CompanyGraph
Normalizes price position between the 20-period Bollinger Bands on a 0-to-1 scale, exposing whether price is at a statistical extreme or near the center of recent dispersion.
%B shows where price sits between the lower and upper Bollinger bands. 0 means at the lower band, 1 at the upper band.
%B shows where price sits between the lower and upper Bollinger bands. 0 means at the lower band, 1 at the upper band.
The calculation:
%B = (Price - Lower Band) / (Upper Band - Lower Band)
Interpreting %B values:
- %B = 1.0: Price at the upper band
- %B = 0.5: Price at the middle band
- %B = 0.0: Price at the lower band
- %B > 1.0: Price above the upper band
- %B < 0.0: Price below the lower band
Trading applications:
- Overbought/oversold: High %B suggests overbought; low %B suggests oversold
- Trend strength: Consistent high %B indicates strong uptrend
- Mean reversion: Extreme %B values often precede reversals
- Divergences: Price making new highs with lower %B can warn of weakness
Advantages of %B:
- Normalised scale: Comparable across different stocks and time periods
- Quantifies position: Precise measure rather than visual interpretation
- Scanning: Easy to screen for stocks at extreme %B levels
%B complements visual Bollinger Band analysis by providing a numerical value that can be used in systematic trading strategies and screening.
How it relates
(Closing PriceClosing price is the last traded price of the period. It's the most common reference price for charts and indicators.−Bollinger Lower (20)The lower Bollinger band is the mid line minus a volatility buffer. Price touching it can point to strong downside or possible exhaustion.)÷(Bollinger Upper (20)The upper Bollinger band is the mid line plus a volatility buffer. Price touching it can signal strong upside or possible overextension.−Bollinger Lower (20)The lower Bollinger band is the mid line minus a volatility buffer. Price touching it can point to strong downside or possible exhaustion.)=%B (Bollinger 20)