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VolatilityIntermediate
Bollinger Bands
Volatility envelope around a moving average. Touches are not automatic reversals.
Formula (conceptual view)
Middle = SMA(N). Upper/lower = SMA ± k × standard deviation (classic N=20, k=2).
Common parameters: 20, 2
How to read
- ▸Wide bands = higher recent volatility; squeeze = compression (direction not guaranteed).
- ▸Walking the band in a strong trend can continue — do not auto-fade every touch.
- ▸Combine with structure and ATR for risk context.
- ▸Study squeezes historically with a journal; no mystical prediction.
Common mistakes
- ✕ Buying/selling every band touch.
- ✕ Assuming every squeeze explodes your way.
- ✕ Using bands as sole “system”.
Works well with
ATRTrend structureVolume context if available