Band Reversion Trainer

Price just tagged a Bollinger band. Is that a fade back to the middle band, or the start of a band walk, or a squeeze letting go? Decide, get graded, see the next 8 bars. The bands are John Bollinger's, 20-period with 2 standard deviations, as set down in Bollinger on Bollinger Bands (2001), with his rule that a band tag on its own is not a signal. The Keltner channel underneath is 20-period, 1.5 ATR, and when the Bollingers sit inside it that's John Carter's squeeze (Mastering the Trade, 2005): the one time a band tag means breakout, not reversion.

How it grades. 5 situations, drawn at random. Fade: the bands are flat (bandwidth inside its last 20 bars' middle half), price tags or pokes through a band, and the bar closes back inside. Fade it, target the middle band, stop past the wick. Band walk: 4 of the last 5 closes have %b above 0.85 or below 0.15 while the middle band slopes. Bollinger's own warning: tags in a walk are continuation, not reversal. No fade. Squeeze break: the Bollingers are inside the Keltner channel and a bar closes outside the Bollinger band. That's stored energy leaving, not a stretch. No fade. No tag: price is inside the bands. Nothing to do. %b = (close minus lower band) / (upper minus lower). Bandwidth = (upper minus lower) / middle. Hard mode hides the reveal hints until you answer and drops the Keltner channel. Keyboard: L S N, then Enter for the next rep.

Educational tool only, not financial advice. Charts are synthetic and built to show textbook band behavior. Live bands lie more often, and a 2σ tag on a trend day is where the trend gets paid.

Built by Jason Parker, founder of Trading Ranges.