Trend and Volatility Indicator Combining Bollinger Bands with ADX

Summary

This indicator combines a 20-period average and standard-deviation bands with ADX readings calculated over multiple lookback periods. It labels a bullish condition when price is above the average and upper one-standard-deviation band while at least one of the ADX readings is rising. A bearish condition applies when price is below the average and lower band with the same ADX condition. It plots inner and wider bands and colors candles to distinguish bullish, bearish, and other states.

The description recommends using the tool across multiple timeframes and presents it as a way to assess trend direction and strength while recognizing range-bound conditions. The supplied code is the implementation evidence, but the document gives no backtest, parameter comparison, or trading rules for entries, exits, and risk. Its ADX logic only checks whether any listed period is increasing, which is not itself a directional signal; direction comes from price relative to the average and band. Users should validate the calculations and behavior on their platform and markets.

Key ideas

• The indicator overlays a moving average with one- and two-standard-deviation bands.
• It checks rising ADX values across several lookback periods as a trend-strength condition.
• Price above the upper band signals a bullish state, while price below the lower band signals a bearish state.
• The code also colors candles and plots several derived band lines.
• The document offers no performance testing or complete trade-management rules.

Tags

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