Bollinger Bands Stock Indices Indicator and Indices Price Volatility

When stock indices trading price volatility is high; stock indices trading prices close far away from the moving average, the indices trading Bollinger Bands width increases to accommodate more possible stock indices trading price action movement which can fall within 95% of the mean.

Bollinger bands stock indices indicator will widen as stock indices trading price volatility widens. This will show as bollinger band bulges around the stock indices trading price. When the indices trading bollinger bands widen like this it is a continuation indices pattern and stock indices trading price will continue moving in this direction. This is normally a continuation indices trade signal.

The Bollinger bands stock indices indicator example explained and illustrated below illustrates the Bollinger bulge.

High Indices Price Volatility - Bollinger Bands Indices Indicator - Bollinger Band Bulge

When stock indices trading price volatility is low: stock indices trading prices close closer toward the moving average, the width decreases to reduce the possible stock indices trading price action movement which can fall within 95% of the mean.

When stock indices trading price volatility is low stock indices trading price will start to consolidate waiting for stock indices trading price to breakout. When the indices trading bollinger bands indicator is moving sideways it is best to stay on the sidelines and not to place any stock indices trades.

The Bollinger bands indicator examples is illustrated below when the indices trading bollinger bands narrowed.

Low Indices Price Volatility - Bollinger Bands Indices Trading Indicator - Bollinger Bands Squeeze