Purple Bands Indicator - Key to identify oversold and overbought
Unlike traditional oscillators, the Purple Bands indicator is designed to more accurately and timely identify oversold and overbought conditions in the market. This indicator is a great tool for detecting oversold or overbought market conditions, with up to 80% accuracy.
What are the features of the Purple Strike Indicator?
The Purple Bands Indicator is unique in that it plots new price levels at exactly midnight every trading day, which then remain unchanged throughout the day. Therefore, unlike most other common indicators, the Purple Bands Indicator does not experience any changes in its values throughout the day.
The indicator plots zones of different colors that indicate areas where the market price is already overbought and is likely to start falling, or conversely, where the market price is undervalued and should start rising in the near future. As the colour gets darker, the probability of a trend reversal increases, although very often a reaction occurs in the lightest areas.
How does the Purple Strike Indicator work in practice?
Assuming you have successfully installed the indicator, you can start using it on all markets. However, the indicator is ideal for markets where large and long trends are not common - i.e. most currency pairs.
You can display the Purple Bands indicator on any intraday and swing timeframe. It is therefore very flexible and can adapt to your trading style and strategy.
In the chart below you can see the currency pair USDJPY on timeframe H1. The Purple Bands indicator shows in two cases (in red circles) that the price is in the lightest area, which indicates that the market is oversold in the first case (from the left) and should start to rise. In the second case, the market is overbought and a short-term decline is expected. However, remember that the indicator does not provide a 100% guarantee and it is always important to respect your trading strategy and money management.
Purple Bands indicator on USDJPY, H1 Timeframe
Purple Bands Indicator is a great tool for identifying potential trading opportunities. Combining it with our other unique tool, the Purple Strike Indicator, can lead to a more powerful and effective trading strategy. With these tools, your trading in the financial markets can be even more successful.
How the Purple Bands Indicator works - watch the video