Acceleration bands
Bands drawn around a moving average and widened using the day's high-low range, meant to highlight potential breakout zones as volatility expands.
What the numbers mean
The lookback sets both the central moving average and the window of high-low ranges used to widen the bands. The band width comes from the average range as a fraction of price, so the envelope expands where the daily swing has been getting larger.
- 20 — the lookback for both the central average and the range calculation
- 80 — a longer setting used for position trading
- Width comes from average range as a fraction of price, so it scales with the security
How it is used
Read as a breakout frame: two consecutive closes outside a band are the conventional signal that a move has enough force behind it to continue, rather than a stretch to be faded.
- Two consecutive closes outside a band → the conventional breakout signal
- A single close outside → usually treated as noise
- Bands widening → the average daily swing is growing
How it relates to everything else
Acceleration bands sit between fixed envelopes and ATR channels: the width comes from range like Keltner, but expressed as a proportion of price like a percentage envelope. Formulas differ between platforms, so readings will not always match.
- Closest in spirit to Keltner channels, which use ATR directly
- Two-closes-outside rule makes it stricter than a Bollinger band touch
- Check the platform's formula before comparing charts
What to watch for
It is a niche indicator with no single agreed formula between platforms, so readings will not always match from one charting package to another.