Custom Indicators
Build's on the basis of the following formulas:
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Alligator Indicator
This technical indicator contains of three
lines, which are Moving Averages with different
parameters. The first line (the chap of
alligator) - is a line of balance to the
significative time period, which is used
for building of the chart (13 period smoothed
moving average, shifted on 8 bars to the
future.) The Red line (the teeth of alligator)
- is the line of balance for the significative
time period, which is one step less (8 period
smoothed moving average, shifted on 5 bars
to the future); The Green line (the lips
of alligator) - is the line of balance for
the significative time period, which is
one more step less (5 period smoothed moving
average, shifted on 3 bars to the future).
Interpretation: when all lines are jolloped,
the Alligator sleeps, and as long as it
sleeps as hungry it is. When it awakes after
long rest, it is very hungry and starts
hunting for the price, (the food of the
Alligator), till it is gorged. When the
Alligator is gorged, it looses interest
to food (price) - the balance lines are
convergent. This is the moment of fixing
the profit. You shoul close all positions
and wait untill Alligator awakes again.
Build's on the basis of the following formulas:
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Gator Indicator
Build's on the basis of the following formulas:
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Bollinger Indicator
Indicator of Bollinger borders is represented
by two lines, which are built on the distance
equal to certain amount of standard deviations.
Since the value of standard deviation depends
on volatilessness of the price, the lines
controls their width automatically. The
width increasing when the market is more
vilatile and decreasing when the market
is less volatile. Build's on the basis of
the following formulas:
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Bollinger Bands
Indicator of Bollinger borders is represented
by two lines, which are built on the distance
equal to certain amount of standard deviations.
Since the value of standard deviation depends
on volatilessness of the price, the lines
controls their width automatically. The
width increasing when the market is more
vilatile and decreasing when the market
is less volatile. Build's on the basis of
the following formulas:
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Envelope Indicator
The technical indicator Envelopes of Moving
Averages is two envelope lines, which is
created by two moving averages. The first
MA is shifted above, the other one is shifted
below. The choice ov the optimal relative
value of shifting of the borders of the
band is defined by the user and depends
on the volatilesness of the market: the
shifting is as large as the market is volatile.
The envelope lines define the upper and
downfloor borders of normal range of price's
swinging. Build's on the basis of the following
formulas:
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IKH Indicator
Ichimoku Kinko Hyo as a rule is used for
definition of a market trend, levels of
support and resistance and for generation
of signals of purchase and sale. In the
best way the indicator works on week and
day time charts. Four time intervals of
various extent are used when the parameters
are set. Build's on the basis of the following
formulas:
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Ichimoku Kinko Hyo Indicator
Ichimoku Kinko Hyo as a rule is used for
definition of a market trend, levels of
support and resistance and for generation
of signals of purchase and sale. In the
best way the indicator works on week and
day time charts. Four time intervals of
various extent are used when the parameters
are set. Build's on the basis of the following
formulas:
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Kelter Channel Indicator
Keltner Channel - is an indicator of volatilessness,
which is based on calculation of maximal
and minimal prices in periods and the theory
of the most probable hit of the prices in
some borders. If the line of the price crosses
the border, it may be the signal to make
trade operation. When the bottom line is
crossed, the buy operation sholud be performed,
the sell operation is performed when the
line of price crosses the upper border.
Build's on the basis of the following formulas:
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Linear Regression Indicator
LRI Indicator is built on a price trend
with the set period. For definition of a
trend, the linear regress is calculated
on a method of the least squares. The method
of the least squares allows building of
a line of a trend so, that the root-mean-square
deviation (on axis Y) of its points from
points of the chart of the price n is minimized
in the set period. Build's on the basis
of the following formulas:
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Moving Average Indicator
This is the most frequently used technical
indicator. Herein the MA can be used both
separately and in combination with other
MA indicators. This indicator is used as
signal tool for entering and exit the market,
and to filter the signals, given by the
other indicators. Build's on the basis of
the following formulas:
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Adaptive Moving Average Indicator
The Adaptive Moving Average changes slowly
when the price is in the side trend, and
changes quickly, when the prices move in
the ascending or descending trend. The main
interpretation of AMA - to buy when AMA
is moving up and sell when AMA is moving
down. Build's on the basis of the following
formulas:
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Price Channel Indicator
The Price Channel is represented by two
lines. The building of the price channel
is based on calculation of maximal and minimal
prices for the certaing amount of periods.
The lines of the price channel is built
on the basis of the following formulas:
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Parabolic SAR Indicator
The Parabolic SAR (Stop and Reverse) is
a system of defining the point of trend's
turns; The main tasks of the Parabolic System
is to make reverse orientation of trading
positions when the current trend turns.
The Paramolic SAR system should be used
only when the market has the defined trend.
When the trend is absent this system generates
a lot of incorrect signals. Parabolic SAR
is base on the following rule: to shift
the levels of closing prices only in direction
of opened position. If there is a long position
opened before, it is possible to increase
the level of closing prices, but not to
decrease it. If the short position is opened,
it is possible to decrease the level of
closing prices. Build's on the basis of
the following formulas:
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ADX (Average Direction Movement Index) Indicator
ADX - is a DX, smoothed by the exponential
moving average for the n periods. Build's
on the basis of the following formulas:
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Aroon Indicator
Aroon Indicator allows defining the changing
in prices from the trend state of the market
to the sidewalks state. (It indicates absence
of clear tendency). This indicator is built
on the basis of measurement of amount of
periods, which has passed from the moment
of Maximum and minimum within the time range
of n periods.Build's on the basis of the
following formulas:
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Average true range Indicator
The Indicator of true range is calculated
as a Moving Average of TR within set amount
of periods. Build's on the basis of the
following formulas:
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Commodity Channel Index Indicator
Commodity Channel Index is an Indicator
of price momentum. If the value of cci falls
outside the limits of range [-100% ...+100%],
it means that prices follows the trend.
Build's on the basis of the following formulas:
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Chandle momentum oscillator Indicator
The common method of interpretation of CMO
is searching of overbuying/overselling.
Overbuying appear when the value is more
than +50, othewise overselling appear in
case of value is less than -5. These levels
are conformable to the level of 70/30 of
RSI Indicator. Build's on the basis of the
following formulas:
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Moving Average Convergence Divergence Indicator
MACD - is the most famous indicator, which
is built on the basis of difference of the
average values. (The Figure # 19). This
indicator was suggested by Jerald H. Appler
as the difference between two exponentially
smoothed averages (EMA). Build's on the
basis of the following formulas:
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Momentum Indicator
Momentum is the most frequent usable indicator.
This indicator measures the velocity of
changin of prices. Build's on the basis
of the following formulas:
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Price Oscillator Indicator
The PO Indicator is a difference between
the moving averages, built on the basis
of two periods. Build's on the basis of
the following formulas:
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Quick Stick Indicator
The QStick Indicator is a simple n-periodic
moving average for the difference of the
opening and closing prices. Build's on the
basis of the following formulas:
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Rate Of Change Indicator
The ROC (Rate of Change) Indicator is a
difference between the price of the current
period and the price of the previous period,
which is located n periods back from the
current one. Build's on the basis of the
following formulas:
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Relative Strength Index Indicator
The RSI Indicator is a indicator of speed
of changing of price. Build's on the basis
of the following formulas:
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Stochastic Indicator
The Stochastic Oscillator shows the moments,
when the price reaches the border of its
trade diapason within predefined period
of time (this is an indicator of speed of
changing or the Impulse of Price). Build's
on the basis of the following formulas:
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Positive Volume Index Indicator
Index of positive volume indicator (PVI)
changes on the periods in which value of
volume has increased in comparison with
the previous period. In connection with
that the rise in prices is connected to
increase in volumes, PVI will usually change
in a direction of ascending trend. Build's
on the basis of the following formulas:
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Forex Glossary
Ask: Price at which broker/dealer is willing
to sell. Same as Offer. For example, if
EUR/USD is quoted at 1.1850/1.1854, the
1.1854 is the Ask or Offered price. Bid:
Price at which broker/dealer is willing
to buy. For example, if EUR/USD is quoted
at 1.1850/1.1854, the 1.1850 is the Bid
price. Bid/Ask Spread (or Spread): The distance,
usually in pips, between the Bid and Ask
price. A tighter spread is better for the
trader. Cost of Carry (also Interest or
Premium): The cost, often quoted in terms
of dollars or pips per day, of holding an
open position. Currency Futures: Futures
contracts traded on an exchange, most typically
the Chicago Mercantile Exchange (CME). Always
quoted in terms of the currency value with
respect to the US Dollar. Parameters of
the futures contract are standardized by
the exchange. Drawdown: The magnitude of
a decline in account value, either in percentage
or dollar terms, as measured from peak to
subsequent trough. For example, if a trader's
account increased in value from $10,000
to $20,000, then dropped to $15,000, then
increased again to $25,000, that trader
would have had a maximum drawdown of $5,000
(incurred when the account declined from
$20,000 to $15,000) even though that traders
account was never in a loss position from
inception. EBS: Electronic Brokerage System,
the electronic system on which major banks
trade with each other. This is considered
to be the most definitive indicator of prices
at which currencies are really trading,
at least for EUR/USD and USD/JPY. Fundamental
Analysis: Macro or strategic assessments
of where a currency should be trading based
on any criteria but the price action itself.
These criteria often include the economic
condition of the country that the currency
represents, monetary policy, and other fundamental
elements. Leverage: The relationship between
the notional contract value and the margin
required to trade. For example, if the notional
amount traded (also referred to as lot size
or contract value) is $100,000 dollars and
the required margin is $2,000, the trader
can trade with 50 times leverage ($100,000/$2,000);
or 50:1 leverage. Leverage is the inverse
of the percentage margin requirement. Limit:
An order to buy at a specified price when
the market moves down to that price, or
to sell at a specified price when the market
moves up to that price. Liquidity: A function
of volume and activity in a market. It is
the efficiency and cost effectiveness with
which positions can be traded and orders
executed. A more liquid market will provide
more frequent price quotes at a smaller
bid/ask spread. Long: A market position
that has been bought. It will generate profits
as the market moves up and losses as the
market moves down. For example, if you bought
Euros, you will be long Euros. Margin: The
amount of funds required in a clients account
in order to open a position or to maintain
an open position. The percentage of the
contract value required as margin is inversely
related to the leverage. Margin Call: A
requirement by the broker to deposit more
funds in order to maintain an open position.
Market Order: An order to buy at the current
Ask price. Offer: Price at which broker/dealer
is willing to sell. Same as Ask. Pip: The
smallest price increment in a currency.
Often referred to as ticks in the futures
markets. For example, in EURUSD, a move
from .9015 to .9016 is one pip. In USDJPY,
a move from 128.51 to 128.52 is one pip.
Premium (also Interest or Cost of Carry
or Roll): The cost, often quoted in terms
of dollars or pips per day, of holding an
open position. Short: A market position
that has been sold. It will generate losses
as the market moves up and profits as the
market moves down. For example, if you sold
Euros, you will be short Euros. Spot Foreign
Exchange: Often referred to as the interbank
market. Refers to currencies traded between
two counterparties for spot or current delivery
rather than future delivery. Generally more
liquid and widely traded than currency futures,
particularly by institutions and professional
money managers. Stop: An order to buy at
the market only when the market moves up
to a specific price, or to sell at the market
only when the market moves down to a specific
price. For example, if EUR/USD is trading
at around 1.1850, you could place a stop
order to buy at 1.1870. This order would
be filled only if the market moved up to
1.1870 or higher. Technical Analysis: Analysis
applied to the price action of the market
to develop trading decisions, irrespective
of fundamental factors.
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