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After the Bollinger Bands narrow to under 5% of price, buy a close above the upper band; sell below the middle band.
Bollinger Squeeze Breakout on Nifty IT from Dec 2005 to Nov 2026: CAGR 3.0%, max drawdown 31.6%, win rate 49.0% over 49 trades, vs buy-and-hold 10.7%.
As of · Hypothetical backtest by Jivani Markets on Nifty IT daily data; re-run weekly
| Measure | Bollinger Squeeze Breakout | Buy and hold Nifty IT |
|---|---|---|
| CAGR (annual return) | 3.0% | 10.7% |
| Total return | 87% | 736% |
| Max drawdown | −31.6% | −65.7% |
| ₹10 lakh became | ₹18.7 lakh | ₹83.6 lakh |
| Win rate | 49.0% | — |
| Trades (closed) | 49 | — |
| Winning / losing trades | 24 / 25 | — |
| Profit factor | 2.21 | — |
| Sharpe ratio | 0.43 | — |
| Volatility (annual) | 7.9% | — |
| Time in the market | 18% | 100% |
| Average holding | 18 sessions | — |
| Charges and slippage paid | ₹2,95,549 | — |
# Bollinger Squeeze Breakout on Nifty IT
universe("NIFTY IT", asset="index")
settings(
timeframe="1d",
entry_timing="next_open",
cost_model="retail",
slippage_model="tiered",
start="2006-01-01",
benchmark="NIFTY IT",
allow_short=False,
participation_ignore_zero_volume=True,
)
exit_when(close() < bollinger(20, deviations=2, output="middle"))
buy(all_of(recently(bollinger(20, deviations=2, output="width") < 5, 5), close() > bollinger(20, deviations=2, output="upper")), size=percent_of_equity(100))
| Year | Strategy | Buy and hold |
|---|---|---|
| 2026* | 0.0% | −14.3% |
| 2025 | −0.5% | −12.6% |
| 2024 | −7.0% | +22.0% |
| 2023 | +13.5% | +24.1% |
| 2022 | 0.0% | −26.0% |
| 2021 | +23.7% | +59.6% |
| 2020 | +36.8% | +54.9% |
| 2019 | −2.2% | +8.4% |
| 2018 | +18.4% | +23.8% |
| 2017 | −0.6% | +12.2% |
| 2016 | −5.9% | −7.3% |
| 2015 | −3.5% | 0.0% |
| 2014 | +8.4% | +17.8% |
| 2013 | +21.1% | +58.0% |
| 2012 | −13.7% | −1.9% |
| 2011 | −3.6% | −18.1% |
| 2010 | −0.8% | +28.8% |
| 2009 | 0.0% | +166.0% |
| 2008 | −8.4% | −54.6% |
| 2007 | −3.3% | −11.4% |
| 2006 | +4.7% | +39.9% |
| Bought | At | Sold | At | Return |
|---|---|---|---|---|
| 13 Nov 2025 | 36,993.36 | 30 Dec 2025 | 38,224.13 | +3.1% |
| 26 Aug 2025 | 36,160.96 | 5 Sept 2025 | 35,181.9 | −2.9% |
| 12 Jun 2025 | 38,791.05 | 10 Jul 2025 | 38,655.73 | −0.6% |
| 24 May 2024 | 34,075.69 | 31 May 2024 | 32,683.7 | −4.3% |
| 17 Nov 2023 | 32,337.33 | 4 Jan 2024 | 34,501.12 | +6.5% |
| 4 Sept 2023 | 31,599.83 | 29 Sept 2023 | 31,766.93 | +0.3% |
| 3 Jul 2023 | 29,692.87 | 25 Jul 2023 | 29,854.15 | +0.3% |
| 17 Jan 2023 | 29,335.09 | 27 Feb 2023 | 30,293.19 | +3.0% |
| 16 Jul 2021 | 29,779.35 | 29 Sept 2021 | 34,842.56 | +16.8% |
| 27 May 2021 | 26,962.18 | 12 Jul 2021 | 28,793.8 | +6.6% |
From 30 Dec 2005 to 9 Nov 2026, these Bollinger Squeeze Breakout rules on the Nifty IT index returned a CAGR of 3.0% after costs, less than the 10.7% a year from buying and holding the index, with a worst fall of 31.6% against 65.7% for buy-and-hold. It made 49 trades and was invested 18% of the time. This is a hypothetical test on past data, not a recommendation, and past performance is not indicative of future results.
49.0%: 24 of 49 closed trades made money after charges and slippage. On a ₹10 lakh account the average winning trade made ₹66,100 and the average losing trade lost ₹28,728; the profit factor (gross profit ÷ gross loss) was 2.21. A high win rate with small wins can still lose money, so read it with the CAGR and drawdown.
Buy: Band width was under 5% in the last 5 sessions and the close is above the upper band. Sell: The close falls below the middle band. One position at a time with all of the capital; out of the market (in cash, earning nothing) between trades. Daily candles, long only, orders filled at the next session's open.
Buying and holding the Nifty IT index over the same dates returned 10.7% a year with a worst fall of 65.7%; the strategy returned 3.0% a year with a worst fall of 31.6%. A strategy that is out of the market part of the time usually gives up some return in rising years in exchange for missing part of the falls; the year-by-year table on this page shows where each one gained or lost.
Retail delivery charges (STT, exchange and SEBI fees, stamp duty and GST) and size-based slippage on every buy and sell; signals are read on the daily close and filled at the next session's open; price return only, so dividends are left out of both the strategy and buy-and-hold. An index cannot be bought directly; a fund or ETF that tracks it adds its own expense ratio and tracking error, and pays dividends this price-index test leaves out.
Yes. The "Run it yourself" link opens these exact rules in the Jivani Markets backtest builder, where you can change the indicator settings, add a stop-loss, pick other stocks or indices and re-run it on the latest data.