"Microwave Oven" Indicator
Great idea! I'll try the same thing. The idea sounds quite reasonable. Possibly it could be used as a filter for a trend-following advisor. Go on!
Nah, it will only show you that the last x period WAS ranging, So no good filter for trend following. Maybe a good indicator to activate a range breakout EA ;)
//z
I have a trend EA that just fails badly when it ranges, so I wanted an indicator that would tell me if it's ranging heavily or not.... No?
Hmmmm... OK..
We can never know before trying. I will write some code and tell you the results.
Additionally, it could be interesting to think of averages that have different directions. For example, the 5-days average is going up and the 6-days average is going down. The indicator could sum up all different directions over a bunch of different averages and time intervals. What do you think?
Zzuegg, how would you combine bollingerbands to detect ranging markets?
X7P5, do remember to come back here and upload your results, that will be interesting to see! The "Microwave Oven Indicator" MWO.. ?
I will.
Back to the idea to use it as a filter: If a trend-following advisor is based on indicators that use, for example, the last 10 days for calculation, then, your idea could be based on shorter averages, e.g. 1-10 days. This would mean that the indicator is faster than the expert itself and could possibly used as a filter. The filter could warn the advisor before difficult times arise...
Hi,
In your case, you could also you a good volume indicator to see how many pips up and down so you get clear about the price range for a specific period of time,
Good luck,
SF
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I had an indicator I'm thinking of coding, but I want to know your thoughts on it first.
The idea is to use a 3EMA and 4EMA (or similar) and count the number of times they cross each other for a given timeframe.
This should tell if the market is Ranging or not, because if they keep intertwining around eachother, the crossovers will be high, if we are fully trending, the crossover will be almost zero.
I call it a "Microwave Oven" because the higher frequency microwaves produce more energy, similar in my mind to this indicator.
What do you think?