Definitions
In plain terms
Zero corresponds to the lower band, one to the upper band, and one-half to the middle when the bands are symmetric.
Technical
The ratio is (close minus lower) divided by (upper minus lower) and is unavailable when the bands have zero width.
Scope
Percent B is not mathematically bounded; closes outside the bands produce values below zero or above one.
Formula
Percent B = (close - lower band) / (upper band - lower band)\%b_t=\frac{C_t-L_t}{U_t-L_t}| Symbol | Meaning | Unit |
|---|---|---|
C_t | current close | price units |
U_t | upper band | price units |
L_t | lower band | price units |
Output unit: ratio
Examples
- A reviewer traces Bollinger Percent B from aligned inputs through its first-ready row and edge cases before accepting a displayed value.
Common misconceptions
- Percent B is not mathematically bounded; closes outside the bands produce values below zero or above one.
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.
- 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