Acceleration bands indicator

Acceleration bands indicator

Price Headley presents in his book "Big Trends in Trading" the Acceleration Bands indicator. Fundamental advantage of the approach is the opinion Headleys following a marked improvement in the Bollinger bands, particularly with regard to the use in trending markets and to develop strategies outbreak.

Acceleration Bands indicator explained: usage, trading examples. Trading with Acceleration Bands at Forex indicators Guide. The trading approach is fundamentally based on a fundamental basis, and several small breakout strategies. Headley moves in markets, which promise an equally high level as long-lasting profit growth. To mention in this context, for example, Biotecs, technology or the telecommunications industry. Reduced to the essentials Headly is assumed that the optimal entry point can be found in small bursts of narrow margins in or near all-time yearly high. He believes can prove that the statistical probability for a winning rally in a 15% margin for the year highs particularly significant. The strategy should also work for short sales to the same extent.

The approach is based essentially, on a deliberate contrast to the widespread especially beginners error, which can mean only to make profit when they buy "on the ground". Acceleration bands are a popular indicator for gauging the volatility of a stock's price action. Acceleration Bands turn the filter out shares, which are already in a trend-like course. The disadvantage of the Bollinger bands Headley looks in particular to their short reaction time and the rather late onset of the courses from the tapes.


The Acceleration Bands indicator created by Price Headley serve as a trading envelope that factor in a stock's typical volatility over standard settings Technical analysis provides for the calculation is as follows:
Upper Band = (high * (1 + 2 * ((((high - low) / ((high + low) / 2)) * 1000) * Factor)))
Lower Band = (low * (1-2 * ((((high - low) / ((high + low) / 2)) * 1000) * Factor)))

The result of this rather complicated-looking formula for a smoothing by a moving average are two quite sluggish following the exchange rate bands. While weak Trendpasen of course it is completely covered. There are two variable parameters, and the period of transfer factor. The degree of smoothing and the inertia of the bands is determined by the period, the essential factor controlling the movement of the volatility of the underlying asset, to leave the bands.

Consequently, the entry point (the bandwidth of course leaves up) Headley sees the optimum exit time of re-entering the course in the Acceleration bands. He also recommends an entry confirmation signal in the form to be seen that two consecutive closing prices are above the upper acceleration band.