Wednesday, December 31, 2008

BollingerBandwidth Indicator for NinjaTrader


NinjaTrader didn't have my favorite indicator already pre-built in, so today I made my first custom indicator for NinjaTrader. The BollingerBandwidth indicator is essentially the same as the Standard Deviation indicator already built in.

The Basic Formula for the BollingerBandwidth indicator is:

Bollinger Band Width = (Upper Band - Lower Band)/Middle Band



As you can see, the Bollingerbandwidth indicator drawn matches the underlying Standard Deviation indicator. The direction of the two will always match each other regardless of the parameters used. With the Bollingerbandwidth indicator that I made, the only real thing that is added is a standard deviation parameter which can be used to reduce or amplify the shape of the indicator to match the standard deviation your using on your Bollingerbands. You could come up with a number of ideas to use the extra StdDev. parameter I've added.



In addition to the basic Bollingerbandwidth indicator I made 2 variations of this indicator which I prefer to use over the standard indicator (All 3 indicators shown in chart above). The first variation I made is an indicator which gives you the raw value between the Upper and Lower Bollingerbands.

Bollinger Band Width Raw = Upper Band - Lower Band

This indicator can be used a number of ways. For example, maybe you want to look for trades where there is a move in a stock of XX pts, or maybe you want to look for when the Raw bollingerbandwidth on ES is greater then XX pts.

The next indicator is my favorite variation of this indicator because it tells me the percentage between the upper and lower bollingerbands.

Bollinger Band Width Percent = ((Upper Band / Lower Band) -1) *100

I like to use this indicator because it is the easiest to understand. For example the standard bollingerbandwidth indicator normally gives values between 0.001-0.01, while the BollingerbandwidthPercent indicator gives you a pecentage of the difference between the upper and lower bollingerband, normally between 0.1-2.0% depending on the range of the move in the stock or futures contract. I like to use this indicator with a combination of other indicators for finding low volatility entry areas and high volatility exit areas.

I've made these indicators available for download for Free at MediaFire.com

BollingerBandwidth Indicators

I've created a new website where I will be posting free Ninjatrader Indicators and strategies. My goal is to make a new indicator or strategy once weekly to share with others. If Traders have ideas or suggestions for me please leave a comment.

12 comments:

cory on 5:11 PM said...

ninja also has bb pecent histogram with color for ovebought/oversold condition http://www.ninjatrader-support2.com/vb/local_resize.php?linkid=168&size=0

HPT on 7:36 AM said...

Thanks Cory,
I didn't see that link, but now that I've found it, I see that there are a lot of good free indicators out there, which are not already included in NinjaTrader at http://www.ninjatrader-support2.com/vb/local_links.php?catid=1&sort=N&pp=15

Dinosaur Trader on 2:00 PM said...

Hey, what'd I say?

-DT

HPT on 5:23 PM said...

Sry about that, forgot to add you to the trading blogs column when I deleted the daily reading column.
It's all good.

Dinosaur Trader on 11:04 AM said...

OMFG... how could you "forget" me?

How about this???

I hate you and your silly blog!

How's that feel?

-DT

HPT on 12:49 PM said...

Bean snorter.

Honestly, how is that even possible?

Who wants to be friends with a guy with beans up his nose?

You should be on Ripley's "believe it or not"....

:)

Dinosaur Trader on 6:08 AM said...

Look, I was puking... I had chili... it all makes sense if you understand the inner anatomy of the skull.

-DT

tapeworm on 2:50 PM said...

http://www.youtube.com/watch?v=IMjFN-m2VOM

HPT on 12:45 AM said...

I set a PR 2 months ago on pullups, I think it was 52. I've been slacken on the gym this last month because I've been feeling sick, but I'm starting up my routine again. Nice to hear from you tapeworm. I dont make blog posts like I use. I think I've lost 200 people from the daily reading list. I Dont really care. In the future I'll probably get back into the habit of making posts, but I've been busy with lots of stuff these last few months.

Jules on 1:03 AM said...

Hope you're feeling better now, HPT.
52 pull ups?? Goodness...

tapeworm on 5:08 PM said...

52 pullups?!? Damn!!!

HPT on 12:00 AM said...

I'll have to make a video next time to be cool like those guys on youtube!

:)

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