BollingerDown is a function in ProBuilder language that calculates the lower band of the Bollinger Bands indicator. Bollinger Bands are a type of statistical chart characterizing the prices and volatility over time of a financial instrument or commodity, using a formulaic method involving a moving average and standard deviations.

Syntax:

BollingerDown[N](price)

This function takes two parameters:

• N: The number of periods to use in the moving average calculation.
• price: The price series to be used (typically close price).

Example Usage:

// Example to detect when the last bar's open is above and close is below the lower Bollinger Band
bollD = BollingerDown[20](close)
VAR = 0
if(Open[1] > bollD[1] AND Close[1] < bollD[1]) THEN
    VAR = 1
ENDIF
RETURN VAR // Returns 1 if the condition is met, indicating a "Lower Piercing Signal"

Explanation:

The BollingerDown function is used to identify the lower boundary of the Bollinger Bands. The bands themselves are calculated based on a moving average of the price, plus and minus a certain number of standard deviations of the same price over the specified period. The lower band is typically viewed as a potential support level in technical analysis of securities trading.

The example provided demonstrates how to use the BollingerDown function to check if the previous bar's opening price was above the lower Bollinger Band and the closing price was below it. This scenario is often looked for by traders as a potential signal of increased volatility or a possible reversal if it occurs in a downtrend.

Additional Information:

The Bollinger Bands assume price data to follow a normal distribution (bell curve) to some extent, which is not always the case in real-world markets. However, they are widely used in financial markets to gauge volatility and identify potential overbought or oversold conditions.