The %BB forex indicator for MetaTrader4 is used to measure the price of an asset relative to the upper and lower Bollinger Band. The %BB has six primary relationship lines:
%BB equals 100 when price is at the upper band
%BB equals 0 when price is at the lower band
%BB is above 100 when price is above the upper band
%BB is below 0 when price is below the lower band
%BB is above 50 when price is above the middle band (20-day SMA)
%BB is below 50 when price is below the middle band (20-day SMA)
The Bollinger Band that was added to the chart was done to further aid in our illustrations based on the %BB indicator. The %BB indicator can be used to spot overbought and oversold conditions. It is important to look for opportunities in favor of bigger trends i.e. pullbacks within a bigger downtrend or uptrend.
It is best to go in search of short-term oversold conditions when the medium trend is bullish and short-term conditions when the medium-term is bearish.
The relationship between price and Bollinger Bands is quantified by the %BB. Values above 100 indicates that price is near the upper band, while %BB values below 0 indicates that price is near the lower ban.
When price drives towards the upper band, it denotes strength, but can also be interpreted a overbought. Dips towards the lower band denotes weakness, but in some cases can be tagged oversold. It is best to the %BB in conjunction with other technical studies.
MT4 Indicator Characteristics
Currency pairs: Any
Platform: Metatrader 4
Type: chart window indicator
Customization options: Variable (Bands_period, Bands_deviation), Colors, width & Style.
Time frames: 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours, 1-Day, 1-Week, 1-Month
Type: momentum oscillator