Bollinger Band Indicator Strategy

Bollinger Band Stock Indices indicator acts as a measure of volatility. Bollinger Band Stock Indices indicator is a price overlay indicator.

Bollinger Band indicator consists of three lines or bands: the middle band (moving average), an upper band a lower band. These three bands will enclose the price and the price action will move within these three bollinger bands.

Bollinger Band Stock Indices indicator forms upper & lower bands around a moving average. The default moving average for bollinger bands Stock Indices indicator is the 20-SMA. Bollinger Band Stock Indices indicator use the concept of standard deviations to form their upper & lower Bands.

The example of Bollinger Band Stock Indices indicator is displayed and illustrated below.

Bollinger Band Indicator - How to Trade Stock Indices with Bollinger Band Stock Indices Strategy

Because standard deviation is a measure of Stock Index price volatility & volatility of the Stock Indices market is dynamic, Stock Indices bollinger bands keep adjusting their width. Higher Indices price volatility means higher standard deviation and the more the bollinger bands widen. Low Stock Index price volatility means the standard deviation is lower & the bollinger bands contract.

Bollinger Band forex indicator use price action to give a large amount of Stock Index price action movement information. The Stock Indices price information given by the this bollinger bands Stock Indices indicator includes:

• Periods of low volatility - consolidation phase of the Stock Indices market.
• Periods of high volatility - extended trends, trending Stock Index markets.
• Support & resistance levels of the Stock Indices price.
• Buy & Sell points of the Stock Indices price.