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Indicators: Vortex Indicator

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MetaQuotes Software Corp.
Moderator
186083
MetaQuotes Software Corp.  

Vortex Indicator:

This indicator appears in the January 2010 issue of Technical Analysis of Stocks & Commodities.

Author: Neil

Brian Dee - Random Trader
1760
Brian Dee - Random Trader  

Scratchman
A quality indicator, thanks for sharing :)
Seems most useful for detecting potential reversal points,
so I would add levels to this indi depending on pair & timeframe to show possible direction changes
-BB-

MQL4 Comments
16319
MQL4 Comments  

Thanks for the Indicator :) Generous!!

Neil
52
Neil  
BarrowBoy:

Scratchman
A quality indicator, thanks for sharing :)
Seems most useful for detecting potential reversal points,
so I would add levels to this indi depending on pair & timeframe to show possible direction changes
-BB-


You are correct in your impression. The authors liken this indicator to Welles Wilder's DMI and it does seem to work in a similar fashion. They suggest using it as a reversal system but with an entry filter: entering on a breakout of the high of the bar creating a crossover of the VI+ above the VI-, or a breakout of the low of the bar creating the crossover of the VI- above the VI+.

The January issue of TASC just hit my mailbox only a few days ago, so I've only had time to read the article, then code the indicator. Obviously there hasn't been time to observe its behavior in the market, but I wanted to get it out there so the MQL community could start playing around with it. Perhaps someone will devise a scheme for adding the levels you suggest.

Neil
52
Neil  
xebec:

Thanks for the Indicator :) Generous!!

You're welcome!

vaclav01
35
vaclav01  

What is difference between this indicator and i-Trend? Isn´t it the same?

Neil
52
Neil  
vaclav:

What is difference between this indicator and i-Trend? Isn´t it the same?

I don't know - what is the i-Trend? Please understand, all I did was take the information from the TASC article and code the indicator in MQL4. Whether the Vortex Indicator resembles the i-Trend or any other indicator, other than the DMI (as stated by the authors of the article), I cannot say.

FXIA
75
FXIA  

To me it looks exactly the same as the DMI, iTrend and other clones. I doubt they are coded similarly using the same calculations but the results seem very close. This is the problem we're faced with when comparing indicators. So many are so much alike. For me the most reliable things to use are tools such as Gann, Fibonacci and support and resistance. That is not to say I think this indicator is of no use. It obviously is for some traders or they would not say it was good at showing potential reversals?


Question: When using it as a reversal indicator when do you then enter? Or is this another way of saying it has false signals and we're not responsible for that. Perhaps it is better described as a volatility indicator, or to show the trend once price has already confirmed this several bars ago.


I haven't tested this indicator as of yet but if I find it is out of the ordinary I will be sure to post back here.

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