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Volatility

Keltner Channels

KC

Centers an EMA with upper and lower bands set at a multiple of ATR away. Smoother than Bollinger Bands because ATR changes more gradually than standard deviation. Traders use band breaks to confirm trend strength.

Tips

When Bollinger Bands squeeze inside Keltner Channels, it signals very low volatility and a high probability of an explosive breakout
Closes outside the Keltner band that hold on the next bar are stronger trend signals than mere wick penetrations

Parameters

EMA Period
2 - 50
ATR Period
2 - 50
Multiplier
1 - 5