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Bollinger Bands Indicator and Price Volatility

When trading price volatility is high: prices close far away from the moving average, the trading Bollinger Band width increases to accommodate more possible trading price action movement which can fall within 95 percent of the mean.

Bollinger Bands indicator will widen as price volatility widens. This will show as the bollinger band bulges around the trading price. When the trading bollinger bands widen like this it's a continuation pattern and trading market will continue heading and going in this direction. This is normally a continuation trade signal.

The Bollinger bands indicator example explained & illustrated below shows the Bollinger bulge.

High Price Volatility

High Price Volatility - Bollinger Band - Bollinger Bands Bulge

Low volatility narrows prices around the moving average. The band squeezes to fit 95% of moves near the center.

Low price swings mean prices consolidate. They wait for a breakout. Sideways Bollinger Bands signal? Stay out. Skip stock trades.

The Bollinger bands indicator examples is illustrated beneath when the bollinger bands narrowed.

Low Price Volatility - Bollinger Band and Price Volatility, High Low Volatility Markets

Low Price Volatility - Bollinger Band - Bollinger Band Squeeze

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