Bollinger Stochastic pairs Bollinger Bands with the stochastic oscillator to identify overextended moves.
Price touching the outer band while the oscillator is in an extreme zone suggests a possible snap back.
The system fades those extremes, going long when price hits the lower band with stochastic oversold, and shorting the upper band with stochastic overbought.
A percent-based stop limits risk if the mean reversion fails to occur.
Entry Criteria: indicator signal
Long/Short: Both
Exit Criteria: stop-loss or opposite signal
Stops: Yes, percent based
Default Values:
CandleType = 15 minute
StopLoss = 2%
[*]Filters:
Category: Mean reversion
Direction: Both
Indicators: Bollinger Bands, Stochastic
Stops: Yes
Complexity: Intermediate
Timeframe: Intraday
Seasonality: No
Neural networks: No
Divergence: No
Risk level: Medium