combination of Bollinger and Hammer at sensex chart

Bollinger Bands draw their power through two important characteristics. First, they exhibit an underlying trend-range axis just like price or moving averages. Second, they constrict or expand as they move. The interaction between these two forces draws unique patterns as bars unwind through its boundaries. Candlesticks work especially well with bands. For example, a Doji that strikes through a constricting band effectively signals a short-term reversal.

BBs bend and twist in response to price movement. These undulations predict how far trends should stretch before central tendency forces them back toward a central axis. Complex relationships develop between price-band direction and price-band constriction. For example, a trend tends to pause when constricting bands oppose it. It takes great skill to predict the bands' ultimate impact on price but is well worth the effort. More than any other tool, BBs pinpoint hidden swings and telegraph whether the profit door lies open or closed.