Trend
Bars is a VertexFX client side VTL indicator that identifies market cycles and
reversals in market trends. The indicator is built in a separate window in the
form of a histogram of red and green lines. The concept behind the Trend Bars
indicator is the methods that is used to calculate the Relative Strength Index
(RSI).
At
first step, we calculate the Relative Strength (RS). Then RS is calculated from
the sum of the difference in prices over the period where that difference is
positive (CU). Similarly, the sum of the difference in prices over the period
where that difference is negative (CD) is calculated expressed as a positive
number.
RSI
is calculated as 100 - 100 / (1 + CU/CD). The indicator comprises of two
colors- LIGHTGREEN and RED.
Light Green: When RSI(i) is more then 70 and more then 40
Red: When RSI(i) is less then 30 and less then 60
Trading
Signals:
Buy:
Place Buy position at close of candle when indicator color is Light Green.
Place stop loss below nearest swing low. Exit position if indicator color turns
RED, or alternatively keep a tight stop loss.
Sell:
Place Sell position at close of candle when indicator color is RED. Place stop
loss above nearest swing high. Exit position if indicator color turns LIGHT
GREEN, or alternatively keep a tight stop loss.
To
use Trend Bars indicator download it from here, then place it at VertexFX VTL
directory:
C:\ProgramData\VertexFX
Client Terminals\"Company name"\VTL10\Local VTL Scripts
Then
right click on the tree and select refresh or restart your client station and
you will find under VTL local scripts in
your client terminal.
You
can check this video that talks about Trend Bars indicator: