Introduction to the MA Candles Two Colors Indicator
Identifying trend directions is probably one of the most basic skills that new traders should develop. This is because trading with the trend allows for higher accuracy.
Moving averages tend to be the most basic yet effective tool that traders can use to identify trend direction, and the MA Candles Two Colors indicator uses the concept of moving averages as a basis for identifying trend direction.
What is the MA Candles Two Colors Indicator?
The MA Candles Two Colors indicator is a trend following technical indicator which indicates momentum direction by changing the color of the candlestick bars. It causes the bars to change color only when the direction of the momentum has changed.
This indicator plots blue bars to indicate a bullish trend or momentum, and red bars to indicate a bearish trend or momentum.
How the MA Candles Two Colors Indicator Works?
The MA Candles Two Colors indicator uses an underlying moving average line to identify trend direction. It plots blue candles whenever the candles are above the underlying moving average line, and red candles whenever they are below the underlying moving average line. The color of the candles changes only when a candle closes on the opposite side of the moving average line.
How to use the MA Candles Two Color Indicator for MT4
Since the candle colors are based on an underlying moving average line, the options within the indicator’s settings pertain to its underlying moving average line. It allows traders to modify the period and type of moving average line. Traders can also choose the source of the price applied on the moving average line. It also allows traders to shift the moving average line forward or back.
Since the MA Candles Two Colors indicator is a trend following indicator, it can be used as a trend direction filter.
It can also be effectively used as a momentum reversal entry trigger, especially when it is in confluence with the long-term trend.
Buy Trade Setup
When to Enter?
Identify an uptrend market and wait for price to temporarily pullback causing the bars to temporarily change to red. Open a buy order as soon as the candles revert back to blue. Set the stop loss on the support below the entry candle.
When to Exit?
Close the trade as soon as the candles change to red or as price action shows signs of reversal.
Sell Trade Setup
When to Enter?
Identify a downtrend market and wait for price to temporarily pullback causing the bars to temporarily change to blue. Open a sell order as soon as the candles revert back to red. Set the stop loss on the resistance above the entry candle.
When to Exit?
Close the trade as soon as the candles change to blue or as price action shows signs of reversal.
Conclusion
The MA Candles Two Colors indicator is a very effective trend following indicator. It can provide excellent signals especially when used in confluence with a long-term trend. However, it tends to be ineffective when used in a choppy or ranging market. As such, it is important to use this indicator only in the context of a trending market condition.
MT4 Indicators – Download Instructions
MA Candles Two Colors Indicator for MT4 is a Metatrader 4 (MT4) indicator and the essence of this technical indicator is to transform the accumulated history data.
MA Candles Two Colors Indicator for MT4 provides for an opportunity to detect various peculiarities and patterns in price dynamics which are invisible to the naked eye.
Based on this information, traders can assume further price movement and adjust their strategy accordingly.
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How to install MA Candles Two Colors Indicator for MT4.mq4?
- Download MA Candles Two Colors Indicator for MT4.mq4
- Copy MA Candles Two Colors Indicator for MT4.mq4 to your Metatrader Directory / experts / indicators /
- Start or restart your Metatrader 4 Client
- Select Chart and Timeframe where you want to test your MT4 indicators
- Search “Custom Indicators” in your Navigator mostly left in your Metatrader 4 Client
- Right click on MA Candles Two Colors Indicator for MT4.mq4
- Attach to a chart
- Modify settings or press ok
- Indicator MA Candles Two Colors Indicator for MT4.mq4 is available on your Chart
How to remove MA Candles Two Colors Indicator for MT4.mq4 from your Metatrader Chart?
- Select the Chart where is the Indicator running in your Metatrader 4 Client
- Right click into the Chart
- “Indicators list”
- Select the Indicator and delete
MA Candles Two Colors Indicator for MT4 (Free Download)
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