Bollinger Band

The Bollinger Bands consist of two lines, one higher and another lower. The higher corresponds to the sum of the SMA from the previous n-period and the standard deviation of the price in the same n-periods. The lower line is the subtraction of the SMA from the previous n-period and the standard deviation of the price in the same n-periods. The higher the volatility that is present in the market higher the standard deviation and the bands will be wider, and vice versa.