The idea is that the sharper trend movement is, the greater is the momentum, and the closer is the value of the momentum to the sum of the ranges of bars. So the indicator is the ratio of the momentum to the sum of ranges:
Change To Range Ratio = (close[bar] - close[bar-period]) / Sum(high - low)
This indicator is very similar to Range Ratio, but it uses a difference between the closing prices, which provides the following benefits:
The indicator is designed for short-term trading on high timeframes (H4 and higher), and works well with 3-5 bar period. Values greater than 0.5 indicate an overbought market, and therefore you should close long positions and shouldn't open new ones. Values less than -0.5 warn against opening short positions, or, if there are open new ones, you should close them.
Translated from Russian by MetaQuotes Software Corp.
Original code: https://www.mql5.com/ru/code/1759
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