The Absolute Strength Metatrader 5 Forex indicator can be considered an alternative to the renowned RSI, Stochastic and DMI indicators, considering their methods of calculation which is built on Buyers and Sellers strengths.
Irrespective of the listed technical indicators, the Absolute Strength indicator performs its calculation in points, not in percentage.
The indicator has four lines that hover within a dedicated window i.e. a deep sky blue or bulls line, a tomato or bears line, and two dotted slate gray lines (that depicts strength and weakness).
When the deep sky blue line crosses above the slate gray line, price is said to be overbought, while it is oversold when the tomato line crosses below the slate gray line.
The EUR/USD H4 chart below displays the Absolute Strength Metatrader 5 forex indicator in action.
Basic Trading Signals
Buy Signal: Go long when the deep sky blue line of the Absolute Strength Metatrader 5 forex indicator intersects the tomato line to stay above.
Sell Signal: Go short when the tomato line of the Absolute Strength Metatrader 5 forex indicator crosses the deep sky blue line to stay above.
Exit buy signal: Close all buy orders if while a bullish trend is ongoing, the deep sky blue line of the Absolute Strength indicator dips below the tomato line.
Exit sell signal: Close all sell orders if while a bearish trend is running, the tomato line of the Absolute Strength indicator dips below the deep sky blue line.
Tips: The Absolute Strength indicator gives traders the opportunity to better understand finer-grained market strengths and check sufficient drawbacks such as slippage during strong market trends.
The indicator works for scalping, day trading and swing trading purposes.
MT5 Indicator Characteristics
Currency pairs: Any
Platform: Metatrader 5
Type: chart window indicator
Customization options: Variable [TimeFrame, Math method, Apply to, Period of Evaluation=24, Period of PreSmoothing=2, Period of Smoothing, Period of Signal Line, Moving Average Mode, LevelsMode, Strength Level (ex. 70), Weakness Level (ex. 30), LookBack Period for LevelsMode=2, 3, Upper Band Multiplier for LevelsMode=2, Lower Band Multiplier for LevelsMode=2], width & Style.
Time frames: 1-Minute, 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours, 1-Day, 1-Week, 1-Month
Type: oscillator | overbought/oversold
Copy and paste the absolutestrength_v2.ex5 indicator into the MQL5 indicators folder of the Metatrader 5 trading platform.
You can access this folder from the top menu as follows:
File > Open Data Folder > MQL5 > Indicators (paste here)