Balance of Market Power Indicator
MT5Also Available for MT4Maximize your trading potential with the Balance of Market Power Indicator for MT5. This powerful tool assesses the strength of buyers and sellers in the market, making it an essential resource for scalpers, day traders, and swing traders. Take your technical analysis game to the next level!
Description
Introducing the Balance of Market Power Indicator, an exceptional technical trading tool that accurately analyzes the strength of buy/sell pressure between bulls and bears in the market. By assessing the buying/selling power of bulls or bears, this indicator possesses remarkable potential to catapult the price of an asset to unmatched levels.
The Balance of Market Power Indicator applies to the value derived from the close price, subtracting the open/high price as well as the low price. Its default 14 period moving average fluxes between positive and negative extreme levels. As a result, the indicator is highly effective in identifying overbought/oversold levels and predicting trend continuation/reversal.
Moreover, the market’s inclination towards trending is determined by the zero line of the indicator. Light yellow histogram bars appearing above this line indicate stronger bullish power. On the other hand, red histogram bars below the zero line signify stronger bearish power. The Balance of Market Power Indicator for MetaTrader is a potent tool that helps traders make informed decisions in their trading endeavors.
How to Trade With the Balance of Market Power Indicator
So, look at this GBPUSD currency pair on the H1 timeframe chart. It provides a clear demonstration of how price action and the Balance of Market Power (BMP) Indicator can be combined to create a high probability entry.
The lime histogram bars on the BMP indicated a buy signal above the zero-line level. While a bullish engulfing candlestick pattern confirmed the entry. On the other hand, the sell signal was triggered by the trend’s downward movement and the indicator’s red bar below the zero level. It is coincided with a bearish engulfing candlestick pattern.
Conclusion
The BMP Indicator is a useful technical trading tool that effectively evaluates the strength of buyers and sellers in the market. It can benefit scalpers, day-trade and swing traders in making sound technical analysis. Best of all, it’s available for free download.
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