Board dedicated towards Bollinger bands and their indicators which will condition these stocks for eventual breakout. Albeit on the upside or the downside. It all about the Bollinger bands Baby!!!!!!!!
Developed by John Bollinger, Bollinger bands consist of 3 lines; a 20 period simple moving average, a line placed two standard deviations above the 20 period simple moving average and a line placed two standard deviations below the 20 period simple moving average.
Price is considered overbought at the upper band and oversold at the lower band. Bollinger bands also gives a clue as to when to expect a breakout. Breakouts occur following periods of low volatility. When volatility is low, Bollinger bands are close together (tight). Thus, tight Bollinger bands should be a warning of a pending breakout.
"Overbought / Oversold
MACD values can also fluctuate above and below the Zero line. When it rises dramatically and is too far above the Zero line, it indicate as an overbought condition. When MACD falls dramatically and is too far below from the Zero line, it indicates as an oversold condition.
When either one of the condition above occurs, the shorter moving average pulls away from the longer term moving average. The stock is extremely overbought or oversold under these conditions and will soon return to normal levels.
Divergences appear between the trend of the MACD lines and the stock price. There are two types of divergences: Bearish divergence and Bullish divergence.
Bullish divergence occurs when MACD line is below the Zero line and start to show strength while prices continue to move downward. "
Thanks to http://www.diytraders.com/content/view/33/47/