What are Bollinger Bands? How to use Bollinger bands for successful trading?

These were invented by John Bollinger. It is calculated using standard deviation and mean averages. The calculation if these bands is pretty complex. So let us focus on understanding How to use Bollinger bands for trading. If you plot the Bollinger bands on your chart, then it creates kind of an envelope or upper and lower boundaries to the chart values. If the stock is trending then the price often breaks either of the ranges. If the stock is not trending then you can see that the price bounces from upper band to lower band and vice versa. It is useful to understand if the market has a momentum or is sluggish. Please click here Trading with bolinger bands to understand how you can trade with Bollinger Bands.