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Simple Indicator Request (MACD)

  • #1
  • First Post: Sep 4, 2011 7:56am Sep 4, 2011 7:56am
I have what I consider a pretty simple request. I very much like using momentum as an entry confirmation indicator, but my current weapon of choice (MACD) takes up far too much space on the chart. I don't use the histogram at all and I'm only interested in determining whether the difference between two moving averages is increasing or decreasing or in other words, momentum.

So basically what I need is an indicator that measures the difference between two moving averages (exponential in my case) and colors the bars either green (when the difference between them is growing) or red (when the difference between them is decreasing). No histogram needed!

---

I have attached below a chart with nxMACD, which is a colored version of MACD. It is set to show green bars when the difference between EMA 5 and EMA 10 is growing and red when the difference between them is shrinking. I'm only using the MACD because it allows me to see the see the change in momentum. You will notice that I don't make use of the third variable (signal SMA) at all and I'm not interested in that.

I have already thought of a name for this indicator as well - MAD - moving average difference.
Attached Image (click to enlarge)
Click to Enlarge Name: macd.gif Size: 38 KB
If you don't risk, you don't ever have to lose.
  • #2
  • Sep 4, 2011 5:15pm Sep 4, 2011 5:15pm
hey bug..... this should be close..... keep in mind, the small differences involved can be a real pain......h
Attached File(s)
File Type: mq4 mad.mq4   3 KB | 513 downloads
to trade and code, keep both simple... no call to impress....h
  • #3
  • Sep 5, 2011 3:00am Sep 5, 2011 3:00am
Quoting hayseed
hey bug..... this should be close..... keep in mind, the small differences involved can be a real pain......h
Hey hayseed,
the indicator fits my description 100%. Thank you!

What small differences should I be aware of? I did some visual testing and I discovered no flaws myself.
Attached Image (click to enlarge)
Click to Enlarge Name: macd --vs-- mad.gif Size: 32 KB
If you don't risk, you don't ever have to lose.
  • #4
  • Edited 5:13am Sep 5, 2011 4:05am | Edited 5:13am
hello Sir bug,
i didnt know u are MAD. Sir hayseed is mad too
  • #5
  • Sep 5, 2011 6:23am Sep 5, 2011 6:23am
hey bug..... the values can get extremely small..... possibly too small...... when comparing extremely small values there is the risk of a rare comparrison error....h
to trade and code, keep both simple... no call to impress....h
  • #6
  • Sep 5, 2011 9:07am Sep 5, 2011 9:07am
Quoting hayseed
hey bug..... the values can get extremely small..... possibly too small...... when comparing extremely small values there is the risk of a rare comparrison error....h
Well, so far I haven't noticed anything strange and I expect these 'extremely small' differences to be rather rare. In any case, I only use MAD to time my entries, not the direction of entries. If I'm looking to go long I want the momentum behind me (green bar). Seeing a red bar won't push me into selling so you needn't worry too much.

Again, thanks for your time and efforts!

------------

Quoting supremeChaos
hello Sir bug,
i didnt know u are MAD. Sir hayseed is mad too
?
If you don't risk, you don't ever have to lose.
  • #7
  • Last Post: Sep 5, 2011 1:59pm Sep 5, 2011 1:59pm
Quoting bug
...
?
just teasing u with your new MAD indicator (MAD - moving average difference)
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