KAMA With Filter Indicator
MT5Also Available for MT4The KAMA indicator with a filter for MT5, which measures market volatility, determines the direction of the trend and reversal zones.
Description
The KAMA With Filter Indicator for MetaTrader 5 is a trend smoothing trading tool based on an optimized version of the exponential moving average (EMA). It is a mixture of EMA and adaptive moving average KAMA to improve the efficiency of market noise filtering and subsequent determination of the main trend direction.
What is KAMA’s Adaptive Moving Average?
The Kaufman Adaptive Moving Average, also known as KAMA, is simply a moving average based indicator that closely monitors price movement and interprets market volatility.
In addition, the indicator has been designed to respond less to minor fluctuations in the market, thereby generating fewer but better signals. This makes it effective for determining the direction of the trend and a potential price reversal zone.
This trend following indicator displays a bullish/bearish trend when the line moves up/down respectively. Conversely, this suggests a potential trend reversal when the line changes color. However, it is recommended to use signals in combination with price action/other technical indicators to confirm a buy/sell entry.
How to trade with the KAMA indicator with a filter
The image above shows the action of the indicator on the CHFJPY currency pair on the H1 timeframe. It illustrates how to identify a high-probability trade signal/entry using an indicator and price action.
The image shows a sell signal. First, it shows that the indicator line has changed its color from green to pink, which indicates a possible bearish move. Secondly, the price also dropped below the line, further indicating a bearish bq trend. Finally, price created a block of orders, retested it, and printed a bearish candle confirming a sell entry.
Conclusion
The KAMA indicator with a filter for MT5 is recommended for beginners, intermediate and advanced forex traders. Moreover, it is also suitable for scalpers, day/intraday and swing traders. Finally, it’s free to download.
1 2 3 4 5