Bollinger Bands
Bollinger Bands surround a 20-period moving average with two bands set 2 standard deviations away. They widen and narrow with volatility.
Created by John Bollinger in the 1980s, they consist of a 20 SMA and two bands at plus and minus 2 standard deviations. When volatility rises, the bands spread apart; when the market calms down, they tighten.
A marked tightening, the “squeeze”, often comes before a bigger move, without telling you its direction. In a range, the bands act as boundaries; in a strong trend, price can “walk” along one band for a long time.
Touching the upper band is not a sell signal in itself. Combine the bands with market structure or an oscillator.