KAMARev2
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This script functions as a technical analysis tool designed to provide traders with a smoothed visual representation of price movement, while simultaneously identifying momentum and specific price thresholds. Instead of following every minor fluctuation in the market (noise), the logic aims to highlight the underlying trend by balancing price speed and volatility.
Core Logic Breakdown
Trend Smoothing & Adaptation The primary engine of this tool calculates a modified moving average. It does this by evaluating two main factors:
- Direction: The script looks at the change in price over a specific period to determine where the market is heading.
- Volatility: It measures the total range of price movement (the "swing") during that same period.
By comparing the direction against the volatility, the tool calculates an efficiency ratio. This allows the indicator to adapt: when the market moves strongly and smoothly, the line follows closely; when the market becomes choppy or erratic, the line reacts less aggressively, providing a cleaner view of the trend.
Momentum Tracking Beyond simply showing a trend line, the script monitors the "velocity" of the price action. It calculates the difference between the current smoothed value and its value from several periods ago. This helps in visualizing whether the trend is accelerating, slowing down, or potentially reversing.
Visual Thresholds The script also generates specific horizontal reference levels. These are used as fixed boundaries to help traders identify significant "zones." By plotting these constants alongside the moving lines, the tool allows for a quicker visual assessment of whether the current price action is expanding beyond established limits.
Summary for the User
Essentially, this tool acts as a sophisticated "filter" for market data. It takes raw, messy price movements and converts them into four distinct visual components:
- A primary trend line that adjusts its sensitivity based on market volatility.
- A momentum indicator that tracks how fast the trend is moving.
- Two fixed reference levels that act as markers for significant price targets or boundaries.
//+------------------------------------------------------------------+
//| KAMARev.mq4 |
//| Copyright ?2005, MetaQuotes Software Corp. |
//| http://www.metaquotes.net |
//+------------------------------------------------------------------+
#property copyright "Copyright ?2005, MetaQuotes Software Corp."
#property link "http://www.metaquotes.net"
#property indicator_separate_window
#property indicator_buffers 4
#property indicator_color1 Black
#property indicator_color2 Yellow
#property indicator_color3 Red
#property indicator_color4 Red
//---- input parameters
extern int KAMAPeriod=4;
extern int LookBack=3;
extern double RevPoint=0.0004;
//---- buffers
double ExtMapBuffer1[];
double ExtMapBuffer2[];
double ExtMapBuffer3[];
double ExtMapBuffer4[];
//+------------------------------------------------------------------+
//| Custom indicator initialization function |
//+------------------------------------------------------------------+
int init()
{ string short_name;
//---- indicators
SetIndexStyle(0,DRAW_LINE);
SetIndexBuffer(0, ExtMapBuffer1);
SetIndexStyle(1,DRAW_LINE);
SetIndexBuffer(1, ExtMapBuffer2);
SetIndexStyle(2,DRAW_LINE);
SetIndexBuffer(2, ExtMapBuffer3);
SetIndexStyle(3,DRAW_LINE);
SetIndexBuffer(3, ExtMapBuffer4);
short_name="KAMA("+KAMAPeriod+","+LookBack+","+RevPoint+")";
IndicatorShortName(short_name);
SetIndexLabel(0,short_name);
//----
return(0);
}
//+------------------------------------------------------------------+
//| Custor indicator deinitialization function |
//+------------------------------------------------------------------+
int deinit()
{
//---- TODO: add your code here
//----
return(0);
}
//+------------------------------------------------------------------+
//| Custom indicator iteration function |
//+------------------------------------------------------------------+
int start()
{
int Scale=500;
int i,counted_bars=IndicatorCounted();
double tmp[];
double rel,negative,positive;
if(Bars<=KAMAPeriod) return(0);
//---- initial zero
if(counted_bars<1)
for(i=1;i<=KAMAPeriod;i++) ExtMapBuffer1[Bars-i]=0.0;
if(counted_bars>=KAMAPeriod) i=Bars-counted_bars-1;
if(counted_bars<0) return(-1);
int limit=Bars-counted_bars;
//---- TODO: add your code here
// double FastSC = (double)(2.0/(2.0 + 1.0));
// double SlowSC = (double)(2.0/(30.0 + 1.0));
double FastSC = (2.0/(2.0 + 1.0));
double SlowSC = (2.0/(30.0 + 1.0));
double Direction=0;
double Volatility=0;
double ER=0;
double SSC=0;
double Constant=0;
int start=counted_bars-1;
int handle;
start=0;
limit=Bars;
for(i=start+limit; i>=start; i--){
Direction=Close[i]-Close[i+KAMAPeriod];
double sum=0;
for(int j=i+KAMAPeriod-1;(j>=i);j--){
sum+=MathAbs(Close[j]-Close[j+1]);
}
Volatility=sum;
if (Volatility==0) ER=0;
else
ER=MathAbs(Direction/Volatility);
SSC= ER * (FastSC - SlowSC) + SlowSC;
Constant=SSC*SSC;
if (i<KAMAPeriod)
ExtMapBuffer1[i]=Close[i+1]+Constant*(Close[i]-Close[i+1]);
else
ExtMapBuffer1[i]=ExtMapBuffer1[i+1]+Constant*(Close[i]-ExtMapBuffer1[i+1]);
// ExtMapBuffer1[i]=ExtMapBuffer2[i]-ExtMapBuffer2[i+LookBack];
double tmpd=ExtMapBuffer1[i]-ExtMapBuffer1[i+LookBack];
ExtMapBuffer2[i]=tmpd*Scale;
ExtMapBuffer3[i]=RevPoint*Scale;
ExtMapBuffer4[i]=-1*RevPoint*Scale;
}
//----
// FileClose(handle);
return(0);
}
//+------------------------------------------------------------------+
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