could you convert this to MT4 please.
You are missing trading opportunities:
- Free trading apps
- Over 8,000 signals for copying
- Economic news for exploring financial markets
Registration
Log in
You agree to website policy and terms of use
If you do not have an account, please register
Fractal dimension index (Sevcik/Matulich):
According to the description of Fractal Dimension Index:
Mandelbrot describes the Fractal Dimension Index (FDI) as a way to measure "how convoluted and irregular" something is. The FDI can be used as a stock market indicator.
We can look at prices in a market as "trending" or "ranging". During a strong rally, prices trend sharply, sometimes approaching a one-dimensional straight line. And if we believe that prices should move in a more jagged fractal pattern, we would assume that the almost-straight movement will end at a point which we might be able to predict with a degree of accuracy sufficient to make a good trade.
After trending, prices often trade in a range for a while before embarking upon the next trend. Imagine prices trading in a rectangular pattern, zigzagging back-and-forth over the same points in a two-dimensional planar pattern. A plane isn't a fractal any more than is a straight line, so we might expect prices to break out of the range and get back to acting like a fractal.
And so, the FDI is a method which assigns a number to the line on your chart. The number will be between 1.0 and 2.0. The closer prices move in a one-dimensional straight line, the closer the FDI moves to 1.0. The more closely prices resemble a two-dimensional plane, the closer the FDI moves to 2.0.
This version is made exactly as described by the original inventor of FDI (Carlos Sevcik) with one correction: the formula that Sevcik published is inverted. The error was corrected by Alex Matulich and this version is using the correct calculation.
Author: Mladen Rakic