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The iTrend indicator is an algorithm based on two effective Forex indicators, Moving Average and Bollinger Bands, included in its standard set. The algorithm derived from these indicators is used to determine the current trend and its strength, this information, in turn, allows consider opening certain trades. The indicator is displayed in the lower window of the price chart as a colored cloud with a signal level of 0. The color of the indicator will determine the direction of the current trend, and the width will determine its strength. And thus, taking into account these factors of the indicator, a certain trade can be opened.
The iTrend indicator is suitable for trading on any timeframe using any currency pairs.
Input parameters
The iTrend indicator settings consist of several sections, each of which is directly related to the general indicator settings. The Input parameters section affects its technical operation, while the Colors section only serves to change visualization parameters: color and thickness. The Levels section is responsible for adding to signal level indicator window, in addition to the already added level 0.
- Price Type - price type to which the general indicator calculations will be applied. By default, it is set to Close price.
- MAperiod - period of the moving average used in indicator calculations. The default value is 13.
- MAtype - type of smoothing of the moving average of the indicator. The default value is Exponential.
- MAprice - the price to which the calculations of the moving average of the indicator will be applied. The default value is Close price.
- BBperiod - value of the period of the Bollinger Bands indicator. The default value is 20.
- deviation - deviation of the current values of the Bollinger Bands indicator from the standard ones. The default value is 2.0.
- BBprice - type of price to which Bollinger Bands calculations are applied. By default, it is set to Close price.
- BBmode - the type of Bollinger Bands to use. Default is Baseline.
Indicator signals
In order to open a certain trade using the iTrend indicator, no particular effort is required, since the algorithm for using the indicator is very simple. When trading, it is only important to take into account some indicator factors, namely its current color and width. If the indicator determines an uptrend, buy trades are opened, if the trend is down, sell trades. Certain trades should be closed when the current trend changes, that is, when opposite conditions are received from the indicator.
Signal for Buy trades:
-The indicator cloud has a color with a growth value and is equally wide with respect to level 0.
Upon receipt of such conditions, a buy trade can be opened on a signal bullish candle, due to the presence of an uptrend in the market. Such a trade should be closed when the current trend changes, that is, when the opposite conditions are received from the indicator. At this moment, it can be considered opening new trades.
Signal for Sell trades:
- The indicator, colored with the drop value, is wide on both sides of the signal level.
A short position can be opened immediately after receiving such conditions characterizing a downtrend on a bearish candle. The trade should be closed when the trend changes, that is, when opposite conditions are received in the indicator window, this in turn will allow considering the opening new trades.
Conclusion
The iTrend indicator is a very effective trading algorithm, since it is based on standard time-tested indicators. Their combination is not only very simple and convenient, but also very accurate in signals. To obtain the necessary knowledge in using the indicator, it is recommended to use a demo account, which will also strengthen trading skills in general.
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