This is a hybrid indicator that combines the Didi Index with the Average True Range. It acts as both an ATR and a Confirmation indicator, based on the No-Nonsense Forex (NNFX) trade rules.
The Didi Index takes three moving averages to build a fast line (MA1 and MA2) and a slow line (MA2 and MA3). You can use it several different ways (2 lines cross, zero-cross); in this setup, we only use the slow line with the zero-cross to produce a signal (source code is set up to take advantage of the fast line - you just need to plot it yourself). ATR is a measure of candle volatility.
The plotted value is equal to the ATR, which then gets colored based on: Black: Didi Index is below 0 - do not enter trade Red: Didi Index is above 1, but the previous candle closed >1x ATR - do not enter trade (too volatile) Green: Didi Index is above 1, and the previous candle closed <1x ATR - a possible trend is confirmed and you may enter the trade (use other indicators too)
The provided chart does not look exciting - as with NNFX, I am posting it with the OANDA:EURUSD, which is one of the harder FX pairs to trade.
Informacje o Wersji
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- Updated the script to include long and short signals - Code and comments are a bit more readable - Added support for all the ta.ma() variants that come with v5 scripts (and it's easy to copy and paste them for yourself too! ;)