The Internal Bar Strength (IBS) indicator for MetaTrader4 is an oscillator that gauges the relative position of the closing price in relation to the low to high range for the exact period. The Internal Bar Strength (IBS) take a 0 value when the lowest price of the day is the closing price, and a value of 1 when the highest price of the day is the closing price.
The IBS indicator is usually affected by intraday over-reaction to market movement and news, which usually gets corrected the next day. The IBS gauges the tendency of a price series to average revert over daily outlook.
The values of the moving average internal bar strength is used to gauge the IBS indicator, which is computed by the formula IBS = (Close Price-Low Price) / (High Price – Low Price) * 100%.
The default period for use is 5 bars. Price is said to be overbought if the line of the IBS indicator crosses above the 60, while price is said to be oversold when the IBS indicator falls below the 40 level.
These levels are the signal level, but there are instances where the indicator could hit extreme levels of “100” and “0,” which are obviously represents “very overbought” and “very oversold” levels respectively.
MT4 Indicator Characteristics
Currency pairs: Any
Platform: Metatrader 4
Type: chart window indicator
Customization options: Variable (per), Colors, width & Style.
Time frames: 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours, 1-Day, 1-Week, 1-Month
Type: momentum oscillator