Keltner Channel

/
//
//  Keltner Channels are similar to Bollinger bands in that they create an
//  envelope around prices in order to indicate oversold / overbought
//  conditions.
//
//  Bollinger Bands use standard deviation to measure volatility, while Keltner
//  channels use ATR (Average True Range).
//
//  Keltner Channels provide a smoother envelope, that may be easier to use.
//
//------------------------------------------------------------------------------

// Keltner Channels are constructed similar to Bollinger Bands
// around a moving average +/- volatility.
// The difference is in the measurement of volatility. 
// Bollinger uses standard deviation. MA(Close,20) +/- #STDs
// Keltner uses ATR (Average True Range). MA(Close,20) +/- #ATRs
// Keltner channels may be easier to use for detecting oversold / overbought conditions



Length = 20; Num_ATRs = 2;
// Length and Num_ATRs parameters should be personalized for your preferred settings.

Mov_Avg = MA(C,Length);
KUP   = Mov_Avg + Num_ATRs * ATR(Length);
KDOWN = Mov_Avg - Num_ATRs * ATR(Length);


Plot (KUP,"KUP",1,1);
Plot (KDown,"Kdown",1,1);
Plot (Mov_Avg,"Mov_Avg",6,1);