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| Bollinger Bands were invented by John Bollinger in the early 1980s. Bollinger was a financial analyst and trader who developed the bands as a way to measure volatility and identify potential price breakouts and trend reversals in financial markets. The bands are based on a simple moving average of the asset's price and a standard deviation calculation. The upper and lower bands are defined as a certain number of standard deviations above and below the moving average. To use Bollinger Bands in trading, traders typically look for price movements that approach or cross the upper or lower boundaries of the band. Traders may also use the width of the bands as an indicator of market volatility. When the bands are wider, it may indicate higher volatility and potential trading opportunities. Conversely, when the bands are narrower, it may indicate lower volatility and potentially fewer trading opportunities. |
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Bollinger Bands
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| Bollinger Bands(20,2) Squeeze |
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| Bollinger Bands(20,2) Strong Squeeze |
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| Bollinger Bands(20,2) Squeeze 50% or Less |
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| Bollinger Bands(20,2) Squeeze 40% or Less |
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| Bollinger Bands(20,2) Squeeze 30% or Less |
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| Bollinger Bands(20,2) Squeeze 20% or Less |
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| Bollinger Bands(20,2) Squeeze 10% or Less |
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| Price Crossed Above Upper Band of Bollinger Bands(20,2) |
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| Price Crossed Above Middle Line of Bollinger Bands(20,2) |
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| Price Crossed Above Lower Band of Bollinger Bands(20,2) |
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| Price Crossed Below Upper Band of Bollinger Bands(20,2) |
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| Price Crossed Below Middle Line of Bollinger Bands(20,2) |
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| Price Crossed Below Lower Band of Bollinger Bands(20,2) |
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| Price Touched Above Upper Band of Bollinger Bands(20,2) |
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| Price Touched Above Middle Line of Bollinger Bands(20,2) |
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| Price Touched Above Lower Band of Bollinger Bands(20,2) |
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| Price Touched Below Upper Band of Bollinger Bands(20,2) |
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| Price Touched Below Middle Line of Bollinger Bands(20,2) |
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| Price Touched Below Lower Band of Bollinger Bands(20,2) |
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| Price Bounced Up From Upper Band of Bollinger Bands(20,2) |
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| Price Bounced Up From Middle Band of Bollinger Bands(20,2) |
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| Price Bounced Up From Lower Band of Bollinger Bands(20,2) |
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| Price Bounced Down From Upper Band of Bollinger Bands(20,2) |
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| Price Bounced Down From Middle Band of Bollinger Bands(20,2) |
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| Price Bounced Down From Lower Band of Bollinger Bands(20,2) |
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| Price Is Above Upper Band of Bollinger Bands(20,2) |
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| Price Is Above Lower Band of Bollinger Bands(20,2) |
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| Price Is Below Upper Band of Bollinger Bands(20,2) |
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| Price Is Below Lower Band of Bollinger Bands(20,2) |
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 Bollinger Bands - Technical Analysis from A to Z
Bollinger Bands are similar to moving average envelopes.
The basic interpretation of Bollinger Bands is that prices tend to stay within the upper- and lower-band. The distinctive characteristic of Bollinger Bands is that the spacing between the bands varies based on the volatility of the prices. During extreme price changes (i.e., high volatility), the bands widen to become more forgiving. During periods of stagnant pricing (i.e., low volatility), the bands narrow to contain prices.
Envelopes (Trading Bands) - Technical Analysis from A to Z
An envelope is comprised of two moving averages. One moving average is shifted upward, while the second is shifted downward. Envelopes define the upper and lower boundaries of a security's normal trading range. A sell signal is generated when the security reaches the upper band, whereas a buy signal is generated at the lower band. The optimum percentage shift depends on the volatility of the security - the more volatile, the larger the percentage.
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