Accumulative Swing Index ASI Indicator For MT4
Table Of Contents:
- Accumulative Swing Index ASI Indicator For MT4
- Parameters of the Accumulative Swing Index ASI Indicator For MT4
- Some of the Advantages of Using the Accumulative Swing Index ASI Indicator For MT4
- Some of the Disadvantages of using the Accumulative Swing Index ASI Indicator For MT4
The Accumulative Swing Index ASI Indicator For MT4 is an indicator that can help traders to easily identify the accumulation and distribution patterns on their trading charts in Meta Trader 4 platform.
Partially Automated Trading Besides Your Day Job
Alerts In Real-Time When Divergences Occur
Parameters of the Accumulative Swing Index ASI Indicator For MT4
Tolerance (T): The Accumulative Swing Index ASI Indicator For MT4 has a single parameter - T. The parameter can be used to adjust the degree to which the indicator zooms in or out as it looks for the accumulation and distribution patterns on the currency pair or trading asset that it is used on.
Some of the Advantages of Using the Accumulative Swing Index ASI Indicator For MT4
Several advantages can be derived by a trader when he or she uses the Accumulative Swing Index ASI Indicator For MT4 in his or her trading.
One of these advantages is that the trader would be able to see accumulation and distribution play out in realtime in his or her charts. This implies that the trader who has the Accumulative Swing Index ASI Indicator For Meta Trader 4 Platform attached to his or her trading charts would be able to easily spot when there is potential accumulation or distribution in whatever currency timeframe of the trading asset or currency pair that the trader is observing during the trading day.
This is very important to the trader as it can help him or her to be able to understand how the market works in terms of how the big banks and big traders accumulate trading positions quietly and how they distribute these trading positions to retail traders. The trader would also learn to automatically identify these price patterns in the future even without the help of the indicator and improve their trading as a result.
Once a trader becomes able to identify these accumulation and distribution patterns as they form in the price of his or her charts, it would easily help the trader to ensure that he or she places trades only on the right side of the markets whenever he or she is trading.
Also, since the trader becomes able to identify exactly what the correct direction to align or bias his or her trades to is, he or she becomes able to ensure that all of his or her trades are in this correct direction of the market during the trading day.
Being in the correct direction of the currency pair or trading asset would then help the trader to be able to avoid huge losses. These huge losses are usually as a result of the market moving very strongly against a trader's position.
In order to understand this, the trader would need to understand the way the market works. The first thing to always remember is that the market is fractal in nature. This means that the exact patterns that a trader sees on one timeframe can be repeated on a lower timeframe of the same currency pair.
Secondly, the trader would also need to note that the market is comprised of trends and these trends are either moving in the upward direction or the downward direction as the market develops.
These individual trends that are either moving in the upward or the downward direction of the market during the trading day are comprised of much smaller fractal trends that are also moving either in the upward or the downward direction of the market in the same way as the bigger trends. These smaller trends can be called waves for the purpose of illustration.
An experienced trader would be able to look at the markets and see that all of these price waves that comprise the trend are usually either longer or shorter depending on the direction that the price waves are moving in relation to the current trend in the market on the trader's charts.
Looking at the smaller fractal trends in correlation with the larger trends makes it very easy for the trader to see that the price waves that are in the direction of the larger trend tend to move much faster and longer than the price waves that are in the opposite direction to the direction the current trend is moving in the market.
Being able to observe this can help the trader to be able to mentally visualize what the potential damage that placing a trade in the wrong direction would do to his or her equity during the trading day especially if he or she does not actively manage risk.
Another important advantage of using the Accumulative Swing Index ASI Indicator For Meta Trader 4 is that it can help te trader to spot when a price reversal is about to happen. This is especially important to traders who already have profitable trades running in the market.
Once a trader can spot these price patterns using the Accumulative Swing Index ASI Indicator For Meta Trader 4 and is aware that the patterns usually indicate a rather high probability of the price reversing, the trader would then be able to either exits some or all of his or her trades. The trader would only exit some trades if he or she wants to see if the reversal pulls through before he or she can then take off the remaining positions.
Some of the Disadvantages of using the Accumulative Swing Index ASI Indicator For MT4
One of the disadvantages of using the Accumulative Swing Index ASI Indicator For Meta Trader 4 is that it can make the trader lazy. This is because both the accumulation and distribution patterns were traditionally learned on naked charts so that the trader would be able to immediately spot when these price patterns appear on any charts without the need for any additional indicators.
Another disadvantage of using the Accumulative Swing Index ASI Indicator For Meta Trader 4 to generate trading signals is that sometimes, the market might not reverse at the end of the patterns. A trader can still trade profitable if he or she first allows the patterns to make price move in the new direction before entering any trades.
