Standard deviation is a statistical term that measures the amount of variability or dispersion around an average. Standard deviation is also a measure of volatility. Generally speaking, dispersion is the difference between the actual value and the average value. The larger this dispersion or variability is, the higher the Standard deviation. The smaller this dispersion or variability is, the lower the Standard deviation. Chartists can use the Standard deviation to measure expected risk and determine the significance of certain price movements.


The Standard deviation is a statistical measure of volatility. These values provide chartists with an estimate for expected price movements. Price moves greater than the Standard deviation show above average strength or weakness. The Standard deviation is also used with other indicators, such as Bollinger Bands. These bands are set 2 standard deviations above and below a moving average. Moves that exceed the bands are deemed significant enough to warrant attention. As with all indicators, the Standard deviation should be used in conjunction with other analysis tools, such as momentum oscillators or chart patterns.

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Settings in the chart

Settings in Strategies

Standard Deviation can be used both separately and together with other indicators in the Strategy Builder.