Keltner Channel (Top) [KeltnerTop]

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The Keltner Channel (Top) function calculates the upper band of the Keltner Channel, which uses twice the average true range of the data series for the width of an envelope around the EMA. Parameters ------------------ Close         The closing price of the security for each given day. High          The high price of the security for each given day. Low           The low price of the security for each given day. Indicator Value ------------------------ Keltner Channels are a pair of values placed as an "envelope" around a data field. The values are calculated by taking the exponential moving average of the data for the given period and adding or subtracting twice the average true range from the moving average. Since the Average True Range uses a moving average, the value at the beginning of a data series is not defined for 10 bars. Usage ----------- Keltner Channels are useful for determining whether current values of a data field are behaving normally or breaking out in a new direction. For example, when the closing price of a security increases above its upper Keltner Channel, it will typically increase in that direction. Keltner Channels are similar to Bollinger Bands and share many of their characteristics, but represent volatility using high and low, rather than the standard deviation of the one field. Source ------------ Keltner Channels were developed by Chester Keltner and introduced in his book "How to Make Money in Commodities". Some revisions were later introduced by Linda Raschke. This indicator is based on an entry in the appendix of the book "Technical Analysis of the Financial Markets" by John J. Murphy.