The idea after this indicator formula can be described in the following steps:
- Calculate the center line of Donchian Channel.
- Add Standard deviation to Donchian Channel center line to get Upper Band.
- Subtract Standard deviation from Donchian Channel to get Lower Bands.
How to use Bermaui Bands
- As trend following indicator, when candles close higher than center line then trend is up and when price closes lower than center line then trend is down.
- Use Bermaui Bands as a filter to help you identify trend direction.
- Trade with your usual trading tools in the direction of Bermaui Bands only to eliminate false signals as much as possible.
- As trend reversal indicator, when candles close outside the upper or lower bands then there is a high probability that they will revert to the mean or the center of the bands.
- Use suggested entry arrows to help you finding strong reversal points to start from.
Bermaui Bands Features
- Well-designed style that user can control.
- Buy, Sell arrows to help identifying trend signals.
- Sound, email alerts depending on user choice.
Bermaui Bands inputs
- Channel_Candles = Number of candles used in bands calculations(default is 20 candles).
- Deviation_Candles = Number of candles used to calculate standard deviation(default is 40 candles).
- Deviation_Price = Price used in calculating standard deviation (default is Close).
- MA_Method = Moving Average method used in standard deviation calculation (default is Simple Moving Average).
- Deviation_Multiplier = This parameter will help you to control Bermaui Bands width or how much far the bands can be away from the center line(default is 1.5).
- UpperBand_color = Color of the upper band.
- MedianBB_color = Color of the Center band.
- LowerBand_color = Color of the lower band.
- UpArrow_Color = Color for buy arrows.
- DnArrow_Color = Color for sell arrows.
- Show_Signal = Show or hide arrows options.
- Alerts = Choose to use or stop alert sound and message.
- eMail_Send = Option to send email to the user when an alert is true.
- eMail_Header = The head of the email message sent to the user.
- eMail_subject = The subject written inside the message sent to the user.
- Notification_Send = Option to send notification to the user.
I hope you find BB a good investment tool for you.