Donchian bands indicator forex

Breakout outside Acceleration bands suggest a beginning of a strong rally or a sell-off. Closing inside the bands afterward signals about the end of a rally or a sell-off. Acceleration Bands principal use is in donchian bands indicator forex the acceleration in currency pair price and benefit as long as this acceleration preserves.

Acceleration bands are set as an envelope around a 20 period simple moving average on equal distance from it. When Acceleration Bands are used for smaller time frames, upper and lower bands are treated as levels of possible support and resistance. 2 consecutive closes outside Acceleration Bands suggest an entry point in the direction of the breakout. Then position is kept till the first close back inside the Bands.