Bollinger Bands: what do you do when price hits the band?
Price touching a band means volatility has stretched — but stretched markets can stretch further. The mean-reversion play (fade the touch) and the momentum play (ride the band) are opposite trades on the same signal.
Which are you?
- how you decide between fading and riding
- the confirmation you need before acting on a band touch
- how bands fit with your other filters
The Bollinger Bands guide covers both interpretations.
Background: Bollinger Bands explained: the squeeze, band walks and mean reversion
Bollinger Bands wrap a moving average in two volatility bands. Learn how they're calculated, what a squeeze means and why touching a band isn't a signal on its own.
What are the standard Bollinger Bands settings?
A 20-period simple moving average, with bands 2 standard deviations above and below it.
Is touching the upper Bollinger Band a sell signal?
Not on its own. In a strong uptrend price can ride the upper band for a long time. A touch shows price is stretched relative to recent volatility, which needs other evidence before it becomes a trade.
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