Description
Volatility Meter Indicator
Overview: The “Volatility Meter” indicator is a tool designed to assess market volatility, providing insights into potential price movements. Developed by Rodopa Capital, this indicator calculates various metrics to gauge the current market conditions and assist traders in making informed decisions.
Parameters:
- Length: 7 (Adjustable) – Specifies the period for calculations.
- Range Decimals: 3 (Adjustable) – Determines the precision of range values.
- Average Volatility Price Range Period: 90 (Adjustable) – Defines the period for calculating average volatility.
- Source: Closing prices by default.
- Leverage: 30 (Adjustable) – Sets the leverage for position sizing.
- Position Size: $1000 (Adjustable) – Determines the initial position size in dollars.
Key Calculations:
- Linear Regression Curve: Utilizes linear regression to model the relationship between price and time.
- Highest and Lowest Points: Identifies the highest and lowest points in the distance between the actual price and the regression curve.
- Average Ranges: Calculates the average ranges for price and percentage.
Decimal Truncation: Ensures precise values by truncating decimal places as specified.
Table Display: The indicator presents crucial information in a table format, including:
- Expected and average price ranges in dollars and percentages.
- Expected opportunity in dollars based on the average range percentage, leverage, and position size.
Visualization:
- Displays the linear regression curve along with high and low bands.
- Plots the actual price range, average positive and negative ranges in dollars, and percentage ranges (some hidden by default).
Color Coding:
- Differentiates elements with a color scheme for clarity and ease of interpretation.
Conclusion: The “Volatility Meter” indicator equips traders with valuable data to comprehend market volatility trends and potential trading opportunities. Its comprehensive analysis and visual representation make it a valuable tool for traders seeking to navigate dynamic market conditions.
