Upper hot color bands are based on Buying Pressure
Lower cold color bands are based on Selling Pressure
This makes the levels of bands be more relevant to the candle metrics. The regular ATR bands the upper and lower levels expand equally with ATR change. Whereas FREMA levels expand and shrink by the change of 2 factors: Buying and Selling Pressure. In a nutshell, it's the bullish and bearish parts of the candle measured with separate variables that govern the upper and lower bands independently. Therefore we can agree that out of all volatility bands, the FREMA is more native to the nature of ongoing price fluctuations.
The volatility levels can be implemented in strategy for trading the range of probabilistic prices. Combination with trend-following indicators can determine the condition of multiple buying orders at different cold color levels. To be able to catch the very bottoms, the condition of bullish entry series should be set with 0 open trades unless the price or any other price-following substituting components are equal or lower than one of the lowest bands. This filters the entries from risks of buying as soon as price falls below middle deviation line.
For filtering with "Buying and Selling Pressure" use open source code below:
บันทึกช่วยจำ
For evaluating strategy I always go back in times to see how it performed around COVID 19 drop as the period of most uncertainty and panic. For example, SP500 TRUST: