VWAP SD Bands

[tedcarapook]

Hey Guys,

I'm a big user of the VWAP line and have been trying to create some standard deviation bands to complement my current trading chart. Have been playing around with stored history list values but not sure if it is possible without a square root function in the bet angel interface? Anyone have some suggestions how to go about this? Trying to avoid going down an excel pathway.

Cheers

[PerthO]

Hi Tedcarapook

This can be done using the Babylonian method.

Say we have a number, 6.
The actual square root is 2.449489743.

Guess a number, doesn't matter what, but the closer to the correct answer the less iterations will be needed (you'll see why).
I'm going to guess 3.

The formula is (Guess + number / guess) / 2

So in this case it becomes (3 + 6 / 3) / 2 => 2.5
This becomes your new guess.
So :
(2.5 + 6/2.5) / 2 => 2.45
(2.45 + 6/2.45) / 2 => 2.449489796
(2.449489796 + 6 / 2.449489796) / 2 => 2.449489743

So you have done this in 4 iterations.
You could do it with an initial number much higher, but it would take more iterations.
You could have multiple steps in a rule doing this (I have done it).
You are not going to know how many iterations you need to do every number, but with say 6 you should be guaranteed to be pretty accurate.

Graham

[tedcarapook]

Thanks Graham

Huge help, I wish for you nothing but good trading karma