Bollinger Bands are a technical analysis tool invented by the famous technician John Bollinger. It is composed of a set of lines plotted two standard deviations, both positively and negatively, away from a simple moving average (SMA) of the asset. They are also the upper band, lower band and the middle band respectively.
(A standard deviation is just a measure of how far away the currency price is from its average or typical price.)
Bollinger Bands are a tool for measuring volatility, when the market becomes more volatile the bands are widened, conversely when the market becomes less volatile the bands are contracted.
The upper band and lower band actually act as dynamic resistance level and support level. When the currency price continually touches the upper band, it could be considered as reaching the resistance level and hence overbought; when the currency price continually touch the lower band, it could be considered as reaching the support level and hence oversold.