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What is the best Volatility indicator?

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185
rubencouto 2008.12.02 16:45
 

Hello!

In your opinion wich one is the best volatility indicator?

Standard Deviation

Average True Range

Bolinger Bands

Other?

How do you use it to trade?

Thanks!

 
Good R:R trade on AUDUSD Sell
Good R:R trade on AUDUSD Sell
Zheng He | 21 November 2014, 06:49 | Views: 105
Here's actually another trade quite recently made. This is on the AUDUSD as it approaches a key resistance level. Bias is towards the price reversing from it rather than breaking through.  This resistance level was tested once already. Previously it acted as a support, but again recently broke through.
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1936
BarrowBoy 2008.12.03 14:45 #
 

RC

Standard Deviation is a measure of Bollinger Band width, so counts as the same.

In general I find ATR is less laggy than Bollinger Bands
For both ATR & StdDev, I find a threshold for go/no go on trending strategies, eg if ATR below n.nn dont trend-trade

Also dont forget that ATR on the longer timeframes can indicate a 'good' day or otherwise for trend plays

You might reverse the logic for range-based strategies

And.. dont forget ADX

You must study these in relation to the chosen pair & time-frame & remember that a successful EA will generally look at more than just one time-frame for confirmation...

FWIW

-BB-

 
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185
rubencouto 2008.12.03 15:07 #
 
BarrowBoy wrote >>

RC

Standard Deviation is a measure of Bollinger Band width, so counts as the same.

In general I find ATR is less laggy than Bollinger Bands
For both ATR & StdDev, I find a threshold for go/no go on trending strategies, eg if ATR below n.nn dont trend-trade

Also dont forget that ATR on the longer timeframes can indicate a 'good' day or otherwise for trend plays

You might reverse the logic for range-based strategies

And.. dont forget ADX

You must study these in relation to the chosen pair & time-frame & remember that a successful EA will generally look at more than just one time-frame for confirmation...

FWIW

-BB-

Thanks!!

Right now, my EA Kanguru is using ADX, PSAR, Stochastic, ATR, Standard Deviation and MACD, on H4, H1, M30 and M15, all mixed toghether! It looks ok because from 10.000 I'm getting around 1.000.000, backtesting the AUD-USD, around 17% drawdown and a profit trades percentage of around 70%, from 01-01-2008 until today. The problem is that whe I try to test it on diferent time periods, such as previous to 2008, I get big losses. So I'm looking for a way to filter out some false signals...

Thanks for your help!

:)

 
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