CompassFX
MetaTrader 4.0 Indicators
In technical analysis, indicators are mathematical calculations based on prices and other variables of the market. They are used to measure current conditions as well as forecast potential price movement and market direction.
MetaTrader 4.0 has a vast number of technical indicators installed in the software for immediate use. Here is a list of some of them:
Accelerator/Decelerator Oscillator — AC
Acceleration/Deceleration is an oscillating indicator used to measures
acceleration and deceleration of the current momentum. This
indicator will change direction before any changes in the
overall momentum. In turn, the AC will change its direction
before the price. If you realize that
Acceleration/Deceleration is a signal of an earlier warning,
it gives you evident advantages.
Accumulation/Distribution — A/D
When the Accumulation/Distribution indicator grows, it means
accumulation (buying) of a particular security, as the
overwhelming share of the sales volume is related to an
upward trend of prices. When the indicator drops, it means
distribution (selling) of the security, as most of sales
take place during the downward price movement. It is used to
measure the amount of buying and selling pressure by
weighting it with the relative location of price.
Alligator
Alligator Technical Indicator is a combination of Moving
Averages that use fractal geometry and nonlinear dynamics.
The blue line represents the Alligator’s Jaw. It is based on
a 13-period Smoothed Moving Average, moved 8 bars into the
future. The red line represents the Alligator’s Teeth. It is
based on an 8-period Smoothed Moving Average, moved 5 bars
into the future. The green line represents the Alligator’s
Lips. It is based 5-period Smoothed Moving Average, moved 3
bars into the future. Lips, Teeth and Jaw of the Alligator
show the interaction of different time periods. As the 3
lines move, clear trends develop. The Alligator indicator
indicates when to follow the trend and when to refrain from
entering the market over certain periods.
Average Directional Movement Index — ADX
A trend indicator used to determine the strength of a
prevailing trend.
Average True Range — ATR
This volatility indicator dynamically measures the typical
range between price high/low/close over a set period.
Awesome Oscillator — AO
This blended momentum and trend indicator is a 34-period
simple moving average subtracted from a 5-period simple
moving average and plotted through the middle points of the
bars. It shows direction of the market’s momentum at the
present moment.
Bollinger Bands — BB
A volatility indicator used to visually judge the
relationship between price and volatility changes. When the
markets become more volatile, the bands widen and they
contract during less volatile periods.
Commodity Channel Index — CCI
An oscillating indicator used to measure the deviation of
the commodity price from its average statistical price. Good
for catching tops and bottoms.
DeMarker — DeM
An indicator used to compare the most recent price action to
the previous period's price in an attempt to measure market
demand. It is generally used to identify price exhaustion
and can also be used to identify market tops and bottoms.
Elder-rays – Bulls & Bears
Blended trend following and oscillating indicators used to
reflect the current buying pressure versus the current
selling pressure.
Envelopes
This volatility indicator is formed with two moving
averages, one shifted higher above the other creating a band
which defines the upper and the lower boundaries of the
price range. The trading assumption is to sell when price
reaches the upper boundary of the band and to buy when price
reaches the lower boundary.
Force Index — FRC
This index measures the buying pressure at each price
increase, and the sell pressure at each price decrease. The
force of each market movement is characterized by its
direction, scale and volume. If the closing price of the
current bar is higher than the preceding bar, the force is
positive. If the current closing price if lower than the
preceding one, the force is negative.
Fractals
The Fractal indicator is used to indicate tops and bottoms
of the market based solely on the succession of price
action. A buy fractal is a series of at least 5 successive
bars, with the highest HIGH in the middle, and two lower
HIGHs on both sides. The reversing set is a series of at
least 5 successive bars, with the lowest LOW in the middle,
and two higher LOWs on both sides, which correlates to the
sell fractal. The fractals have High and Low values and are
indicated with the up and down arrows.
Ichimoku Kinko Hyo
Used to indicate market trend, this indicator is predefined
to characterize the market trend with Support and Resistance
Levels and to generate buying and selling signals. If the
Tenkan-sen line increases or decreases, the trend exists.
When it goes horizontally, it means that the market is in a
range or channel. This indicator works best on daily and
weekly charts.
Market Facilitation Index — BW MFI
This indicator shows the change of price for one tick which
equates to a market increase or decrease. Multiple ticks are
used in conjunction to determine market conditions.
Momentum
A simple indicator which compares later prices to earlier
prices to gauge strength and momentum.
Money Flow Index — MFI
Similar to OBV, but enhanced by the addition of momentum
characteristics based on relative location of price. Can be
used as both a primary and confirming indicator.
Moving Average — MA
Moving averages are one of the oldest and most popular
technical analysis tools. A moving average is the average
price over a given period. As the price changes, its moving
average either increases or decreases indicating market
direction. When the instrument price rises above its moving
average, a buy signal appears. If the price falls below its
moving average, there is a sell signal. The advantage
of trading a moving average is it typically places a trader
on the "right" side of the market because prices do not rise
much without the price rising above its average price.
The disadvantage of using a moving averages is it
lags which can cause a trader to buy or sell late. MetaTrader 4.0 provides four moving averages: Simple (SMA), Exponential (EMA), Smoothed (SMMA), and Linear Weighted (LWMA).
Moving Average Convergence/Divergence — MACD
A momentum and strength indicator that shows changes in the
relative movements of shorter and longer moving averages.
Good for identifying changes in momentum.
Moving Average of Oscillator — OsMA
Moving Average of Oscillator is the difference between the
oscillator and oscillator smoothing. In this case, Moving
Average Convergence/Divergence base-line is used as the
oscillator, and the signal line is used as the smoothing.
On Balance Volume — OBV
This volume indicator adds and subtracts volume to a running
total, depending on whether price moves up or down. A good
confirming indicator.
Parabolic SAR
A technical analysis strategy that uses a trailing stop and
reverse method called "SAR," or Stop-And-Reverse, to
determine good exit and entry points.
Relative Strength Index — RSI
This momentum indicator used to measure price relative to
past prices. The indicator is front-weighted for
sensitivity, but filters out noise well.
Relative Vigor Index — RVI
A responsive oscillator in which movement is normalized to
the trading range of each bar. The RVI is based on price
movement. Prices tend to close higher than they open in up
markets and close lower than they open in down markets. The
vigor, or energy, of the price movement is thus established
by where the prices end up at the close. To normalize the
index to the daily trading range, divide the change of price
by the maximum range of prices for the day.
Stochastic Oscillator
A highly sensitive indicator used to catch tops and bottoms
early.
Williams’ Percent Range — %R
This oscillator measures the relative location of closing
price in relation to the high-low range over a set time
period. It is used to determine market entry and exit
points.
Trading Platforms
MetaTrader 4.0
