Stock market moves in a highly chaotic way, but at a larger scale, the movements follow a certain pattern that can be applied to shorter or longer periods of time and we can use Fractal Chaos Bands Indicator to identify those patterns. Basically, the Fractal Chaos Bands Indicator helps us to identify whether the stock market is trending or not. When a market is trending, the bands will have a slope and if market is not trending the bands will flatten out. As the slope of the bands decreases, it signifies that the market is choppy, insecure and variable. As the graph becomes more and more abrupt, be it going up or down, the significance is that the market becomes trendy, or stable. Fractal Chaos Bands Indicator is used similarly to other bands-indicator (Bollinger bands for instance), offering trading opportunities when price moves above or under the fractal lines.
The FCB indicator looks back in time depending on the number of time periods trader selected to plot the indicator. The upper fractal line is made by plotting stock price highs and the lower fractal line is made by plotting stock price lows. Essentially, the Fractal Chaos Bands show an overall panorama of the price movement, as they filter out the insignificant fluctuations of the stock price.
Hello, very good script man! Thank you I propose a modification to you, or ask for your help to do it myself. Only draw lines if the last 2 fractals are opposite. If the last 2 fractals are in the same direction, don't draw lines. I am trying to write a code with the Stpatterns strategy
variousSwift55903
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Hi can you please help me create improved version of fractal chaos bands. I would definitely would like to pay for you service.. apparently i cannot DM you...hence using comments. We can connect and discuss the formula.