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Price Speed

It is very important to know the speed of the price change when creating a trend strategy. Usually, the Momentum indicator is used for that purpose; however it shows a relative change in percentage terms for a selected period. Sometimes it may be inconvenient, since the indicator values are period dependent. The values change from a fraction of a percent on small periods to several percents on large periods, what causes some difficulties with calculating, especial the Stop Loss and Take Profit orders.

The Price Speed indicator calculates the absolute change of the price in points divided by the timeframe. In other words, it shows the average speed of the price for a given period measured in pips/timeframe, what corresponds to the definition of speed in physics. Interpretation of the Price Speed values is easy and convenient; it can be used for formalization and automation of trading strategies. Oscillator values higher than the zero line correspond to an ascending trend, value lower than the zero line correspond to a descending trend.

There is the Period parameter that allows selecting a period for the calculation of the speed.

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