Ian Woodward's Investing Blog

Stock Market: Bollinger’s “Bandwidth” Rules the Roost Right Now

My good friend Paul Reiche made an astute observation when comparing %B versus %B x BW and wondered why the colors are not in “Sync” as shown in chart 7 below.  The value of the Woody Indicator (%B x BW) is to give a faster look at the market movement as he rightly says and at such times it pays to turn your attention to what the Bandwidth is doing!  I will cover this scenario in charts 7 to 10 below.

2015-05-03 Blog Fodder

Let’s first look at the Market Indexes to show the lay of the land and as you would expect it has been a choppy market to say the least for the past month:

2015-05-03 Blog Fodder2

The Canaries haven’t faired much better though NFLX and PCLN have been the stars with LNKD just taking a wallop:

2015-05-03 Blog Fodder3

Note that the Internals of the Market as viewed by the Accum. vs. Dist. Ratio also show that we are at Stalemate:

2015-05-03 Blog Fodder4

The choppiness we have had to put up with is quickly evident in this next favorite chart of ours:

2015-05-03 Blog Fodder5

…And here is the Drummers Chart which also shows the signs of a Choppy Market:

2015-05-03 Blog Fodder6

Now for Paul Reiche’s astute observation below:

2015-05-03 Blog Fodder7

So let’s go back in time and then bring us forward to date to see what happened in a similar situation:

2015-05-03 Blog Fodder8

…And here is the follow on chart which shows how everything got back in sync!

2015-05-03 Blog Fodder9

Lastly, we are back up to date and so we keep a beady eye on the behavior of the Bandwidth to ultimately bring us back into sync:

2015-05-03 Blog Fodder10

Let’s see what transpires over the next week or so.  Hopefully things will right themselves in the fullness of time!

Best Regards,


Copyright © 2007-2010 Ian Woodward
Disclaimer: Commentaries on this Blog are not to be construed as recommendations to buy or sell the market and/or specific securites. The consumer of the information is responsible for their own investment decisions.