Abiroid Elder Ray Index MT5
- Indicators
-
Abir Pathak
I create MT4 and MT5 indicators. They are mainly arrows and scanner indicators and also some essential utilities.
I'm hoping they will make your trading easier and make you profitable.
You can join my Telegram channel to keep track of all products I post. - Version: 1.6
- Activations: 5
This is MT5 version only.
For MT4 visit:
https://www.mql5.com/en/market/product/156000/
Detailed blog post with screenshots:
https://www.mql5.com/en/blogs/post/765529
Features Overview
- Bull and Bear Power Visualization: Histograms or Lines or Bands
- Combined Bull/Bear Power (BBP) Mode: To see the net power balance
- Customize Colors: for instant pattern recognition
- Smoothing (Optional): reduces noise for cleaner signals
- Additional Filter Options:
- Price Divergence visualization to spot potential reversals
- Linear Regression smoothing for trend confirmation
- Colored DMI integration for trend strength validation
- Customizable Alerts: Get notified when Bull and Bear Power cross
What is Bull and Bear Power?
The Concept: X-Ray Vision for Markets
Imagine markets as a tug-of-war between two forces: buyers (bulls) and sellers (bears). The daily high price shows the maximum power buyers achieved, and the daily low shows the maximum power sellers achieved. But how do we know if these prices are actually strong? Dr. Elder solved this by comparing highs and lows against a 13-period Exponential Moving Average (EMA)—which represents the market's consensus of fair value. Here's the simple formula:
Bull Power = Daily High − 13-period EMA
Bear Power = Daily Low − 13-period EMA
Additional Indicators (Blue Line):
1. ADX Colored DMI Line
Purpose: Shows the direction of market momentum (bull vs bear trend strength)
What it shows: A blue line that goes positive when bulls are pushing up, negative when bears are pushing down. The line itself indicates momentum direction without requiring the main Bull/Bear Power lines.
2. Price Divergence/Convergence
Purpose: Shows how far the current price has moved away from its "fair value"
What it shows: Positive values = price above fair value (overbought), Negative values = price below fair value (oversold). More reactive and responsive to price changes.
3. Least Squares Price Divergence
Purpose: Same as #2 but smoothed using a trend line to filter out noise
What it shows: Same concept as #2, but the linear regression removes short-term noise and shows the underlying trend more clearly. Less reactive but cleaner.
Key Differences:
DMI: Shows momentum direction (which way price is moving)
Price Div: Raw "how far from fair value" - responsive but noisy
Least Squares Div: Smoothed "how far from fair value" - cleaner but slower to react
The most used of these settings have predefined presets that you can use.
Reading the Signals:
Three Key Insights
Signal 1: Power Crossover When Bull Power crosses above Bear Power (specifically, Bull crosses above -Bear), this is an alignment signal. Buyers and sellers are shifting positions, creating potential trade opportunities.
Signal 2: Power Strength Changes Watch for increasing or decreasing intensity in the colors. Darker/stronger colors mean power is building. Lighter/weaker colors mean that power is diminishing. This shows if a move is accelerating or losing steam.
Signal 3: Extreme Divergence When Bull Power forms lower highs while price makes lower lows, or Bear Power forms higher lows while price makes higher highs, divergences signal potential reversals.
Display Mode Breakdown:
- Histogram: Best for seeing individual bar strength; easiest to spot changes in intensity
- Line: Best for tracking smooth trends and crossovers; less visual clutter
- Band: Best for understanding volatility context; upper/lower bands show potential extremes
Please read the blog post for detailed settings and more information.
