Opening a trade at the very beginning of an emerging trend allows you not only to make money, but to get a good profit. But the point is, identifying trends is not an easy task. Its solution can be facilitated using the indicator, which I will tell you about today. The ZWinnerColorSignals algorithm is based on moving averages. They have long been used by traders in market analysis. But MA has a significant drawback – lag. The creators of the indicator, which is discussed in the article, took care of eliminating the lag and maximizing the quality of signals. And, judging by trade statistics, they succeeded.
Identifying trends with this indicator is available even for market beginners.
The indicator is presented in two versions: as a curve on the chart and as dots in a separate window. Which one to use is up to you.
Installation in MT4 is carried out according to the usual scheme.
Trading using the ZWinnerColorSignals indicator
On the chart, the indicator looks like this
As you might guess, the signal to enter the market is a change in the color of the curve or points. Red indicates a downtrend, while blue or green indicates an uptrend. Accordingly, in the first case – we buy, in the second – we sell. It’s that simple.
The indicator readings can also be used to close orders. This is done when a return signal appears. It is recommended to place stop orders at the nearest extreme. When the appropriate opportunity arises, they must be transferred to breakeven.
Now let’s talk about the settings.
Since the indicator is presented in two versions, the parameters for each of them will be different.
There are 4 parameters in the settings of the indicator displaying lines on the chart.
First of all, you need to specify the MA period – the Period parameter, also its type –
Method and price type – Price. The last parameter is Time-Frame. Here we register the timeframe, which the indicator should use in its calculations.
The second version of the indicator has 3 parameters.
Gi-76 is the period of the moving average.
Wing-Ding-Up and Wing-Ding-Down – these parameters relate to the type of icons, that is, they do not matter for trading.
Timely identification of trends is possible using the ZWinnerColorSignals indicator. Try doing this first on a demo account. After successfully testing the indicator’s operation, you can include it in your working trading strategy.