The idea
Buy the bounce off the lower band; exit at the middle band. Best in quiet, range-bound markets. A strong trend walks down the lower band and stops it out.
Strategy guide · Mean reversion · long
Bollinger Bounce strategy: exact rules, strengths and weaknesses.
Buy the bounce off the lower band; exit at the middle band. Best in quiet, range-bound markets. A strong trend walks down the lower band and stops it out.
Entry rule
Buy when price bounces off the lower Bollinger Band (20, 2).
Exit rule
Sell at the middle band (the 20-period average).
Where it works
Quiet, range-bound markets where price keeps returning to its average.
Where it fails
Trends: in a strong fall price "walks" down the lower band and every bounce fails.
The common mistake
Treating a touch of the band as the signal. The rule needs the bounce, a close back inside the band.
Backtest it yourself
Sign in, open Genni Strategies and pick "Bollinger Bounce" from the leaderboard, or build it with the rule builder. Choose a coin and timeframe and press "Run backtest" to see every trade on up to 1,000 real candles, fees included. "Start paper trading" then follows it live without money.
Other strategies: EMA 9/21 Crossover · Golden Cross 50/200 · RSI Oversold Bounce · MACD Trend Momentum · SuperTrend Follow · Donchian 20 Breakout · RSI Overbought Short · All strategies
Questions
Frequently asked questions
What are the rules of the Bollinger Bounce strategy?
Entry: Buy when price bounces off the lower Bollinger Band (20, 2). Exit: Sell at the middle band (the 20-period average).
Does the Bollinger Bounce strategy work?
Best in quiet, range-bound markets. A strong trend walks down the lower band and stops it out. It tends to do well here: Quiet, range-bound markets where price keeps returning to its average. It tends to lose here: Trends: in a strong fall price "walks" down the lower band and every bounce fails. Past results do not predict future results.
How can I backtest the Bollinger Bounce strategy for free?
Sign in, open Genni Strategies and pick "Bollinger Bounce" from the leaderboard, or build it with the rule builder. Choose a coin and timeframe and press "Run backtest" to see every trade on up to 1,000 real candles, fees included. "Start paper trading" then follows it live without money.
This page is education, not investment advice. Trading involves substantial risk of loss. Read next: Trading indicators · Trading strategies · Candlestick patterns