Bollinger Bands Indicator and Price Volatility

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

Bollinger Bands xauusd indicator will widen as price volatility widens. This will show as the bollinger band bulges around the price. When the bollinger bands widen like this it is a continuation xauusd pattern & market will continue moving in this direction. This is generally a continuation signal.

The Bollinger band xauusd indicator exemplification shown below illustrates and shows the Bollinger bulge.

Bollinger Band & Price Volatility, Analyzing High Low Volatility Markets using Bollinger Bands

High Price Volatility - Gold Bollinger Band Indicator - Bollinger Band Bulge

When price volatility is low: gold prices close closer toward the moving average, the width decreases to minimize the possible price action movement which can fall within 95 percentage of the mean.

When price volatility is low price will begin to consolidate waiting for price to break out. When the bollinger bands indicator is moving sideways it is best to stay on the sidelines & not to place any trades.

The Bollinger band indicator exemplification is illustrated below when the bollinger bands narrowed.

Bollinger Band & Price Volatility, Analyzing High Low Volatility Markets using Bollinger Bands Indicator

Low Price Volatility - Gold Bollinger Band Indicator - Bollinger Band Squeeze

More Topics and Tutorials:

Trade Forex Trading

Bollinger Bands Indicator and Price Volatility