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Bollinger Bands Stock Indicator Bulge and Squeeze Technical Analysis

The Stock Bollinger Bands are self adjusting which means the bands widen and narrow depending on stocks price volatility.


Standard Deviation is the statistical measure of the stocks price volatility used to calculate the widening or narrowing of the stock trading Bollinger bands. Standard deviation will be higher when stock prices are changing significantly and lower when the stocks trading market stock prices are calmer.


  • When stocks price volatility is high the Bollinger Bands widen.

  • When stocks price volatility is low the Bollinger Bands narrows.


How To Stock Trade Bollinger Bands Squeeze 

Narrowing of stock trading Bollinger Bands is a sign of stocks price consolidation and is known as the Bollinger band squeeze.


When the Bollinger Bands stock indicator display narrow standard deviation it is usually a time of stocks price consolidation, and it is a stock signal that there will be a stock price breakout and it shows stock traders are adjusting their trade positions for a new move. Also, the longer the stock prices stay within the narrow bands the greater the chance of a stock price breakout.

The Bollinger Bands Squeeze

Bollinger Squeeze - The Bollinger Bands Squeeze - How To Stock Trade Bollinger Bands Squeeze



How To Stock Trade Bollinger Bands Bulge

The widening of Bollinger Bands is a sign of a stock price breakout and is known as the Bollinger Bands Bulge.


Bollinger Bands that are far apart can serve as a stock signal that a stock trend reversal is approaching. In the Bollinger bands stock indicator example explained below, the stock trading Bollinger bands get very wide as a result of high stocks price volatility on the down swing. The stock trend reverses as stock prices reach an extreme level according to statistics and the theory of normal distribution. The "bulge" predicts the change to a stock downward stocks trend.

The Bollinger Bulge

Bollinger Bulge - The Bollinger Bulge - How To Stock Trade Bollinger Bands Bulge

 

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