Moving Average, for sure. MACD and Bollinger Bands.
But of course, the rub is in HOW you use them. I don't use MACD and Bollinger bands myself, but having just skimmed a couple of books on trading just for fun, and comparing the strategies they suggested with my own, I've seen how Bollinger bands CAN be put to pretty good use.
Yeah... I just went back and searched my entries, and here is the one I was thinking of...
PURE FADE
This strategy, which Prescott recommends be used exclusively with one-hour charts, seems to be pretty solid as far as I'm concerned. However, it's kind of its own animal and is not well suited for a one-to-one comparison with Numerical Price Prediction (NPP). Also, it looked to me like this setup does not offer a whole lot of trade opportunities.
Consequently, rather than summarize the approach here, I decided to simply look to see if a description already existed online, which it does. So, anyone who wishes to see detailed instructions on how to execute this type of trade (which uses three Bollinger bands and the RSI) can navigate to the following URL...
https://forexar.yolasite.com/index/the-pure-fade-trade
Here is the other...
TURN TO TREND
According to Prescott, this last setup is designed to find turns in price action in the context of the overarching framework of trading with the trend. It uses two time frames, a moving average and two sets of Bollinger bands as tools of entry.
First of all, the 20-period SMA is dropped on daily charts and used to determine if a given pair is in a trend. Bollinger bands are then plotted on hourly charts at both two and three standard deviations to create channels for pinpointing entries.
After consulting its daily chart to determine if a particular pair is trending in a given direction, traders then move to its hourly chart to see where candlesticks are painting in relation to the two sets of Bollinger bands. If the daily chart evidences a bullish trend, but the rate is trading between the
lower bands of the two indicators loaded on the hourly chart, it tells traders to stay away (given the present downward momentum).
However, once price trades
above the lower Bollinger band at two standard deviations, it is time to enter the market. A stop loss is set at the swing low minus five points. The target for the first half of the position is set at half the amount of risk. If this target is hit, the stop is moved to breakeven and the target for the second half of the position is set at the upper Bollinger band at three standard deviations. In other words, profit is taken as soon as price crosses to the outside (to the exterior)
above the channel formed by the two upper Bollinger bands.
(Obviously, the opposite is done when the daily chart displays a bearish trend.)
