affects all indicators within the strategy.

Only use supported values. The trading settings editor suggests valid values for the selected exchange..

Setting a short period allows you to trade on shorter trends, but be aware that these will be noisier than longer periods.

Low BB
Description
Values
Order types
Name
This sets the target for buying. Negative values are allowed.

The bot will buy after prices first move under the set % from the lower Bollinger Band, then cross over the set level.

When set to 0, the lower Bollinger Band is the target. When set to 30, the target is 30% above the lower Bollinger Band – the upper band is at 100% from the lower band. Negative values are allowed.

High BB
Description
Values
Order types
Name
This sets the target for selling. Negative values are allowed.

The bot will sell after prices first move over the set % from the upper Bollinger Band, then cross down the set level. Additionally GAIN must be reached.

When set to 0, the upper Bollinger Band is the target. When set to 30, the target is 30% under the upper Bollinger Band – the lower band is at 100% from the upper band. Negative values are allowed.

SMA Period
Description
Values
Order types
Name
This defines the number of periods used for calculating Bollinger Bands.

Standard Deviation
Description
Values
Order types
Name
This value defines the multiplier used for calculating Bollinger Bands.

Slow EMA
Description
Values
Order types
Name
Set this to the amount of candlesticks you want to use for your slow EMA. The closing price for each candle is used in the slow EMA calculation.

For example: when you set PERIOD to 5, and want to use 2h for slow EMA – you need to set EMA1 to 24 (24 * 5 mins).

Medium EMA
Description
Values
Order types
Name
Set this to the amount of candlesticks you want to use for your medium EMA. The closing price for each candle is used in the fast EMA calculation.

For example: when you set PERIOD to 5, and want to use 1h for medium EMA – you need to set EMA2 to 12 (12 * 5 mins).