Building an ATR-Based Rainbow Channel Around a High Moving Average

Summary

The document briefly describes a technical indicator for MetaTrader 4 built from six lines around a high-price moving average. The outer line is offset by twice the ATR multiplied by a configurable multiplier; inner lines use progressively smaller ATR-based offsets. This creates a channel-like set of bands whose width responds to measured volatility.

The excerpt says the indicator has two input parameters, but does not identify both inputs or specify the moving-average period, calculation details, signal rules, or intended market. It provides no chart, backtest, performance evidence, or guidance for interpreting price interactions with the bands. The description is enough to convey the basic construction, but not enough to reproduce the indicator exactly or assess it as a trading method.

Key ideas

• The indicator draws six lines using a high-price moving average and ATR-based offsets.
• The outermost band is described as two ATR multiples above the moving average.
• Progressively smaller ATR offsets define the inner lines.
• The excerpt does not provide signal rules or enough detail for exact replication.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.