Simply put, the more the asset become overvalued/undervalued, the tighter the channel would be and every breakout of the bands announces a return back into the channel in near future.
By default, the multiplier of the standard deviation in the indicator settings is set to 2 which means only less than 5% of price actions would appear outside the bands. Also the default multiplier of the ATR is set to 3 which leads to some similar result, but to achieve more strict results setting StDev multiplier to 3 and ATR multiplier to 4 would be useful.
The type of the central moving average could be picked up from 6 different types which are:
- ( )
- ( )
- ( )
- ( )
- TMA (Triangular Moving Average)
- MAEMA (My Personalized Momentum Adjusted )
The latter one leads to a useful combination of the channel with the momentum.
Also the script has multi-timeframe features and the user could apply calculations from other time frames to the current chart.
Hope the idea would be helpful!
- Added an option to colorize the MA based on detected trend
Nello spirito di condivisione promosso da TradingView, l'autore (al quale vanno i nostri ringraziamenti) ha deciso di pubblicare questo script in modalità open-source, così che chiunque possa comprenderlo e testarlo. Puoi utilizzarlo gratuitamente, ma il riutilizzo del codice è subordinato al rispetto del Regolamento. Per aggiungerlo al grafico, mettilo tra i preferiti.
"By default, the multiplier of the standard deviation in the indicator settings is set to 2 which means only less than 5% of price actions would appear outside the bands."
Are you referring to the upper and lower bands?
If you like the math, you could start by reading this article: