Bollinger Bands are a technical analysis tool which utilises standard deviation to establish where an area of support or resistance may lie. The bands are plotted above and below a simple moving average. In a trading strategy Bollinger Bands should only be used as an extra confluence.
The bands can also widen or contract depending on how volatile the market is.
- Bollinger bands widen when the market is more volatile
- Bollinger bands narrow when the market is less volatile
Happy Trading everyone,
@TradingHelpe
