The single most useful thing Bollinger Bands tell you is not direction but volatility state. Volatility is cyclical: it contracts and expands in waves. When the bands pinch tight (a squeeze), volatility is low and coiled — and low volatility tends to precede high volatility. The squeeze is the chart warning you that a big move is being loaded.
Reading the squeeze
When the bands narrow to an unusually tight range, the market is consolidating and energy is building. The expansion — bands suddenly widening — signals the move has begun. The squeeze does not tell you which way price will break; it tells you that a break is coming and to be ready. Direction comes from other tools (structure, the breakout itself, volume).
Trading it
The squeeze is a setup, not a trigger. Mark the consolidation's high and low during the squeeze; trade the breakout when the bands expand and price closes beyond one edge on volume. Beware the false break — squeezes are notorious for a quick fake-out one way before the real move, so the retest of the broken level often gives a cleaner entry. The longer and tighter the squeeze, the larger the expansion tends to be.
A universal idea
This contraction-then-expansion rhythm is not unique to Bollinger Bands — it is the same coiling energy behind triangles, pennants, and tight ranges. The squeeze just measures it numerically. Pairing a Bollinger squeeze with a chart consolidation pattern (a triangle in a tight range) is a strong, multi-tool confirmation that a volatility expansion is near.