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Investment
Bollinger Bands
A technical indicator that consists of a middle band (moving average) and two outer bands that measure volatility.
Bollinger Bands were created by John Bollinger. They are excellent for spotting volatility breakouts and mean-reversion trades. Many traders use them together with RSI for confirmation.
It's like drawing two lines around the price that expand when the market is crazy and squeeze when it's calm.
Real world: When the bands squeeze tight, a big price move is often coming soon. When price touches the upper band it is considered overbought; touching the lower band is oversold.
💡 Bollinger Bands show you when the market is quiet and about to explode.