Price Action Strength Indicator
Price Action Strength indicator uses available market data in its purest form (price action) and on that basis determine the effect of market movements. Reading price action and measuring its strength are the subjective factors on the acquisition of this skill will take years. The purpose of this indicator is to make reading price action force as objective as possible.
It is much more advanced indicator, compared to standard oscillators, because in addition to the price movement and its direction Price Action Strength indicator analyzes the characteristics of movement. This allows you to see the market through the eyes of an experienced trader on the price action.
The new version of Price Action Strength uses the same values as version 1.0, but version 2.0 is able to determine market sentiment. There are 2 possible mood:
- Humor prediction / reversal, which is calculated based on the last peaks / troughs price compared with the value of Price Action Strength;
- Mood continuation / pulse, the pulse is calculated on the basis of values and Price Action Strength.
The new version is a certain mood is used to generate the arrows on the chart, which indicate the likely direction of future market movements based solely on the analysis of price action.
In the new version, there are 3 kinds of arrows / buffers (one for each direction) in addition to the two buffers that were present in 1.0:
- strength buffer ‘Strength’ It calculates the relative strength of price action compared with a specified number of past bars (Period). The information is visualized using a line in a separate window. The upward movement of the line indicates the bullish effect of the price action, the downward movement indicates a bearish effect of the price action. The higher the line, the more bullish price action is the strength, the lower line, the more bearish is a force;
- overlapping buffer ‘Overlap’ It calculates the relative overlap of the current bar compared with the specified number of previous candle (Period). The information is visualized as a histogram. The higher the bar graph, the stronger the strength of price action, taking into account overlapping bars. In other words, the above histogram, the minimal overlap exists between the bars, which means that the price of a particular direction, it does not oscillate, which indicates strong motion;
- reversal buffer ‘Reversal’ denoted fine up / down arrow. Reversal arrow indicates that the likely price reversal. Signals a reversal produce the most false signals, but if they are true, they predict the strongest movement. When trading these signals it is recommended to use the risk reward ratio is not less than 2;
- continue buffer ‘Continuation’ denoted by an oblique arrow. Continue arrows indicate that the market is gaining momentum in the corresponding direction. These signals often occur during the current trend. They are intended for use as an auxiliary indication that the market is likely to continue to move in this direction. continuation signals provide the most accurate predictions, but following them market movements are often small. It is recommended to use these signals for building trades with the trend or scalping;
- confirmation buffer ‘Confirmation’ denoted by the thick arrow up / down. confirmation Arrows displayed when one candle at a time there are signals of a reversal and continuation. This indicates a very probable movement.
Note! All arrows appear at the opening of the candles, on which they are located, and not redrawn!
indicator arrows can be used as an independent trading system, meaning you can make deals with the appearance of the arrows. You can also use the arrows to determine the sentiment in the market, as price action analysis gives a fairly accurate prediction of the likely future direction of the market.
Price Action Strength 2.0 works on all timeframes and symbols, but it is recommended to use higher timeframes (H4 and above), since the principles of price action analysis work better on higher timeframes.
Input parameters
- ‘Period‘- the number of bars for historical comparisons of current values.
- ‘0-line threshold‘- threshold for buffer’ Strength ‘, which is used for determining the mood acknowledgment / pulse.
- ‘Momentum sentiment candles span‘- the number of spark detection mood acknowledgment / pulse. If within this amount of candles buffer ‘Strength’ commit a certain percentage of positive / negative changes, it will be assumed that the market there is impetus in this direction.
- ‘Momentum sentiment%‘- percentage of positive / negative changes of buffer’ Strength ‘for a specified number of candles from the previous parameter required for confirmation pulse in this direction.
- ‘Fractal size‘- fractal dimension in one direction. Used to determine the mood of forecasting / reversal.
- ‘ZigZag confirmation bars‘- the number of closures needed to comply with ZigZag level to cope with the redraw. Principles of ZigZag indicator used to determine the mood of forecasting / reversal.
- ‘Depth‘- for the depth of ZigZag.
- ‘Deviation‘- deviation ZigZag indicator.
- ‘Backstep‘- the number of bars for the history of ZigZag.
- ‘Show once‘- if true, the arrow must alternate. For example, after the confirmation of bovine arrow should appear confirming the bearish arrow that could appear next bull confirming the shooter. When the indicator shows all false signals by the mood as they are discovered.
- ‘Show predicting sentiment change‘- if true the graph shows an arrow predicting mood.
- ‘Show continuation sentiment change‘- if true the graph shows an arrow to continue mood.
- ‘Show confirming sentiment change‘- if true the graph shows arrows confirmation mood.
- ‘Alerts‘- in the true meaning of the appearance of any of the arrows, the indicator will file screen notifications in MetaTrader 4, indicating the name of the character on which the event occurred.
- ‘Push notifications‘- in the true meaning of the appearance of any of the arrows, the indicator will send push-notifications to the mobile terminal indicating the name of the character on which the event occurred.
- ‘Emails‘- in the true meaning of the appearance of any of the arrows, the indicator will send a message by e-mail indicating the name of the character on which the event occurred.
Video
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