Bollinger Bands Volatility Squeeze and Breakout Trading Strategies

Developed by John Bollinger, Bollinger Bands measure market volatility relative to a moving average baseline.

1. Formula & Structure

1. Middle Band: 20-period Simple Moving Average (SMA). 2. Upper Band: $\text{SMA}_{20} + (2 \times \sigma)$ 3. Lower Band: $\text{SMA}_{20} - (2 \times \sigma)$