What is a 'Bollinger Band'?
Bollinger Bands®are a measure of volatility, when the markets become more volatile, the bands widen; during less volatile periods, the bands contract.
Breakouts:
Approximately 90% of price action occurs between the two bands. Any breakout above or below the bands is a major event. The breakout is not a trading signal (Bollinger recommends using multiple signals before committing to a trade). The mistake most people make is believing that that price hitting or exceeding one of the bands is a signal to buy or sell. Breakouts provide no clue as to the direction and extent of future price movement.
Source: https://www.investopedia.com/terms/b/bollingerbands.asp
New to trading cryptos? Join Coinbase/Gdax with my referral link and get $10:
