Bollinger Bands Commodity Technical Indicator and Commodities Price Volatility

When commodities price volatility is high; commodities prices close far away from the moving average, the commodity Bollinger Bands width increases to accommodate more possible commodities price action movement that can fall within 95 % of the mean.

Bollinger bands commodity indicator will widen as commodities price volatility widens. This will show as bollinger band bulges around the commodities price. When the commodity bollinger bands widen like this it is a continuation commodity pattern and commodities price will continue moving in this direction. This is normally a continuation commodities trading signal.

The Bollinger bands commodity indicator example illustrated and explained below illustrates the Bollinger bulge.

High Commodities Price Volatility - Commodity Bollinger Bands Indicator - Bollinger Band Bulge

When commodities price volatility is low: commodities prices close closer towards the moving average, the width decreases to reduce the possible commodities price action movement that can fall within 95 % of the mean.

When commodities price volatility is low commodities price will start to consolidate waiting for commodities price to breakout. When the commodity bollinger bands indicator is moving sideways it is best to stay on the sidelines and not to place any commodities trades.

The Bollinger bands indicator examples is shown below when the commodity bollinger bands narrowed.

Low Commodities Price Volatility - Commodity Trading Bollinger Bands Indicator - Bollinger Bands Squeeze