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# Help setting up a simple Bollinger Band strategy

Forex Forum → Help setting up a simple Bollinger Band strategy

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## Posts: 5

#### Topic: Help setting up a simple Bollinger Band strategy

Hi

Could someone help me set up a very simple Bollinger Band strategy? I'm trying to learn how to use FSB.

Strategy:
1. Go long a the lower band of a 2 standard deviation Bollinger Band
2. Stop loss at the lower band of a 3 standard deviation Bollinger Band
3. Take profit at the middle line of a 2 standard deviation Bollinger Band

If anyone could help me with this I'd really appreciate it.

Thanks!

Pete

#### Re: Help setting up a simple Bollinger Band strategy

To make it work as intended, you have to choose either point 2 or 3, can't have them both I'm afraid.

There is a workaround though, but it will introduce lag. If higher timeframes are used, it most probably won't work out.

One comment about "the middle line of a 2 standard deviation Bollinger Band" - it's a simple moving average, deviation parameter works for the bands only.

You could try this workaround:

[Opening Point of the Position]
Bollinger Bands
Enter long at the Lower Band
Smoothing method  -  Simple
Base price  -  Close
MA period  -  20
Multiplier  -  2.00
Use previous bar value  -  Yes

[Closing Point of the Position]
Bar Closing
Exit the market at the end of the bar
Base price  -  Close

[Closing Logic Condition]
Bollinger Bands
[ a ]   The bar closes below the Lower Band
Smoothing method  -  Simple
Base price  -  Close
MA period  -  20
Multiplier  -  3.00
Use previous bar value  -  No

[Closing Logic Condition]
Moving Average
[ b ]   The bar closes above the Moving Average
Smoothing method  -  Simple
Base price  -  Close
Period  -  20
Shift  -  0
Use previous bar value  -  No

#### Re: Help setting up a simple Bollinger Band strategy

footon wrote:

To make it work as intended, you have to choose either point 2 or 3, can't have them both I'm afraid.

There is a workaround though, but it will introduce lag. If higher timeframes are used, it most probably won't work out.

One comment about "the middle line of a 2 standard deviation Bollinger Band" - it's a simple moving average, deviation parameter works for the bands only.

Thank you so much!!! Of course the middle of a BB is a SMA - how stupid of me!!!  I'll back test this over the weekend - my idea is to trade a 5 min timeframe during the Asian session when  pairs usually range.

PS Footon - your Better Bollinger Bands custom indicator throws up a few errors when you load it with the latest version of FSB:

Custom Indicators
File name: Better Bollinger bands.cs
ERROR: Indicator compilation failed in file [Better Bollinger bands.cs]
Line 13 Column 28: The type or namespace name 'Infrastructure' does not exist in the namespace 'ForexStrategyBuilder' (are you missing an assembly reference?).
Line 14 Column 28: The type or namespace name 'Infrastructure' does not exist in the namespace 'ForexStrategyBuilder' (are you missing an assembly reference?).
Line 15 Column 28: The type or namespace name 'Infrastructure' does not exist in the namespace 'ForexStrategyBuilder' (are you missing an assembly reference?).
Line 19 Column 41: The type or namespace name 'Indicator' could not be found (are you missing a using directive or an assembly reference?).
Line 31 Column 41: The type or namespace name 'SlotTypes' could not be found (are you missing a using directive or an assembly reference?).
Line 121 Column 40: The type or namespace name 'IDataSet' could not be found (are you missing a using directive or an assembly reference?).

#### Re: Help setting up a simple Bollinger Band strategy

Pete, I think the indi is fine, but the confusion lies in different versions. Newest betas or RC versions are V3, therefore indis have to support V3. But there are 2 type of indis circulating now - the old version (V2) and the new one (V3).

I think you downloaded Better Bollinger from my indi thread, which includes V2 indis, and put it in the V3 FSB, hence the errors.

It could be the other way round - you're using V2 FSB with V3 indicator. Then hop in to my indi corner and download Better Bollinger from there: http://forexsb.com/forum/post/15959/#p15959

#### Re: Help setting up a simple Bollinger Band strategy

Thanks, you've been a great help.

I backtested the above BB strategy and it performs dismally, even though it looks quite good visually.  Not sure why, I think it has to do with the way FSB backtests using bar open???  I'll do some more investigation over the weekend and report back if I can make it profitable.

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