Bollinger Bands Cheat Sheet
Quick reference for reading Bollinger Bands — including what not to do.
Quick reference table
| Standard settings | 20-SMA, 2 standard deviations |
| Bandwidth narrowing | Squeeze — low volatility, often precedes breakout |
| Bandwidth widening | Volatility expansion — confirms breakout direction |
| Walking the bands | Price hugging upper band = strong uptrend (NOT reversal) |
| Mean reversion (range-bound) | Bounces off upper/lower band in non-trending markets |
| Best paired with | Squeeze breakouts: Bollinger inside Keltner channels |
| %B (band position) | 0 = lower band, 1 = upper band, 0.5 = mid |
| Bullish setup | Squeeze + breakout above upper band with volume |
| Bearish setup | Squeeze + breakdown below lower band with volume |
| Common mistake | Fading 'overbought' touches in strong trends |
Quick setups
- Squeeze breakout long: Bands narrow inside Keltner channels + price breaks above upper Bollinger with volume = entry.
- Mean reversion in range: Range-bound asset + price hits lower band + reversal candle = long entry with stop below band.
- Walking bands continuation: Price already above upper band in uptrend + small pullback to 20-SMA + bounce = continuation entry.