BB Width + %B - All-in-One!

The BB Width + %B - All-in-One! indicator provides a unified oscillator view of Bollinger Band dynamics by combining Bandwidth and %B metrics into a single pane for efficient volatility and trend analysis.

Usage

The Usage section focuses on interpreting the relationship between price position and volatility.

• %B Analysis: The line oscillates around a 0.5 center line. A value of 1 represents the upper band, while 0 represents the lower band. Users can identify overbought or oversold conditions relative to the bands when the line exceeds these boundaries.
• BB Width Analysis: The background area plot represents the Bollinger Band Width, scaled by a multiplier. Expanding areas indicate increasing market volatility (expansion), while contracting areas suggest decreasing volatility (squeezes).
• Combined Signals: Traders can look for "squeezes" (low BB Width) followed by %B breakouts (crossing 0 or 1) to identify potential high-momentum trend starts.

Details

The script calculates standard Bollinger Bands using a Simple Moving Average (SMA) and Standard Deviation.

• %B Calculation: (Price - Lower Band) / (Upper Band - Lower Band). This normalizes price position within the bands.
• BB Width Calculation: (Upper Band - Lower Band) / Basis. This measures the percentage spread of the bands.
• Scaling: The indicator includes a "BBW Multiplier" to scale the width metric, allowing it to be visually comparable to the %B line across different asset classes and volatility regimes.

Settings

• Length: The lookback period for the SMA and Standard Deviation calculation (default is 20).
• Source: The price data point used for calculations (default is Close).
• Standard Deviation: The multiplier for the bands' width (default is 2.0).
• BBW Multiplier: A scaling factor used to adjust the visual height of the Bollinger Band Width area plot to fit various market conditions.

FAQ

How do I interpret the shaded area?

The shaded area represents the BB Width. When the area is small/low, the market is in a squeeze; when it grows larger, volatility is increasing.

What do the horizontal lines represent?

The solid lines at 0 and 1 represent the Lower and Upper Bollinger Bands respectively. The dotted line at 0.5 represents the baseline (SMA).

How can I access BB Width + %B - All-in-One!?

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