LSMA in Color_v1
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This technical indicator is designed to provide visual guidance on market trends by calculating a weighted moving average of price data. Rather than simply averaging prices equally, the logic prioritizes more recent price action to determine the current momentum of the market.
Core Methodology
The script operates by analyzing a specific look-back period (the "Rperiod") of closing prices. Instead of a standard linear average, it applies a weighted calculation where the significance of each data point changes based on its position in time. By giving different "weights" to different candles within that period, the indicator reacts more dynamically to sudden shifts in price, attempting to smooth out minor market noise while remaining sensitive to significant trends.
Visual Logic and Color Coding
The tool communicates market direction through a three-color system (Yellow, Green, and Red) plotted directly on your chart. The logic determines which color to display by comparing the current calculated value against the previous one:
- Trend Identification: The script constantly monitors whether the weighted value is increasing or decreasing compared to the previous interval.
- Dynamic Coloring:
- When the calculation detects a specific direction of movement, it activates the corresponding color line (e.g., Green for one direction of movement and Red for another).
- When the trend reverses or remains neutral, the script "cleans" the previous segments by removing the opposite color.
- This results in a continuous, flowing line that changes color automatically as the market shifts from bullish to bearish momentum.
User Experience
For the trader, this logic translates to a streamlined visual experience. Instead of manually interpreting raw price fluctuations, you can observe the color of the indicator's line to gauge the current trend. The shifting colors serve as a real-time signal of where the market weight is moving—transitioning between colors as the underlying weighted momentum gains strength in one direction or the other.
//+------------------------------------------------------------------+
//| |
//| Copyright © 2004, MetaQuotes Software Corp. |
//| http://www.metaquotes.net/ |
//+------------------------------------------------------------------+
#property copyright "Copyright © 2005, FX Sniper "
#property link "http://www.metaquotes.net/"
//---- indicator settings
#property indicator_chart_window
#property indicator_buffers 3
#property indicator_color1 Yellow
#property indicator_color2 Green
#property indicator_color3 Red
//---- buffers
double ExtMapBuffer1[];
double ExtMapBuffer2[];
double ExtMapBuffer3[];
int width;
extern int Rperiod = 14;
extern int Draw4HowLongg = 1500;
int Draw4HowLong;
int shift;
int i;
int loopbegin;
double sum[];
int length;
double lengthvar;
double tmp ;
double wt[];
int c;
//+------------------------------------------------------------------+
//| Custom indicator initialization function |
//+------------------------------------------------------------------+
int init()
{
//---- 2 additional buffers are used for counting.
IndicatorBuffers(5);
//---- drawing settings
SetIndexBuffer(2,ExtMapBuffer1);
SetIndexBuffer(1,ExtMapBuffer2);
SetIndexBuffer(0,ExtMapBuffer3);
SetIndexBuffer(3,sum);
SetIndexBuffer(4,wt);
SetIndexStyle(2,DRAW_LINE,STYLE_SOLID,2);
SetIndexStyle(1,DRAW_LINE,STYLE_SOLID,2);
SetIndexStyle(0,DRAW_LINE,STYLE_SOLID,2);
//---- initialization done
return(0);
}
int start()
{ Draw4HowLong = Bars-Rperiod - 5;
length = Rperiod;
loopbegin = Draw4HowLong - length - 1;
for(shift = loopbegin; shift >= 0; shift--)
{
sum[1] = 0;
for(i = length; i >= 1 ; i--)
{
lengthvar = length + 1;
lengthvar /= 3;
tmp = 0;
tmp = ( i - lengthvar)*Close[length-i+shift];
sum[1]+=tmp;
}
wt[shift] = sum[1]*6/(length*(length+1));
//========== COLOR CODING ===========================================
ExtMapBuffer3[shift] = wt[shift]; //red
ExtMapBuffer2[shift] = wt[shift]; //green
ExtMapBuffer1[shift] = wt[shift]; //yellow
// for(c=loopbegin;c==shift;c++)
// {
if (wt[shift+1] > wt[shift])
{
ExtMapBuffer2[shift+1] = EMPTY_VALUE;
// ObjectCreate("smiley_face", OBJ_ARROW, 0, Time[shift], Low[shift]-Point*20);
// Print("time= ",Time[shift]);
// ObjectSet("smiley_face", OBJPROP_ARROWCODE, 242);
// ObjectSet("smiley_face", OBJPROP_COLOR , Red);
// ObjectSet("smiley_face", OBJPROP_WIDTH , 1);
// ObjectsRedraw();
//ExtMapBuffer3[shift+1] = EMPTY_VALUE;
//ExtMapBuffer3[shift+1] = EMPTY_VALUE;
}
else if (wt[shift+1] < wt[shift])
{
ExtMapBuffer1[shift+1] = EMPTY_VALUE; //-1 red/greem tight
//ExtMapBuffer3[shift+1] = EMPTY_VALUE;
}
else
{
ExtMapBuffer1[shift+1]=CLR_NONE;//EMPTY_VALUE;
ExtMapBuffer2[shift+1]=CLR_NONE;//EMPTY_VALUE;
}
}
return(0);
}
//+------------------------------------------------------------------+
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