Bollinger Bands Bitcoin Indicator Bulge and Squeeze Analysis
The BTCUSD Crypto Bollinger Bands are self adjusting which means the bands widen and narrow depending on bitcoin price volatility.
Standard Deviation is the statistical measure of the bitcoin price volatility used to calculate the widening or narrowing of the bitcoin Bollinger bands. Standard deviation will be higher when bitcoin prices are changing significantly and lower when the btcusd market bitcoin prices are calmer.
- When bitcoin price volatility is high the Bollinger Bands widen.
- When bitcoin price volatility is low the Bollinger Bands narrows.
The Bollinger Band Squeeze
Narrowing of bitcoin Bollinger Bands is a sign of bitcoin price consolidation & is known as the Bollinger band squeeze.
When the Bollinger Bands cryptocurrency indicator display narrow standard deviation it is usually a time of bitcoin price consolidation, and it is a signal that there'll be a bitcoin price breakout and it shows bitcoin traders are adjusting their trade positions for a new move. Also, the longer the bitcoin prices stay within the narrow bands the greater the chance of a bitcoin price break out.
Bollinger Squeeze - The Bollinger Bands Squeeze - How to Crypto Trade Bollinger Bands Squeeze
The Bollinger Bulge
The widening of Bollinger Bands is a sign of a bitcoin price breakout & is known as the Bollinger Bands Bulge.
Bollinger Bands that are far apart can serve as a signal that a bitcoin trend reversal is approaching. In the Bollinger bands indicator example illustrated below, the bitcoin Bollinger bands get very wide as a result of high bitcoin price volatility on the down swing. The btcusd crypto trend reverses as btcusd crypto prices reach an extreme level according to statistics and the theory of normal distribution. The "bulge" predicts the change to a crypto downward trend.
Bollinger Bulge - The Bollinger Bulge - How to Crypto Trade Bollinger Band Bulge
