The multi-scale volatility indicator is a game-changer for traders looking to understand market fluctuations across various time frames. This tool condenses the volatility data from multiple periods, specifically the following: 3, 4, 5, 6, 8, 10, and 13.
How It Displays Volatility:
- Red Bold Line: This represents the summarized volatility.
- Red Line: Indicates volatility for lag 3.
- Orange Line: Shows volatility for lag 4.
- Gold Line: Denotes volatility for lag 5.
- Green Line: Represents volatility for lag 6.
- Turquoise Line: Indicates volatility for lag 8.
- Sky Blue Line: Shows volatility for lag 10.
- Blue Line: Represents volatility for lag 13.
Settings:
- Smoothing Period (default value = 14).
When you analyze this indicator, you'll notice a significant difference compared to the conventional lag 1 volatility measurements. It provides you with a comprehensive view of how market volatility behaves over different time frames, allowing for more informed trading decisions.
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