Bollinger Band Squeeze & Breakout
A move outside a symbol's own volatility-adjusted price band — up through the top (breakout) or down through the bottom (breakdown).
What it means
Bollinger Bands plot a moving average with two bands above and below it, spaced by a multiple of the symbol's own recent price volatility (standard deviation). Because the bands widen when a symbol is volatile and tighten when it's quiet, "a normal move" is defined relative to the symbol itself rather than a fixed percentage that would be too tight for a volatile stock and too loose for a calm one. A breakout is a close above the upper band; a breakdown is a close below the lower band. A "squeeze" — the bands pulling unusually tight — is often watched as a sign that a bigger move may be building, in either direction.
How MarketWall calculates it
MarketWall uses a 20-day moving average with bands set 2 standard deviations wide, computed from the prior day's full trading session (not chasing today's still-forming price around) — so an intraday move is judged against yesterday's band. See the Data Sources & Methodology page for the full signal list.
How it's typically used
A breakout above the upper band is often read as confirmation of strengthening upward momentum, especially alongside above-average volume. A breakdown below the lower band reads the same way on the downside. Because the bands are volatility-relative, the same percentage move means something different for a quiet blue-chip versus an already-volatile small-cap — MarketWall's scoring rewards a move that just crossed the band (confirmation without having already run too far) over one that's already extended well past it. A tight squeeze followed by a breakout in either direction is a commonly watched setup, since the tightening itself doesn't say which way the eventual move will go.
Live example right now
FAQ
What settings does MarketWall use for Bollinger Bands?
A 20-day moving average with bands 2 standard deviations wide — the standard Bollinger Band configuration.
Is a breakout always bullish?
It's read as bullish momentum confirmation, but like any single signal it can reverse. MarketWall shows it as one data point, not a standalone recommendation.
Why did a stock 'ran too far' score lower than one that just broke out?
MarketWall's scoring rewards a move that just crossed the band over one that's already extended well past it — a fresher signal, not a stronger one, is what's being surfaced.
See more signals in the interactive walkthrough, read the full Data Sources & Methodology page, or explore it live on a real chart — AAPL or BTC.