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The Trend Direction and Force index smoothed indicator is a special trading algorithm designed for trading during a certain trend on the market. Thus, the indicator's calculations are aimed at determining the presence of a trend, its current strength and direction, which in turn allows determining the moment of opening a trade. The indicator is presented in the lower window of the price chart as a solid line with a signal level, which changes its color and direction depending on the current market conditions. Taking into account the current values of the indicator, the market movement is determined, and at the same time, a certain position is opened.
The Trend Direction and Force index smoothed indicator is suitable for trading any currency pairs on any timeframe. The indicator is also suitable for use in multi-timeframe mode
Input parameters
The settings of the Trend Direction and Force index smoothed indicator consist of several sections. The Input parameter section is responsible for its technical operation, the Colors section is used to change visualization parameters, and the Levels section is used to add signal levels to the indicator window.
-TimeFrame - parameter for using the trading timeframe. By default, it has the Current time frame value.
-trendPeriod - period for calculating the indicator trendline. The default value is 20.
-TriggerUp - parameter responsible for triggering the line with the growth value. The default value is 0.05.
-TriggerDown - line trigger parameter with falling value. The default value is -0.05.
-SmoothLength - parameter for applying smoothing calculations. The default value is 5.0.
-SmoothPhase - the moment when smoothing is used. The default value is 0.0.
-ColorChangeOnZeroCross - parameter to change the color of the indicator line when the line crosses level 0. The default value is false.
-alertsOn - the option to have notifications when an alert is received. The default value is false.
-alertsOnCurrentBar - signal parameter on the current bar. By default, it is set to true.
-alertsMessage - Alert message option. Default is true.
-alertsSound - option to sound notification when an alert is received. The default value is false.
-alertsEmail - Alert the indicator in the form of an e-mail. The default value is false.
-Interpolate - parameter for using the indicator in multi-timeframe mode. The default value is true.
Indicator signals
The algorithm for applying the Trend Direction and Force index smoothed indicator is very simple. To open a certain trade using the indicator, its values should be taken into account, namely the color, direction and location of its line relative to the signal level. If the current market trend is upward, long positions are opened, if the trend is downward -short positions. At the moment of trend change, trades are closed. At the same time, at the moment when there is no trend, that is, the indicator line is at level 0, trades are not opened.
Signal for Buy trades:
- The line of the indicator, colored in color with the growth value, is directed upwards and is located above the level 0.
Upon receipt of such conditions on a candle, confirmed by the indicator signal, a buy trade can be opened. At this moment, an uptrend is determined in the market. When it changes, namely upon receipt of reverse conditions from the indicator, the current trade should be closed and a new one should be considered.
Signal for Sell trades:
- The indicator line has a color with a falling value and, heading down, crosses the level 0.
A sell trade, due to the presence of a downtrend, can be opened immediately upon receipt of such conditions on the signal candle. At the time of the change in the current trend, namely, when the opposite conditions are received from the indicator, the trade should be closed. This, in turn, allows considering opening new trades.
Conclusion
The Trend Direction and Force index smoothed indicator is not only simple, but also very effective to use. Its calculations are accurate, however, to improve the quality of trading, it is recommended to use it with additional indicators, advisers and filters.
