Triple VWAP Bands with Upper % and Lower %

The Triple VWAP Bands with Upper % and Lower % indicator provides a dynamic price range centered around the Volume Weighted Average Price (VWAP), allowing traders to identify potential overbought and oversold conditions based on percentage-based deviations.

Usage

The Usage section describes how the script can be used to identify trend exhaustion and mean reversion opportunities. Traders can use the central VWAP line as a baseline for value, while the upper and lower bands act as dynamic resistance and support levels. When price action extends toward the upper band, it may indicate an overbought state, whereas movements toward the lower band may suggest the asset is oversold relative to its volume-weighted average.

The script is particularly useful for:

• Mean reversion strategies looking for price to return to the VWAP baseline.
• Trend following by observing how price respects the bands during a strong move.
• Volatility analysis by adjusting the percentage offsets to capture price extremes.

Details

This script calculates the standard Volume Weighted Average Price (VWAP) as its core component. Unlike standard Bollinger Bands which use standard deviation, this indicator utilizes user-defined percentage shifts to create the bands. This provides a more linear and predictable channel relative to the current price level. The upper band is calculated by adding the specified percentage deviation to the VWAP, while the lower band is calculated by subtracting the specified percentage deviation.

Settings

• upper_percentage_deviation: Determines the percentage shift above the VWAP for the upper band calculation (e.g., 0.025 represents 2.5%).
• lower_percentage_deviation: Determines the percentage shift below the VWAP for the lower band calculation (e.g., 0.025 represents 2.5%).

FAQ

How do I use the alerts in this script?

The script includes built-in alerts that trigger when the price closes above the upper band or below the lower band, signaling potential entries or exits.

Can I change the sensitivity of the bands?

Yes, by adjusting the percentage deviation inputs in the settings menu, you can widen or narrow the bands to fit the volatility of the specific asset you are trading.

How can I access Triple VWAP Bands with Upper % and Lower %?

You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.