MA_MODE created by Goen and approved by KG
0 = Simple Moving Average (SMA)
1 = Exponential Moving Average (EMA)
2 = Smoothed Moving Average (SSMA)
3 = Linear Weighted Moving Average (LWMA)
For download this indicator please click here ==>
USD/JPY Case on Maret 2008
Let Observe in M15 TF , Daily and Weekly MA tend to start moving flat, its meaning that if they fall trying to give more attention to the Daily Lower BB (dashed Lime) and weekly (dashed magenta), follow the small trend 8 hours, 4 hours or 1 hours to take exit decisions. And now price was in the area of Lower BB weekly, for these conditions as described in the beginning, it is best to OP buy at lower BB and OP sell on the Upper BB with observe over the small movements trend.
USD/JPY Case
From the picture seen that KG take buy position, from M15 chart analyze seen that daily and weekly LWMA tend to be flat, and from price movement prove that price reverse back and rise after touch weekly lower BB.
OP's Target can be done by following the small trends, if the price is able to pass through daily WMA, Upper daily BB or around the weekly WMA will be the first target, if not should close position.
USD/CHF Case
This case is similar with UJ Case, where the OP do is BUY. Daily WMA96 movement began Flat and the price is almost touching the lower BB 96, then prices seen moving up or "bounce", which became the target is the Upper BB 96, but also observe the price movement around the WMA 96, if not able to pass through WMA 96 should close the position.
EUR/USD Case
WMA 96 Position has shown Flat, but the price has not reached the Upper BB 96, but KG did OP SELL, by observing the movement of WMA 4 (houry : red color), the first target is the Lower BB 96, but if the price does not successfully pass WMA 96 should close the position.
GBP/USD Case
In this case KG choose OP Sell, daily look is toward a flat condition, and it is also quite dangerous, but see 1 hour and 4 hours WMA an already crossing, then the price was in the BB 96 and there is enough space from price running into the WMA 96.
Flat condition is very important to note, do not use MA trend that is in the Flat condition as the main criterion, MA that in a flat condition is used to set limits using BB.
Use the higher MA as the benchmark and more small MA as a director, but focus on the MA which is smaller, because MA that is flat is finally going to follow movement of a smaller MA, trying to observe if the upper or Lower BB from the breakout of Flat MA then MA or Middle BB will follow the direction of the small MA.
According to KG, Flat conditions are ideal conditions for entry, although other sources may be at odds with this, for KG Flat condition is the sought conditions. Then also keep in mind that go in trending conditions were very dangerous (this is also contradicted by other sources), because after all unknown, "Is this trending will end or continue?"
For OP at the trending time can be done in the following manner:For example, the daily movement in a state trending, See the movement of 8 hours, 4 hours and 1-an-hour, wait or look for three points among these smaller movements that are in the Flat condition, make BB from it and go through there with BB rules.
For download indicator that match with LWMA click here ==>
Trend that given by KG MA indicators can be different in some of the TF, but it must be recognized that the indicators do not lie or wrong, because the indicator is only doing the calculations and logic programmed in it. So anything that is produced by this indicator is TRUE condition based on the programmed conditions.
What causes these differences is that the data used to calculate the average value is also different. On the M15 to calculate the average value of mean daily movement, it mean indicator will calculate the price that selected (Close, Open, High, Low, HL / 2, HLC / 3 or HLCC / 4) in 96 previous candle and then calculate the mean value. While in H1 indicator will calculate the price value contained in 24 candles before then calculate the mean value.
According to KG, mathematically and statistically the average calculation using more data better reflect the real situation, then give more attention to the smaller TF.
KG advice: "Eliminate the LATE term from your mind, replace it with Is there still a chance or not?"
It should be noted that not only the upper / lower BB are its boundaries, lines of the MA that is used can also serve as the boundaries of movement.
Then should have to know the average value of daily, weekly and monthly static movements, this is used to compare and know the price range that formed at this time with an average value of daily, weekly and monthly periods ago.
For the indicator about the above, download it from this link ==>
Then, "Bar Indicator" for calculate close-open value of a given MA period =>
The previously average value that used as a comparison is actually have a important information, for example: "If the price is currently engaged and exceeds the previously average values and then followed by curently daily moving average which also exceeded the previous daily average, this indicates that the movement that happening today is pretty strong". It is also seen in the image below:
On GBP/JPY pair, flat lime line is the previous daily average value taken from SMA 1 on D1 and flat magenta line is the previous weekly average value taken from SMA 1 in W1. OP look contrary to what has been presented before, but this can be explained by the following analysis:
"Judging from Weekly MA (magenta line) actually price looks flat, the taken action should sell in Upper BB and Buy in Lower BB, but when price seen bouncing on the previous daily average (lime line), most likely this is the limit of current GJ retrace. After a while the daily SMA moves through and past the previous weekly average (magenta line) and even continues to penetrate the previously average price (lime line)".
And as it is known that:
If the price is currently move and exceed the previous daily average then followed by the value of curent daily average movement which also exceeded the previous daily average movement, this indicates that the movement is happening today is pretty strong.
So the right decision is OP Buy.
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