A plain-English explainer — then the honest backtest, because knowing what it is isn't the same as knowing whether it works.
Bollinger Bands wrap a moving average in an upper and lower band set a number of standard deviations away. They expand when volatility rises and contract when it falls, framing where price is 'stretched'.
Two opposite strategies use them: bounce (buy the lower band, betting on mean reversion) and breakout (buy a push through the upper band, betting the move continues). A 'squeeze' — unusually tight bands — is watched as a coiled-spring setup.
Honestly backtested, neither the bounce nor the breakout is the money-printer it's sold as, though the squeeze-breakout fares better. Standard deviations describe volatility; they don't predict direction.
Does Bollinger Bands actually work?
Don't take the textbook's word for it — see the honest, survivorship-free score.
See the honest backtest →the Bollinger bounce · the Bollinger breakout · the Bollinger squeeze · all strategies →
Bollinger Bands wrap a moving average in an upper and lower band set a number of standard deviations away. They expand when volatility rises and contract when it falls, framing where price is 'stretched'. Two opposite strategies use them: bounce (buy the lower band, betting on mean reversi
On its own, Bollinger Bands is an indicator, not a guarantee. We backtested the strategies built on it with survivorship-free data — see the honest scores linked below.
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Educational, not financial advice. An honest backtest score measures whether a result survives statistical scrutiny — it does not predict future profit, and is not a buy or sell signal. · About · FAQ · All strategies