(binned per thread starter’s request) Indicators for Discretionar

With too much time on my hands and energy to spare, lately I've found myself getting into / causing trouble on other threads. Ironically, it was my arch nemesis @moodybot who suggested I escape the drama and, instead, start a new thread and share some unique indicators. @moodybot will probably fall off his chair when he reads this -- he was right, and I've decided to take his advice. Thanks, Andy...

The indicators that I'd like to share with you are intended for manual / discretionary trading. I'm not going to rank them or make any guarantees -- I'll leave that for you to decide. However, I would like to emphasize that an indicator is a tool, like a hammer. A hammer in the hands of a master craftsman can build a beautiful house, but the same hammer in the hands of a novice carpenter will result in a leaky shack. The same with indictors -- it's not the indicator, rather, it's the trader.

With that said, here are a few simple rules that I request be followed. I understand most adults are incapable of following simple instructions, so my expectations are not very high:

1. Do your best to maintain civility.
2. Do not ask for source code -- the answer is 'no'. My source code uses templates that pull in many headers files, and I'm not giving out my build system.
3. Do not ask for an EA -- the answer is 'no'.
4. Do not ask for alerts, color changes, etc -- I'm not your personal coder.
5. I will not provide trading advice (I'm still a rookie), but others may.
6. If you have an idea and suggest I should try this or that, then please back it up with some evidence. I'm not going to spend a week of my time coding your hunch.

Most of the indicators presented here are intended to be used from an H4 chart. Of course, you are welcome to attach them to any time frame -- but H4 generally works best.

Most indicators that I'll be sharing here have never been posted before. However, in the past I have posted a number of indicators in my other threads and I reserve the right to re-post refurbished versions of them here.

One last point before I get started -- I am not a clever fellow, but I am a good mechanic. I do not develop algorithms. However, as a software developer I can merge algorithms to create new "hybrid" indicators. And that's mostly what you'll find here. "We stand on the shoulders of giants" and I neither expect or deserve credit. If I do not explictly site the authors of the indicators that I draw from it does not mean I don't appreciate their work -- I do. My thanks and appreciation to:

1. @SwingMan -- a most gracious man who continues to develop and share the most innovative software (https://www.forexfactory.com/swingman).
2. @Nih98 -- a mentor for many of us here and who passed away last year. I miss him greatly (https://www.forexfactory.com/nih98).
3. @mladen -- who I have never met -- but it's fair to say that many / most of the indicators we use today were derived from one of his incarnations (https://www.forexfactory.com/mladen).

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For fun and to help keep me engaged with this thread, I've decided to add some "proverbs" along the way. Don't take them too seriously -- they are a blend of sarcasm and exaggeration, with a bit of truth mixed in...

* Proverb #1:
Traders who request hand-holding will never be profitable -- their needs will never be met and that will be reflected in their trading skills or, more accurately, lack of trading skills. The biggest favor you can do yourself is be prepared to stumble and learn to rely on yourself.

* Proverb #2:
Traders who suck-up or brown-nose in the hope they will receive some magic sauce in return will never be profitable. For one thing, there is no magic sauce. And for another, the person they are sucking-up to are most likely a failed trader masquerading as a successful one. If there is such a thing as "magic sauce", then it comes from you. You are the one that creates it.

* Proverb #3:
If a trader claims to be a goat you should ignore them. I've never met a profitable goat and they are certainly not to be trusted.

R4M-BBIITX Indicator

One of my favorite indicators is R4M-BBIITX. It combines Bollinger Bands, IINWMARROWS and Trix. Blue and purple dots represent transitions, blue and purple lines show bullish and bearish trends (respectively), and red 'x's show where a trend ends. There are several ways to trade with this indicator and I'll suggest one:

Enter a BUY or SELL at a transition, and Exit at a red 'x'.

Repainting Versus Recalculation

Recalculation and repainting are two *COMPLETELY* different phenomenon related to how bar data gets displayed by MT4. If you are even half-way serious about using indicators then you really should know how to check this yourself. It's not difficult -- use Google to search how to do it. It might take you 5-10 minutes to learn how. And from that point on it only takes a minute, or so, to determine if an indicator repaints. And the understanding you'll gain will make a huge difference in how you look at bar data.

ALL indicators that use the current close price will recalculate. The only exception I can think of at the moment is maybe fractals -- but that's because fractals are delayed 2-3 bars. Recalculation is fine -- it is an artifact of charting an algebraic equation that uses the current price -- i.e. Bar[0]'s closing price -- which fluctuates with each tick.

Repainting occurs when an indicator uses more recent price data and goes back in time to modify its previous markings. Visually this has the effect of making your brain think the indicator will work great for trading because it fits so well with the data. But when trading in real-time, you'll probably be in for some surprises.

Repainting is usually an artifact of the algorithm. If an algorithm can be modified to not repaint, then the developer probably would have done that in the first place. In other words -- if it repaints then that is probably something you'll need to live with.

Most traders when they hear the word "repaint" then they run screaming for the hills. But that is an overly simplistic and naive response. An indicator is a tool -- like a hammer. A hammer can be dangerous -- you might hit your thumb. So, some people would advise never to use a hammer. However, in the right hands a hammer can be a very useful tool. Same way with indicators -- even ones that repaint.

Another thing about repainting indicators -- not all repainting is the same. For some the repainting is so severe that the indicator is unusable for real-time trading (e.g. ZigZag). And for others the repainting is subtle and only occurs when there are large fluctuations in price.

"Head-Fakes" and False Positives
R4M-BBIITX vs Stochastics (8,3,3)

I believe the greatest obstacle we need to overcome when using indicators are the "head fakes" (i.e. false positives). These are what also plague EAs. When discretionary trading you can incorporate other clues or hints that are not available to an EA. The benefit of an EA is that it is automated -- but discretionary trading will always be more accurate. Those are the trade-offs.

Below is a comparison of the R4M-BBIITX indicator versus Stochastics (8,3,3). The vertical red lines mark a few locations where the Stochastic indicator crosses the 80 threshold downward and which, in real-time, might cause you to open a SELL position. But you can see that the R4M-BBIITX indicator is better at ignoring those "head fakes".

R4M-DSS-Bressert Indicator

The screen shot below shows the R4M-DSS-Bressert indicator. The white and red circles mark transiitons between bullish and bearish trends, respectively. The blue dots are used for a bullish trend and the purple dots for a bearish trend. I've included the R4M-BBIITX indicator in the upper window for comparison purposes. For the most part signals from the two indicators align -- but not always. It's up to the trader to decide which indicator is better suited to the current data horizon. And this may change from pair-to-pair and different market conditions.

R4M-SignalLine Indicator
R4M-LazyTMA Indicator

The screen shot below shows the R4M-SignalLine indicator. The markings should be self-explanatory.



The image below is of the R4M-LazyTMA indicator -- another one of my favorites. It is derived from master @SwingMan's LazyTMA indicator. Credit also goes to @mladen for his centered TMA indicator. The reason I like this indicator is because it provides a "context" when combined with other indicators. When viewed from a distance it becomes clear that price almost always returns to the midline / fair-value / equilibrium.

The blue midline is the centered TMA. The yellow bands are a %ADR distance from the midline. Using the input dialog you can adjust the %ADR for each particular time frame.


And lastly, the screen shot below shows the R4M-LastTMA indicator overlayed on the R4M-SignalLine indicator. You can see how the TMA midline and ADR bands provide a context that includes the SignalLine markings. I've often used such an indicator for reversal trading -- i.e. when price rises above / below the ADR band, then trade-away.

R4M-RecentTrades

This indicator draws markings of your recently closed trades. A blue circle means it was a BUY and a purple circle means it was a SELL. The dot in the middle indicates whether the trade exited with a profit (white dot) or loss (red dot).

The input dialog allows you to filter for Magic Number or Magic Group ID. Magic Group ID is something I've used on my other threads and would prefer not to go into it here. For now I'd recommend sticking with the default 'All Trades' or 'Use Magic Number' if you know what it is.

Very interesting. Looking forward to the rest. Thank you

Finally...the thread I can follow with interest!

R4M-TrixIndi

Screenshot of the R4M-TrixIndi (lower window) and R4M-LazyTMA (upper window) for context.


One recommendation for how to trade this, though you may find others:
BUY -- when blue dots align with green and blue lines
SELL -- when purple dots align with red and purple lines

Also, I always keep my eye on the centered TMA and ADR bands. If the price is below the midline and trending upwards then that's a higher-probability BUY, and if price is above the midline and trending downwards then that's a higher-probability SELL.

R4M-Detective

The R4M-Detective indicator shows the 'lifetimes' of TOPS and BOTTOMS -- i.e. where they get created and where they get removed (by extreme price spikes).



The screenshot below shows the R4M-Detective indicator overlayed with the R4M-LazyTMA (centered TMA) indicator. If you look closely you may see how this could be used for reversal trading -- i.e. trading away from an extreme price. When a TOP or BOTTOM is revisted then some traders interpret that to mean the price has touched a "liquidity pool", which explains why it will then move in the opposite direction.

Unfortunately it hardly repaints. You think you will enter when spike up or down, in fact your entry will be lower/higher. And TP on center line also mostly will be in loss.

@ryuryu -- that the centered TMA slightly / occasionally repaints is old news. I'll refer you to post #3 above. I think I've mentioned it multiple times -- the centered TMA with the ADR bands provides a context. A context is not a signal -- you don't trade it. A context provides a clue / hint as to where the price currently sits within the channel / envelope -- whatever you'd like to call it. If you're not inclined to see the envelope then hop on over to @parisboy's thread -- he knows the theory better than anyone, like the back of his hand.

And if you don't like the centered TMA -- that's fine. I'm not forcing you to use it. I'm not even encouraging you to use it. It's just that a lot of people do find it useful when combined with other indicators. I also like it and that's why I'll often show it.

Let's leave it at that -- I'm not really into debating the pros and cons right now. Lately I've been getting into too much trouble elsewhere and I don't want to get started here.

R4M-CCIMA-Indi

The screenshot below (middle window) shows the R4M-CCIMA-Indi -- a smoothed version of CCI. Blue lines indicate a bullish trend, purple lines a bearish trend. The dotted yellow bands are the Bollinger algorithm applied to the CCI algorithm. As you can see it creates a channel / envelope. Again, the purpose of the channel / envelope provides a "context" and another clue in your discretionary decision making. The bottom window displays MT4's built-in CCI indicator, for comparison purposes.

Thank you for sharing and for your thread, but I think this indicator is totally fake. As you mentioned before repaint if candle forming and repaint historical data is very big difference. Indicators repainting the past used only by fake course/signal/ea sellers.

The problem that it will not give you a context, since it repaint itself. It shows wrong data and it is 100% not equal with the data from that time. In fact it can be used only on flats, on trending markets it is totally useless and even extremely dangerous. And I hardly can imagine the situation when someone will use it for real trading. It is just impossible.

@ryuryu -- okay, I'll briefly indulge you. You claim "this indicator is totally fake". I'll give you the benefit of the doubt you are not a native English speaker and don't realize how that comes across. And I'm not being condescending of non-native English speakers -- I can count to 10 in Spanish and that's it. This indicator was derived from @SwingMan's version, which was derived from @mladen. It has a distinguished pedigree. To call it fake is like saying Michael Jordan is a fake basketball player.

As I tried to explain in an earlier post -- repainting is not the end of the world. Furthermore, if an indicator repaints that doesn't mean it *always* repaints. Most of the time centered TMA does not repaint. However, when there are very large bars then they may pull the lines up or down. But as a discretionary trader you are using your brain and you can see large bars and that's when your brain tells you -- "Oh my, look at those large bars. I had better tread carefully because they may pull the centered TMA up or down".

Besides centered TMA there are other TMAs that never repaint -- and you should check them out and compare them with the centered TMA. And then things may become more clear. Just as in life -- everything, everything, everything comes down to trade-offs. The benefit of the centered TMA is the smooth lines that often help you see patterns that you wouldn't otherwise. The benefit of non-centered TMAs are they don't repaint -- but they are unsymmetrical and extend far above and below the actual price line such that they don't form a nice envelope. Again -- it's a trade-off. If non-centered TMA works better for you and you are willing to put up with the unsymmetrical channels in return for no repainting -- then you have your solution. And for people who appreciate the centered TMA and can accommodate occasional repainting, then they have their solution.

"And I hardly can imagine the situation when someone will use it for real trading. It is just impossible."
@ryuryu -- trading is not a theoretical exercise you perform in your head. The fact you can't imagine someone using it doesn't mean someone else couldn't make use of it. Once you step into the trenches and actually begin trading then you will find what works and what doesn't work for you. Just because I can't dunk a basketball I would never say it was impossible (for everyone). I am old enough to be able to make the distinction between what is impossible for me and what is impossible for everyone else in the world -- they are not the same.

Don’t forget the title of this thread is "Indicators for Discretionary Trading"

TMA-ADR actually does a pretty solid job of defining the boundaries within a range. Since FX ranges for 85% of the time, it can be a useful tool if you know how to use it. I’d forgotten about how useful it is on H4 charts.

Of course, if you try and use it for counter moves in wild trending moves it is not going work. TMA is designed to follow price relatively slowly. You can also use it in in other ways and keep you from doing crazy stuff like buying breakouts in ranges.

There is no such thing as a holy grail indicator, this thread is about the tools Steve has freely created and perhaps you can build them into your existing strategy or not.

This thread has reminded me of the BDX days of last year and that sparked a few good memories.

Nice stuff, Robot. When possible, can you post .mq4 files? Thanks.

R4M-ADRIndi

The screenshot below shows the R4M-ADRIndi. It differs from other ADR indicators in that not only does it mark the current session's ADR but also historically. If using this indicator to trade in real-time you have to be cognizant of the fact that early in the session it doesn't know what that session's High and Low will be -- so the white band for the current session will shift up and down with each new bar. That is NOT repainting. It's just an artifact of how ADR works.


And here is a screenshot of the centered TMA layered on top. The combination of the two provide a nice view from 30000 feet. You can see that price really tries to stay within the bounds of the channel -- always returning to the midline / equilibrium / fair value. On an H4 chart the distance from the midline to an outer band is 1xADR.

Hi R4M
I have an idea for a simple indicator for entry signal and the context can be your ADR or TMA or whatever you like.
It's simply based on stochastic +RSI.
Please send me a PM with your email so I can send you some pictures and explanations.
Cheers