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STDDEV

Type: stddev • Category: indicators

Description​

Standard Deviation

Parameters​

NameTypeDescriptionRequiredDefault
dataExpstringprices datano
realstringData column to apply the calculation to (e.g., closing price)no
timeperiodnumberNumber of periods to use for STDDEV calculationno5
nbdevnumberNumber of standard deviationsno1

Help​

STDDEV

Standard Deviation​

The Standard Deviation (STDDEV) worker is an indicator used in financial analysis to measure the volatility of a security's price movements over a given period. It calculates the standard deviation of a specified data column (e.g., closing price) over a defined number of periods.

Description​

The STDDEV worker calculates the standard deviation of a specified data column, typically the closing price, over a defined number of periods. This indicator is used to gauge the volatility of a security's price movements. A higher standard deviation indicates greater volatility, while a lower standard deviation indicates lower volatility.

What does this worker do?​

The STDDEV worker takes the following parameters:

  • dataExp: prices data
  • real: Data column to apply the calculation to (e.g., closing price)
  • timeperiod: Number of periods to use for STDDEV calculation
  • nbdev: Number of standard deviations

It then calculates the standard deviation of the specified data column over the defined number of periods and returns the result.

How to interpret the results​

The STDDEV indicator can be used to:

  • Identify volatile periods: A high standard deviation indicates that the security's price is experiencing large fluctuations, indicating high volatility.
  • Identify stable periods: A low standard deviation indicates that the security's price is stable, with minimal fluctuations.
  • Set trading strategies: Traders can use the STDDEV indicator to set stop-loss levels or adjust position sizes based on the volatility of the security.

Additional Knowledge​

The Standard Deviation indicator is commonly used in technical analysis and is a key component of many trading strategies. It can be used in conjunction with other indicators, such as moving averages, to provide a more comprehensive view of market trends.

Usage Example​

To use the STDDEV worker, simply provide the required parameters:

STDDEV(dataExp=prices, real='close', timeperiod=20, nbdev=2)

This example calculates the standard deviation of the closing price over 20 periods, using 2 standard deviations.

Visualizing the STDDEV Indicator​

For a visual representation of how to use the STDDEV indicator, refer to the following images:

Full GIF Example Full GIF Example

Short GIF Example Short GIF Example