Backtrader Indicator Guide

Backtrader Bollinger Bands Breakout Strategy

Volatility indicator consisting of a middle band (SMA) and two outer bands (standard deviations above/below). Bands expand during high volatility and contract during low volatility.

bt.indicators.BollingerBandsBreakout Trading Strategies

Indicator Explanation

Volatility indicator consisting of a middle band (SMA) and two outer bands (standard deviations above/below). Bands expand during high volatility and contract during low volatility.

Strategy Context

Bollinger Bands excel at breakout detection. When bands contract (low volatility "squeeze"), a significant price move is imminent. Breakout strategies enter when price closes above the upper band (bullish breakout) or below the lower band (bearish breakout), riding the volatility expansion.

Learn more about Breakout Trading Strategies →

Backtrader Implementation

Pythonbacktrader

import backtrader as bt

class BollingerBreakout(bt.Strategy):
    params = (('period', 20), ('devfactor', 2.0))

    def __init__(self):
        self.bb = bt.indicators.BollingerBands(self.data.close,
                                                period=self.p.period,
                                                devfactor=self.p.devfactor)

    def next(self):
        # Price breaks above upper band = bullish breakout
        if self.data.close[0] > self.bb.lines.top[0] and self.data.close[-1] <= self.bb.lines.top[-1]:
            self.buy()
        # Price breaks below lower band = bearish breakout
        elif self.data.close[0] < self.bb.lines.bot[0] and self.data.close[-1] >= self.bb.lines.bot[-1]:
            self.sell()

Parameter Recommendations

Parameter	Default	Description
period	20	SMA period for middle band
devfactor	2	Standard deviation multiplier for outer bands

Related Strategy Types