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Percent B Indicator
%B quantifies a security's price relative to the upper and lower Bollinger Band. There are six basic relationship levels:
- %B equals one when the price is at the upper band.
- %B equals zero when the price is at the lower band.
- %B is greater than one when the price is above the upper band.
- %B is less than zero when the price is below the lower band.
- %B is greater than .50 when the price is above the middle band (20-day SMA).
- %B is less than .50 when the price is below the middle band (20-day SMA).
The default setting for %B is based on the default setting for Bollinger Bands (20,2). The bands are set two standard deviations above and below the 20-day simple moving average, which is also the middle band. The security price used is the closing price or the last trade.
To apply a Percent B Channel Indicator
- From within a chart, from the Edit menu select Studies.
- Choose Percent Band click Add to add the study to the Applied Studies group.
- Complete parameters as necessary.
Once the study is defined, you can elect to uncheck/check to remove and add the study to your chart.