Angle of Averages Indicator For MT5
The Angle of Averages Indicator For MT5 calculates the angle of a moving average. Angles can show you the strength of a trend. Steep angles determine strong trends. The indicator draws green areas during strong upward trends and yellow areas during strong downward trends. The grey areas are showing price action where the angle of the moving average is quite flat.
The Angle of Averages Indicator For MT5 is one of the most elegant tools that work on the smart calculation. Indicators that works with two-axis data usually depends on complex algorithm since two different sets of data need to be considered for formulating the imported data into reading.
But the angle of averages indicator works on a different formula. It creates the colored histogram based on the ATR formula. That means the average pips movement is considered for creating the reading in the angles of averages indicator. The indicators have a dual function. It can act as a filter and you can also consider it as a trade triggering tool.
In case, you are developing a new trading method, it is better not to consider the angle of averages indicator as a filter tool. You get the best result when you make it an integral part of your trading strategy.
Trading ideas with the Angle of Averages Indicator For MT5
Some of you might have an existing trading strategy. But there is nothing to worry as the angle of averages indicator can be synced with an existing edge without having much trouble.
People who are trying to boost their trading skills by following the strategic approach at trading should learn to use this tool. It can help you to determine the potential trade setup with a high level of accuracy even acting as the filter. But you have to know how the bars and changes in the color of the bar react with the different states of the market.
It might sound very confusing at the initial stage but once you learn to take the trades with a strategic approach, you should be able to change things fast. It will provide a great level of ease in the trading business and offer you a classic solution in real-time.
Angle of Averages Indicator For MT5 - Buy Entries
Buying any asset requires a strong knowledge of the support level. People who have a strong trading method, usually take long trade at the important support zone. But finding the important support zone is a bit tricky unless you know the perfect steps to analyze the higher time frame.
Let’s say, you have a perfect strategy that tells you the exact location to buy the asset. At times, you will notice the market is reacting to your trade setups after a few candles. This is because the strategy is not taking the momentum in the account. But if you analyze the angles of average indicator reading, you can take the trade at the right time.
A lime color bar should appear on the top of the zero lines of the indicator. The green bar usually appears after 4-5 candles once you have identified the potential buying signal. Though it will result in the use of wider stop loss, you can improve the accuracy of the trade. You get a higher win rate and this should significantly improve your confidence level.
But don’t consider the angle of the average bar as the Holy Grail in the Forex market. You will still have losing trades and there is nothing you can do. Some of you might not like the concept of wide stop loss and they can easily take the tweaked reading from the angles of the average indicator. We will teach this step in the short trade setups.
Angle of Averages Indicator For MT5 - Sell Entries
Taking trades in a strong downtrend is a very tough task. If you use the regular technique to take the reading from the angle of average, you are going to use a very wide stop loss. But in this segment, we will teach you to take the reading from this indicator in a different format.
After you find the potential selling level in the asset, you should be looking to take the trades at the grey bars. The grey bars must be formed at the negative side of the reference line. As you spot the grey bars, wait for three consecutive grey bars that gradually increase in its size. Open the short trade at the fourth grey bar of the angles of averages indicator.
The gradual increase in the length of the grey bar tells us the price is ready to participate in a strong downfall. Usually, you should find golden color bars on the negative side of the reference line after 5- 7 grey bars. When you use this tweak to take the reading, make sure you are only taking the trades with the trend.
You don’t have to use a wide stop loss since the trade will be taken right after the break of the support level. In case, the support is broken with a big bearish candle, you should wait for a minor bullish correction in the price. And it’s always better to wait for the golden bears so that you can open the trade at the end of a bullish correction.
Angle of Averages Indicator For MT5 - Conclusion
Integrating the Angle of Average to your existing trading system is a very straightforward process. Still, some of the rookies find it hard as they don’t know how the colored bars and the grey bars help them in the trading process.
They should analyze the price movement and evaluate the length and color of the bars in the angles of averages. Once you get to know the impact of the price on the bars of the indicators, the traders should be able to easily sync the new indicator to their existing trading method.
In case, the indicator is considered to trade in the reversal trading method, you should wait for two-colored bars before you open any trade. Let’s say, you want to trade in bullish reversal. Never open the trade at the first green bar rather wait for the second green bar to form.
Similarly, for the bearish reversal trading technique, you should be waiting for the second golden color bars. As a naïve trader, you should not start with the reversal trading technique first. Start with the trend trading strategy and conservatively use the indicator. As you gain experience, test the complex strategies with the reading of this classic indicator.