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ZigZag indicator

ZigZag indicator

definition
The ZigZag is not an indicator in itself, it is more of a filter. The ZigZag filters out unimportant noise in the price chart. The ZigZag in itself has no predictive value and looks back only. The ZigZag is however of added value regarding predictive signals in combination with other tools such as Elliot Wave (wave counts) and Fibonacci retracements (length counter movement after a wave).

signals
As previously described, the ZigZag does not in itself signals. A little further you will still find an effect of the combination ZigZag Fibonacci Retracements.
ZigZag indicator
calculation ZigZag
With the ZigZag filter noise in the price chart. If you set it to 10% then the ZigZag only times when the opposite movement to the current motion is greater than 10%. Is the opposite movement of less than 10% will return not to the ZigZag and continues on his way. See the illustration below.

ZigZag icm Fibonacci Retracements
Fibonacci is good to apply on the waves of the ZigZag. On a large price movement is always followed by a reaction movement and very often ends up on one of the famous Fibonacci Retracements. In the example below, you indicate what Fibonacci Retracement level recovery movements following the sharp declines stop to stop.
ZigZag indicator

Negative Volume Index

Negative Volume Index
NSA - Negative Volume Index

Category: Volume indicator

Negative Volume Index focuses on days when volume decreases compared to the previous day. The premise is that the smart group all-knowing investors' positions on days when volume decreases. The Negative Volume Index thus shows the activity of the professional investors.

The PPI (Positive Volume Index) gives just the activity of the non-professional investors.

signals
The NVI and PVI should especially be optically analyzed. The author has Fosback associated table developed over a period of 35 years of test results. The Negative Volume Index PPI & give signals by their position relative to the one year moving average (eg 52 weeks in one week graph) according to the following table:

Indicator Ind compared MA Bull Market Bear Market
NVI above 96% 4% MA
PVI above MA 79% 21%
Negative Volume Index under MA 47% 53%
PVI under MA 33% 67%


In the 1st part of the graph are the NVI and PVI is above both its 52 weeks average. The chance of a Bull Market is in the above table 96% for the Negative Volume Index and 79% for the PPI. The market is very bullish.

calculation of Negative Volume Index
The Negative Volume Index changes only by the following formula as the volume of the last period is less than the volume of the last period. When the last volume is higher than the last period of time than for the Negative Volume Index does not change.

NVI NVI = yesterday + (((closing price - price yesterday) / rate yesterday) * Negative Volume Index yesterday)




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Secret Money Flow Index Indicator

Secret Money Flow Index Indicator
MFI - Money Flow Index

Category: Volume momentum indicator

Definition
The Money Flow Index (MFI) is a momentum indicator. The MFI is in terms of signals similar to the calculation and RSI is the Money Flow Index, however, more specifically because of the fact that it also has volume-weighted. The Money Flow Index clearly shows whether money is flowing into or out of a stock and thus indirectly or powerful or just a current trend is weakening.

Money Flow Index Signals
The MFI index moves between 0 and 100 and is often used for overbought / oversold conditions, and volume divergences compared to the current trend.

Money Flow Index Overbought / oversold
If the MFI is above 80 then increases the share in an overbought situation. There is too much volume compared to the average upward. The risk of profit-taking is increasing rapidly, as the volume again by the same door to go outside the price drops. This situation also applies vice versa. A decrease in the MFI is below 20 share in the oversold zone correctly. The following illustration shows 2 peaks and 1 soil in the MFI directly coincide with 2 tops and 1 bottom in the price chart.

Divergences
Divergences often indicate that the trend will soon change. If the share eg reduced soil converts but the MFI higher bottoms turn this indicates that more volume is rising on positive days than negative volume on declining days. This indicates a weakening of the declining trend since the time soon comes to the larger volume upward will prevail on the falling volume.

MFI indicator (tops and bottoms) in ProRealTime
Figure 1: MFI indicator in the U.S. share of Wal-Mart (overbought-oversold)


Calculating MFI
The MFI is calculated over (n) periods, often this is standard 14 periods. The MFI is composed of a set of sub-formulas.

A) First, calculate the average rate for a period: (High + Low + Last Price) / 3
B) Money Flow = average rate of the period (from A) * Volume

C) Calculate for each period from (n) steps A and B:
Add the result to the "Positive Money Flow (PMF)" if the middle rate higher than the previous average rate or add the result to the 'Negative Money Flow (NMF)' as the average rate is lower than the previous fixing.

D) We can now calculate the Money Ratio: MR = PMF / NMF

E) The Money Flow Index = 100 - (100 / (1 + MR))
The fewer the number of selected periods (n) the more volatile the indicator.


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Linear Regression Channel Trading

Linear Regression Channel Trading
Linear Regression Channel Trading, In this articles I am going to share about the Linear Regression Channel system trading. Many traders often find at long term trading with Linear Regression Channels, same with the moving average indicator 200 day period.
A channel line that walks parallel to the linear regression line and is generally 1 to 2 standard deviations above the Linear regression channel line is Upper Channel line.
A channel line that fits all data levels of interest is Linear regression line.
Lower channel line , this lower channel line walks parallel to the linear regression line & is generally 1 - 2 standard deviations under the linear regression channel line.

S&P chart tells prices in a steady bullish trend and maintaining in a one standard deviation linear regression channel trading. If the price break outside of the linear regression channels , either trend could be ending and buy or sell opportunity are occur.

Sell signal in Linear Regression channel trading, an opportunity for short triggers when prices break above the upper Linear Regression channel line.

Buy signal in Linear Regression channel trading, when price declines under linear regression channel line , a long signal is generally triggered.

Use other Forex technical indicators to confirm signs.

Trend Reversals

If market price closes outside of channel for long periods, this is determined as a first signal that the past market price trend may be breaking and reversal might be occur.

Linear Regression Channels are powerful Forex technical trading tools. In addition to determining trend and direction of market trend.

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