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# My Custom Indicators ?

Some of you wanted to know what kind of indicators I used.

They are just bollinger-bands with a few extra deviations. They allow me to guesstimate implied volatility (theoretical volatility). The standard deviations represent a measure of volatility. But I don’t use them like that. I use standard deviations to see how far price can extend before a pullback to the dynamic mean- depicted as a white moving line. The dynamic mean is the 20-period-moving Average. I use the standard 20-period settings.

Standard deviation 3 of the outer bands should encapsulate the price 97% of the time. There is a 3% chance price will keep rallying this is called band-walking according to a Japanese FX trader called Japanese Forex Trader Kei on youtube.

The standard-deviations allows me see the range incase price is over-extended. This is usefull information because it allows me set a range for laddering in orders. I start laddering when price touches standard deviation 1 and when a few conditions are met.

How do I know price won’t blast through standard deviation 3-4 and continue upwards? The answer is multiple timeframe analysis. Read about shorting outer-deviations

How to use it? Copy the code below and paste it in pine-editor then add to chart.

``````study(shorttitle="BB_3deviations", title="IF_bollinger", overlay=true)
source = close
length = input(20, minval=1),

mult = input(2.0, minval=0.001, maxval=50)
mult1 = input(3.0, minval=0.001, maxval=50)
mult2 = input(4.0, minval=0.001, maxval=50)

basis = sma(source, length)

dev = mult * stdev(source, length)
dev1 = mult1 * stdev(source, length)
dev2= mult2 * stdev(source, length)

upper = basis + dev
lower = basis - dev

upper1 = basis + dev1
lower1 = basis - dev1

upper2 = basis + dev2
lower2 = basis - dev2

plot(basis, title='basis', color=red, linewidth=3, transp=0, trackprice=false)
p1 = plot(upper, title='upperband1', color=#39ff14, linewidth=1 )
p2 = plot(lower, title='lowerband2', color=#39ff14, linewidth=1 )
p3 = plot(upper1, title='upperband3', color=#39ff14, linewidth=1 )
p4 = plot(lower1, title='lowerband4', color=#39ff14, linewidth=1 )
p5 = plot(upper2, title='upperband5', color=#39ff14, linewidth=1 )
p6 = plot(lower2, title='lowerband6', color=#39ff14, linewidth=1 )

fill(p1, p2)
fill(p3, p4)
fill(p5, p6)``````