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#1 Range-bound trading (50 SMA angle)

One of the methods to detect a range-bound market is by looking at the angle of the Moving average.
If, for example, our Moving average (MA) is rising fast - the angle of the MA line on the chart will get steeper and steeper.
Already at this early stage we can make a conclusion: if the angle of the Moving average is rising – the trend is getting stronger. If the angle is dropping – the trend is getting weaker.
If the angle of the moving average is insignificant, close to flat or is flat – we know that the market has entered its sideways mode.

Now lets have a look at 50 SMA (regardless the time frame) and its angle on the chart.
The direction in which moving average is going is not important. the angle at which it rises or falls is what interests us.

First of all, it is a visual guidance – when the Moving average lies horizontally, we know that the trend has paused or non-existent.

But, we don’t stop on just visual evaluation. There is already a tool to help us calculate the numbers/angles for better precision and further confirmation.

This is a custom MT4 indicator: MAAngle.mq4

MA angle in range-bound trading

It calculates the angle of the Moving average (MA) at any moment and displays it as a histogram. When MA goes completely flat – the indicator is yellow, other times it'll show whether MA is rising or falling and how fast it does so.
But that’s not all. You can change indicator settings, especially Angle Threshold to make histogram more (or less) sensitive to angle changes.

MA angle in range-bound trading

So, this will conclude our first method of detecting ranging markets.
I have many more ideas and methods to share. Stay tuned!

Truly yours,
Edward Revy

Nice one

James from Bondfx

Excellent work ! This work will help many traders. Thank you guys for sharing this work.

hi Edward, thks for the indicator but i just cant attached to the mt4 platform, pls advice

you'll find the guidelines here:
how to install custom indicators

Best regards,

||Eddy,Happy new year. Thanks for your hardwork and help.

Thanks you Edward..

....still reading but i'll like to say a million thanks already!!!

Helo Ed;

I just want to share how to detect Range or Trending Market, but unfortunately this
tehnique I just try & apply only in EUR/USD at H1 TimeFrame; please feel free to tweak.

Here's The Deal:

At EUR/USD Timeframe H1; try to put this 2 Indicators : ATR(14) & Standard Deviation(14)
Now here's the rules ...

If you find ATR(14) > then the Standar Deviation(14) it means EUR/USD = Ranging/Sideways.
If you find ATR(14) < then the Standar Deviation(14) it means EUR/USD = Trending.

The Logic behinds is; if the SD is smaller then the ATR it means Market in range of the 14 bars because ATR is meassure the range (high to low) of the N bars (in this case 14 bars); BUT if SD is more large then the ATR it means Market break the boundries of High to Low 14 Bars Range
& the result Market is Trending.

Please feel free for comment Bro Edward.

Happy Trading ;)

Best Regards;