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Quick Summary
Breakout outside Acceleration bands suggest a beginning of a strong rally or a sell-off.
Closing inside the bands afterward signals about the end of a rally or a sell-off.
Details
The idea behind Acceleration Bands indicator
Acceleration Bands principal use is in finding the acceleration in currency pair price and benefit as long as this acceleration preserves.
How to interpret Acceleration bands indicator
Acceleration bands are set as an envelope around a 20 period simple moving average on equal distance from it. Headley, the inventor of Acceleration Bands indicator suggests using them on weekly and monthly time frames to determine price acceleration breakouts (breakouts outside the bands).
When Acceleration Bands are used for smaller time frames, upper and lower bands are treated as levels of possible support and resistance.
How to trade with AB indicator
2 consecutive closes outside Acceleration Bands suggest an entry point in the direction of the breakout. Then position is kept till the first close back inside the Bands.
Acceleration Bands indicator on the chart
The formula for Acceleration Bands
Upperband = ( High * ( 1 + 2 * (((( High - Low )/(( High + Low ) / 2 )) * 1000 ) * Factor )));
Lowerband = ( Low * ( 1 - 2 * (((( High - Low )/(( High + Low ) / 2 )) * 1000 ) * Factor )));
Factor=0.001
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where i can find this indicator for mt4 o ninjatrader
I got it for you:
thanks
i'm looking for efficenty ratio by kafman , is very profitable with accelleration bands
frank
so far, I was able to find only this: EfficiencyRatio.mq4
AdaptiveEMA.mq4
Kaufman_Bands.mq4
How do I download band to my metatrader platform? It will not download.
To download:
Right mouse click + Save target as... for Internet Explorer
Right mouse click + Save link as... for Firefox
Besides you can create a file called indicatorname.mq4 right on your computer and copy a code you see on the screen there.
To add this indicator to your MT4, copy it to /experts/indicators/, restart the platform and find the indicator under Custom indicators
this band is only for long entry? or how to use for short
Swing Trading Strategy. Superimpose acceleration bands and Donchian channels on your chart. Look for the following:
ENTRY
Candles - low, lower low, then higher low for entry
Lower line of Donchian channel should enter/intersect lower line of Acceleration Band
on "south west" corners
EXIT trailing stop on lower line of Acceleration Band
exit on north east corners as soon as top line of Donchian Channel exits Acceleration Band,
i.e. high, higher high, lower high
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