Bollinger Bands Stocks Indicator & Stock Price Volatility

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

Bollinger bands stock indicator will widen as stocks price volatility widens. This will show as bollinger band bulges around the stocks price. When the stock trading bollinger bands widen like this it is a continuation stock trading pattern and stocks price will continue moving in this direction. This is normally a continuation stock trade signal.

The Bollinger bands stock indicator example illustrated and explained below illustrates the Bollinger bulge.

High Stock Price Volatility - Stocks Trading Bollinger Bands Indicator - Bollinger Band Bulge

When stocks price volatility is low: stock prices close closer towards the moving average, the width decreases to reduce the possible stocks price action movement which can fall within 95 % of the mean.

When stocks price volatility is low stocks price will start to consolidate waiting for stocks price to breakout. When the stock trading bollinger bands indicator is moving sideways it is best to stay on the sidelines and not to place any stocks trades.

The Bollinger bands indicator examples is shown below when the stock bollinger bands narrowed.

Low Stock Price Volatility - Stocks Trading Bollinger Bands Indicator - Bollinger Bands Squeeze