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The Aroon MT5 indicator is used in the forex system to determine the price direction, identify the relative strength of trends, detect local minimum and maximums and, accordingly, to receive trading signals. The main purpose of this indicator is to weaken or strengthen uptrends and downtrends within a certain period . The indicator consists of two lines Aroon Up and Aroon down" These lines are in a limited range - from 0 to 100.
The Aroon Up line is used to determine the period that has passed since the formation of the absolute maximum during a certain period, the Aroon down line - to determine the absolute minimum during a given period.
This algorithm was created to determine the local top and bottom on the chart to which this indicator is connected. The indicator provides signals to buy and sell certain currency pairs, when they rise from the minimum or fall from the maximum of the day. The intersection of the lines creates the possibility of profit taking or a loss with a good signal. The indicator can send signals about the intersection both by e-mail and issue a signal in a window of the standard platform .
Input parameters of the Aroon up & down indicator
Aroon Period is set on period 14 by default. Setting this or that period will affect the search for tops and bottoms in bars on the selected period. And the larger the period value, the smoother the lines will be, respectively, the smaller the period value, the more signals are generated .
Mail Alert is set to false by default. When set to true, an indicator crossover alert will be sent by email according to your trading platform settings.
Sound Alert is set to false by default. When set to true, a visual and audible signal about the intersection will be given in the standard platform window.
Definition of signals of the indicator Aroon up & down
Determination of trend direction:
Determining the trend using this indicator is very simple, since the lines are located at the level from 30% to 70%. In an uptrend, Aroon Up rises above 70%, and sometimes it can reach 100%, and Aroon Down falls below 30%, sometimes reaching 0 %. In a downtrend, everything happens exactly the opposite.
Line crossing:
When the Aroon-Up line leaves the 30% zone and simultaneously crosses the descending Aroon-Down line from the bottom up, a buy trade is formed. At this point, a new uptrend is forming, which is an excellent opportunity to open long positions. A sell trade Aroon occurs when Aroon-Down, leaving the 30% zone, crosses the descending Aroon-Up from below.
Conclusion
Based on the above, it can be understood that the use of the Aroon up & down indicator is not only profitable, but also simple, which is especially good for beginners. It easily determines the main trends, is universal for various trading instruments and platforms, easily determines the main trends, is used on both small and large timeframes, with the right settings gives good accurate signals.
