Indicators are intended to predict price moving, and traders actively use them to get more information in order to make decision on when to buy or sell an asset. The indicators help to avoid speculative price spikes during the analysis, determine peaks and troughs, filter unnecessary things, determine when a trend may be changed and much more.
If you focus on them, the number of loss trades made emotionally or due to incorrect forecasts will decrease substantively. Therefore, the indicators are the most important trader’s tools: trading without indicators as well as the unskilled use of them can lead to full investments' loss.
MetaTrader 4 provides the large number of Forex indicators, it'll be uneasy to master some of them, but it's necessary. After traders understand how each of indicators works and get practical skills, they usually select a few indicators for constant using — in average indicators. It's not enough to focus on the only one or two of them, because in this case market analysis won’t be complete, and as the result is the very low forecast accuracy.
You shouldn't focus on too many indicators at one time either — it will only prevent decisions making, because the conclusions from indicators data often contradict each other. Choose indicators the most suitable for you, and it's not necessary to be limited to the standard ones.
Although many indicators are available in MetaTrader 4, advanced users usually add other indicators to those provided by default. These can be either separately purchased advanced versions of standard indicators, which are more convenient to use, or specific ones that are not included in the basic set at all - but for someone they can be very useful.
There are the most popular groups of indicators, which can be used in Forex trading:
Bill Williams indicators;
volume indicators;
levels indicators;
trend indicators;
oscillators.
The attitude towards them among traders is ambiguous: some traders consider the indicators as useless ones, while others actively use them in trading. All tools from this group are based on chaos theory. The main ones are Alligator, Accelerator and Awesome Oscillator, and some others. There are the additional Forex indicators, for example, iFractals, which allows you to define the number of bars to calculate fractal dimensions, build a fractal channel and filter false breakouts.
With this indicator you can daily track the number of transactions in the market. More important than this indicator is the only currency rate. For example, if the rate hike was not accompanied by large volumes, it doesn’t matter. But if the volumes decrease when the rates rise, it may be a signal of a quick trend change. Special indicators are used for deep volume analysis. For instance, On Balance Volume, MACD and Volume.
The correct determination of the support and resistance levels is very important for successful Forex trading. In order to learn how to define them you need to master the level indicators. They are based on Fibonacci levels and easy to apply, so many traders start with these eunic-brussels.eur, they should be used only in combination with the indicators from other groups, and you can’t rely only on them. The most popular indicators are Fibo Box, FXR SR Zones, DailyGoOnGraph.
Trend indicators are the most popular ones, almost every trader use one or a few of them. With these indicators you can define how strong the current trend is and predict for how long it will last. The most popular indicators are Simple Moving Average, 3rd Generation, Exponential, Linear Weighted.
These indicators are used together with trend indicators. Unlike the latter, they are often ahead of the market. Oscillators help to define price impulse and the overbought/oversold on the market. Traders make a decision to enter or exit the trade based on the indicators data. The most popular oscillators are RSI and MACD, each of them has many variations.
In addition to these indicators, there are also many more. They can be grouped or individual and are often used in combination with others. Use time and money to find the suitable indicators, because the right indicator is the key for successful Forex trading.
Definition :
VPO is a Volume Price Opportunity. Instead of using bars or candles with an Open, High, Low, and Close price, each "bar" in a Market Profile is represented by horizontal bars against the price It is called Market Profile terminology.
In other words volume-price-opportunity (VPO) profiles are histograms of how many volumes were traded at each price within the span of the profile.
By using a VPO chart, you are able to analyze the amount of trading activity, based on volume, for each price level the market traded at for any given time period. The VPO Profile Chart study allows you to clearly see the areas where the market is trading with the max volumes.
The indicator can help determine Support-Resistance levels.
Inputs :
- On Chart Profile Options
- Enable/Disable
- Profile Display Mode : Lines/Solid/Gradient/Bars/OutLine
- Profile Alignment : Right/Left
- Profile Periods : Session/Daily/Weekly/Monthly
- Show Volume Text : Enable Text of Volumes
- Number of Price Steps : Number of horizontal divisions of profile
- VA Percentage : Percentage of Value Area
- Number of Profiles (Sessions)
- Session Start Time
- Session End Time
- On Side Profile Options
- Enable/Disable
- Profile Display Mode : Lines/Solid/Gradient/Bars/OutLine
- Profile Alignment : Right/Left
- Number of Days : Number of days included in profile calculation
- Number of Price Steps : Number of horizontal divisions of profile
- VA Percentage : Percentage of Value Area
- Profile Size (% of Chart Width)
- Visual Settings
- On Chart Profile Color
- On Chart Profile Back Color (for Gradient)
- On Chart Profile Draw VA
- On Chart Profile VA Color
- On Chart Profile Draw POC
- On Chart Profile POC Color
- On Chart Profile POC Thickness
- On Chart Profile Text Color
- On Chart Profile Text Font Size
- On Chart Profile Longitudinal Scale (%)
- On Side Profile Color
- On Side Profile Back Color (for Gradient)
- On Side Profile Draw VA
- On Side Profile VA Color
- On Side Profile Draw POC
- On Side Profile POC Color
- On Side Profile POC Thickness
Buffers for programmers :
Manual of using buffers.Tips :
Market Profile MetaTrader indicator — is a classic Market Profile implementation that can show the price density over time, outlining the most important price levels, value area, and control value of a given trading session. This indicator can be attached to timeframes between M1 and D1 and will show the Market Profile for daily, weekly, monthly, or even intraday sessions. Lower timeframes offer higher precision. Higher timeframes are recommended for better visibility. It is also possible to use a free-draw rectangle session to create a custom market profile on any timeframe. Six different color schemes are available to draw the profile's blocks. Drawing profiles as a plain color histogram is also possible. Alternatively, you may choose to color the profile based on bullish/bearish bars. This indicator is based on bare price action and does not use any standard indicators. It is available for MetaTrader 4, MetaTrader 5, and cTrader platforms.
A system of alerts is available for price crossing the levels of Value Area high and low, Median, and Single Print zones.
The chart screenshot shows market profiles calculated and displayed for two daily Forex trading sessions. The timeframe is M30 and the right-hand daily session is still in progress. The earliest prices are blue and the latest prices are red. The medians and the value areas are marked with the white lines and display the most important price areas. Traders tend to return to those areas if the volume of the breakout movement is not too high. High-volume breakout out of these areas signifies a real breakout. You can read more about Market Profile in this short e-book: Book on Market Profile.
The example below demonstrates how the Market Profile can be colored according to the direction of each bar in the session rather than its age. This is done when ColorBullBear is set to true.
This example demonstrates how the indicator can display a market profile based on the rectangle chart objects freely drawn by a trader. For this to work, a rectangle object's name has to start with MPR and the Session input parameter has to be set to Rectangle. You can press 'r' on your keyboard to add such a rectangle to the chart automatically.
Market Profile indicator can also draw histogram from right to left. Unlike the traditional left-to-right display, it can be helpful to focus on the current trading session, without obscuring its chart. You can see how this works on the chart screenshot below.
Market Profile indicator is also available as a free cTrader indicator. It is very similar to its MetaTrader siblings, but cannot work with push notification alerts.
MarketProfile indicator is being developed via a dedicated GitHub repository. You are encouraged to actively participate in the improvement of this indicator by submitting your own features via pull-requests and reviewing existing suggestions, changes, fixes, and so on.
Market Profile indicator is a powerful tool developed by a CBOT trader. Its original purpose was to graphically organize price and time information obtained during a trading session in a manner useful to traders. Today's Forex market is quite different from what commodity futures trading was back in when Peter Steidlmayer introduced his charting instrument to the public. Can Market Profile be a useful tool to Forex traders?
The main difference between today's currency market and the futures market of 80's is the lack of daily trading sessions. Fortunately, it does not produce any real problems. The lack of strict daily close and daily open can be compensated by one of the following methods:
Apparently, it is still possible to apply Market Profile to modern foreign exchange market. The most consistent approach seems to be the third one, which is based on weekly sessions.
Another important issue to solve when using this indicator in analysis is whether to apply it to the current session — and suffer from the lack of data during the early hours — or to the previous session, which could be based on stale data. In reality, this is no issue at all. As outlined in the CBOT's A Six-Part Guide to Market Profile, the most important profile is based on the current session, but the profile built during the previous one is also relevant and should be analyzed by a trader.
Moreover, it is possible (and useful) to look at several previous profiles at once, analyzing how the trend developed across more than one value area. The multi-session Market Profile analysis is also a key to detecting long-term areas of balance and states of imbalance. In fact, long-term traders should be looking at Market Profiles of many sessions to determine possible points of entry and exits.
The following example shows Market Profile calculated for six weekly sessions of the EUR/USD currency pair:
As the indicator's author stated, the Market Profile should not be used as a buy/sell signal generator. It is a tool for analyzing the market and getting information that isn't evident from a bare chart. Here is how the main parts of the Market Profile can be used in Forex trading:
Value area — the area of market acceptance. The price spent a hefty amount of time at those levels — the market likes it. The edges of the value area form strong support and resistance levels.
Median — the middle of the value area offers a strong pivot point. It serves both as the attractor for the price and as the bounce level. The median is also called a fair price. If market is below the level, it is considered undervalued. If it is above the median, it is overvalued.
Areas of low volume — the long tails below and above the value area show the price areas rejected by the market. The bottom tail is telling us of long-term buyers outperforming long-term sellers at those price levels. The top tail is telling us about the long-term sellers doing better than buyers at the respective price levels.
Even if you aren't a regular user of Market Profile indicator and your main trading strategy is based on a different concept or if your strategies are either automated with expert advisors or use fundamental indicators, you can still consult the long-term market profiles in times of doubt when lacking accurate information on where to put an entry order, take-profit, or stop-loss.
Do you have any suggestions or questions regarding this indicator? You can always discuss Market Profile with the other traders and MQL programmers on the indicators forums.
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