Volatility Bands are calculated each night for over
1200 optionable symbols. The file containing
the the Levels are downloaded by
Stormtracker when it's started
each market day (it only takes a
few seconds). Here is a list of
symbols that Volatility Bands
are calculated for each day
VolBand68,
VolBand80, VolBand88, VolBand95
(studies)
With
the Volatility Band Studies,
you're able to choose either the
68% , 80%, 88%, or 95% percent
values. For example if you
choose the 68% Volatility Band,
this will allow you to scan
for a VBup68 value and a VBdn68
value. If the symbol reaches
the VBup68 price level, then
there's a 68% chance for a
reversal to the downside. If
the symbol reaches the VBdn68
price level, then there's a 68%
probability for a reversal to the
upside. Combine these levels
with market internals and reversal
pattens(CandleStick patterns or
moving average crossovers) or an
condition that detect a potential
reversal, in order to make
a higher probability play.
There
are two ways to construct conditions
with the Volatility Band study:
1)
Construct a condition comparing the
VBup68 or VBdn68 output indicator
with the current price of the
symbol(I1CloseI1). This will
tell you if the current price is
above/below the Volatility
Band. If the price has been
above/below the Volatility Band
recently , but is currently not
above/below the band, it will not
tell you this. The second way
to configure allows you to test for
this condition
2)
Construct a condition using the cntc ( contact ) Output
indicator which puts a value of
-2,-1,0,1, or 2. This uses
the BarsBack ( of the
timeframe the study is configured
in) and Percentage
Parameters of the study, to output
a value that tells how recently
the price has been in contact with
the Volatility band. The
values of +-2 override the value of
+-1, so it's recommended that you
construct conditions > 0.99 and
< -0.99 in order to include both
conditions where the price is
above/below the VBand and when the
price is near the VBand, but has
already started to reverse.
In
the following description,
"percent" refers to the configurable
parameter of the study Percent,
while "BarsBack" refers to
one of the other configurable
parameters of the study. It's
recommended that you set
"percent" to 0.
cntc
value
Meaning
-2
price is below lower Volatility
Band
-1
price is close to the lower
Volatility Band (within
"percent") in the
last "BarsBack" bars.
0
Not within range of either
Volatility Band
1
price is close to the upper
Volatility Band (within
"percent") in the
last "BarsBack" bars.
2
price is above the upper
Volatility Band
Using
the Cntct(Contact) Output
Indicator
DefaultPercentage
- this is used in order to set a
default Volatility Band value for
those symbols in your scan list for which Volatility Bands are
not calculated (symbols that are not
in the list downloaded daily from
the Stormchaser website). We've found
that a value of 2.5% works well as a
setting if you wish to include non-VBand
symbols and still be alerted
to potential reversals for these
symbols. You
can also use this setting to filter
out stocks in your list for which
the volatility bands are not
calculated, by setting it to a high
value, for example 20%
By doing this you won't have to
manually remove the symbols in your
list for which Volatility Bands
aren't calculated
Dynamic
Levels - The Levels at 9:30 are
approximately 75% of the levels when
compared to the levels end of the
trading day. In other words
the Volatility Bands are at the
extreme at the end of the trading
day , having increased steadily
throughout the day, reflecting that
as the trading day progresses, the
levels that must be reached for a
probable reversal are increasing for
tops, and decreasing for bottoms
Examples:
SPY
Volatility Bands
BUD
Volatility Bands
VolBandHL68,
VolBandHL80, VolBandHL88,
VolBandHL95 (studies)
These
studies are similar to the normal
Volatility band studies, the only
difference is that while the
normal Volatility Bands studies
calculate the Bands from the
previous day's close, the
"HL" studies calculate
the bands from the intraday High
or Low. These can be useful
to detect reversals on days where
there is considerable volatility
or if there is intraday volatility
that doesn't reach the EOD
Volatility Bands( the ones
calcualated from the Previous Day's
Close.
VolBandHL68
Example with RIG(Same chart as
Contact example above)
