Recognizing trend
Everybody has the same information: basically 5 numbers-Open, High, Low, Close, and volume so there is almost always somebody who has worked on the problem before. The best first place to check is ARTICLES on this website and search momentum, rate of change, etc and you get lots of good information. The goal is not to predict the future, which is impossible, but to understand what is happening in the market and consider the probabilities of price going up and down.
I trade trends all the time and worked with various "heat mapping" (which is what you described with the four moving averages.) But what I like and use most is Renko bars which are built specifically to detect price movement which it does without indicators by just measuring the change in price. There are ARTICLES on this too (Renko). A lot of use Renko so you can find our profile pages with lots of discussion about the daily trends.
Other than this first best sources, check out YouTube.com which has lots of FX videos.... lots of crap too by the way. TIP: Don't send anybody any money.
CodeShare has a lot of momentum indicators that you can get for free. MARKET has lots of indicators and EAs built around momentum that can give you a lot of ideas. Don't spend any money at first and try out all the free stuff on a DEMO account.
Ask a lot of questions. Consider a lot of ideas. Good luck.
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Hello guys.
I'm still thinking how to recognize trend with EAs.
You know manually, when looking at the graph you can say "ok this is uptrend". Its going nicely upward...
My problem is to how to automatically recognize trend. What do I now is doing array of 4 EMA values and then im trying to copare them. If -4 is bigger than -3, and -3 is bigger than -2 and -2 is bigger than -1 im in uptrend. Unfortunatelly I can not tell how strong this trend is, because i dont know how to calculate this. Simple difference between -4 a -1 will give me "a number" but how to recognize how strong trend this is ... What I have been thinking about is trying to compute derivation. But it was hard to grasp it.
Could you pleas tell me how You are recognizing trend in your EAs? Thank you and have anice day.