Definitions
In plain terms
It moves below the center as dispersion grows and collapses onto the center when dispersion is zero.
Technical
The lower band must use the same aligned basis and deviation window as the rest of the Bollinger contract.
Scope
A touch or close below the lower band is a location observation, not an automatic buy instruction.
Formula
Lower band = middle band - k * standard deviationL_t=M_t-k\sigma_t| Symbol | Meaning | Unit |
|---|---|---|
M_t | middle band | price units |
k | deviation multiplier | ratio |
sigma_t | rolling standard deviation | price units |
Output unit: price units
Examples
- A reviewer traces Bollinger Lower Band from aligned inputs through its first-ready row and edge cases before accepting a displayed value.
Common misconceptions
- A touch or close below the lower band is a location observation, not an automatic buy instruction.
Concept relationships
Where this concept is used
Evidence and governance
- Bollinger Bands Rules John Bollinger · first party methodology
Supports: preferred label, short definition, technical definition, formula
Limits: Interpretive rules do not prove forecasting power, trade profitability, or one universal parameter selection.
- Bollinger Bands TradingView · official platform documentation
Supports: preferred label, short definition, technical definition, formula
Limits: Platform behavior and interpretation are not universal standards and do not replace the local frozen variant.
- TA-Lib Bollinger Bands TA-Lib · first party technical publication
Supports: preferred label, short definition, technical definition, formula
Limits: TA-Lib permits moving-average variants beyond the local close-SMA and population-deviation contract.
- Reviewed by
- fintech-builder-batch-009
- Last reviewed
- 2026-07-30
- Next review
- 2027-07-30
- Record status
- published