Indicators & Strategy

Bollinger Bands in Practice: Squeeze, Breakout and Reversion

Updated April 2026 · ~5 min read · For TradingView desktop 3.2.1

Bollinger Bands = a 20-period MA ± 2 standard deviations. They don't draw support and resistance — they draw the boundary of volatility. Get that and all three patterns click.

Pattern 1: the squeeze

Upper and lower bands narrow to their tightest in a while — volatility is compressed, and volatility mean-reverts: extreme contraction is usually followed by expansion. How to trade it:

1. Mark the upper and lower edges of the squeeze;
2. Wait for a candle body to close outside the range (not a wick poking out);
3. Trade the breakout direction, stop back inside the range. The squeeze foretells "a move is coming," not the direction — pre-betting direction is the main way to lose.

Pattern 2: walking the band

In a strong trend price hugs the upper (or lower) band for a run. Here "touched the upper band = overbought = short" is the most expensive misread — walking the band is the trend at its strongest. Change your trend exit to "a close back to the middle band" and you'll hold a lot more.

Pattern 3: mean reversion

Only in a clear range (flat bands, price crossing the middle repeatedly): trim/short at the upper band, add/long at the lower, middle band as target. The moment the bands start to open and tilt, stop using this playbook.