MadroGoldenFilter
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This tool is a comprehensive technical analysis indicator designed to filter market noise and identify high-probability trading signals by synchronizing multiple mathematical models simultaneously. Rather than relying on a single price movement, it cross-references momentum, trend strength, and moving average intersections to provide a holistic view of market activity.
Core Logic Overview
The script functions as a multi-layered "filter." It analyzes the market through several distinct lenses to determine if a move is significant enough to be traded. The logic can be broken down into three primary categories:
1. Momentum and Trend Strength
The indicator constantly monitors the speed and power behind price movements using several diverse metrics:
- Momentum Analysis: It evaluates whether the current price velocity is above or below a standard benchmark to establish basic direction.
- Trend Confirmation: By combining the DeMarker (an oscillator that identifies trend changes) and the Force Index (which measures the strength of a move relative to volume), the script determines if the market is currently in a sustained upward or downward trend.
2. Multi-Factor Confluence (The "Cross" Signals)
To filter out "fakeouts" (false signals), the script requires three different indicators to agree before marking a crossover:
- Relative Strength Index (RSI): Ensures the price is in a favorable zone (above or below the 50 midpoint).
- MACD (Moving Average Convergence Divergence): Confirms that the average trend is shifting in the desired direction.
- ADX (Average Directional Index): Validates that there is sufficient directional strength to support the move.
Only when all three of these conditions are met simultaneously does the script identify a significant "Cross" signal.
3. Precision Entry Timing (Moving Average Crossovers)
The primary "trigger" for the tool is based on the interaction between two different Moving Averages (a fast and a slow average). The logic specifically looks for a confirmed "flip" in the relationship between these two averages:
- Bullish Signal: When the fast average moves from below the slow average to above it across three consecutive data points.
- Bearish Signal: When the fast average moves from above the slow average to below it across three consecutive data points.
User Experience & Alerts
To ensure these signals are actionable, the script includes an automated notification system. When a definitive Moving Average crossover occurs—the highest level of confirmation in this logic—the tool can trigger an immediate audio alert. This allows traders to react instantly to market shifts without needing to watch the charts constantly.
Summary of Visual Feedback
The indicator translates these complex calculations into visual markers on the chart:
- Directional Dots: Provide a constant sense of whether momentum is currently positive or negative.
- Trend Markers: Indicate the underlying health of the current market trend.
- Cross Signals: Highlight specific moments where multiple oscillators align for a potential entry.
- Primary Alerts: Identify the definitive "Golden" crossover points where the moving averages confirm a major shift in direction.
Indicators Used
Miscellaneous
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MadroGoldenFilter
//+------------------------------------------------------------------+
//| GoldenFilter_v1.mq4 |
//| Copyright © 2007, madro |
//| madrofx@yahoo.com |
//+------------------------------------------------------------------+
#property copyright "Copyright © 2007, madro"
#property link "madrofx@yahoo.com"
//----
#property indicator_separate_window
#property indicator_buffers 8
#property indicator_minimum 0
#property indicator_maximum 1
#property indicator_color1 RoyalBlue
#property indicator_color2 OrangeRed
#property indicator_color3 Goldenrod
#property indicator_color4 DarkGray
#property indicator_color5 Goldenrod
#property indicator_color6 DarkGray
#property indicator_color7 Goldenrod
#property indicator_color8 Gray
//----
extern int FasterMA = 5;
extern int SlowerMA = 15;
extern int MA1_Type = 1;
extern int MA2_Type = 1;
extern int MACD_Fast = 8;
extern int MACD_Slow = 17;
extern int MACD_Signal = 9;
extern int RSI = 21;
extern int Momentum = 14;
extern int DeMarker = 14;
extern int ADX = 14;
extern int ForceIndex = 14;
extern bool SoundAlert = true;
//---- indicator buffers
double Up[];
double Down[];
double CrossUp[];
double CrossDown[];
double TrendUp[];
double TrendDown[];
double MAUp[];
double MADown[];
//+------------------------------------------------------------------+
//| Custom indicator initialization function |
//+------------------------------------------------------------------+
int init()
{
//---- indicator line
SetIndexStyle(0, DRAW_ARROW);
SetIndexArrow(0,120);
SetIndexBuffer(0, Up);
SetIndexStyle(1, DRAW_ARROW);
SetIndexArrow(1,120);
SetIndexBuffer(1, Down);
SetIndexStyle(2, DRAW_ARROW);
SetIndexArrow(2, 251);
SetIndexBuffer(2, CrossUp);
SetIndexStyle(3, DRAW_ARROW);
SetIndexArrow(3, 251);
SetIndexBuffer(3, CrossDown);
SetIndexStyle(4, DRAW_ARROW);
SetIndexArrow(4, 110);
SetIndexBuffer(4, TrendUp);
SetIndexStyle(5, DRAW_ARROW);
SetIndexArrow(5, 110);
SetIndexBuffer(5, TrendDown);
SetIndexStyle(6, DRAW_ARROW,0,1);
SetIndexArrow(6, 241);
SetIndexBuffer(6, MAUp);
SetIndexStyle(7, DRAW_ARROW,0,1);
SetIndexArrow(7, 242);
SetIndexBuffer(7, MADown);
//---- name for DataWindow and indicator subwindow label
IndicatorShortName("madro-9");
return(0);
}
//+------------------------------------------------------------------+
//| |
//+------------------------------------------------------------------+
int deinit()
{
//----
return(0);
}
//+------------------------------------------------------------------+
//| GoldenFilter_v1 |
//+------------------------------------------------------------------+
int start()
{
int counted_bars = IndicatorCounted();
int i;
int limit;
//---- check for possible errors
if(counted_bars < 0)
return(-1);
//---- last counted bar will be recounted
if(counted_bars > 0)
counted_bars--;
limit = Bars - counted_bars;
//----
for(i = limit - 1; i >= 0; i--)
{
double fasterMAnow = iMA(NULL, 0, FasterMA, 0, MA1_Type,
PRICE_CLOSE, i);
double fasterMAprevious = iMA(NULL, 0, FasterMA, 0, MA1_Type,
PRICE_CLOSE, i + 1);
double fasterMAafter = iMA(NULL, 0, FasterMA, 0, MA1_Type,
PRICE_CLOSE, i - 1);
double slowerMAnow = iMA(NULL, 0, SlowerMA, 0, MA2_Type,
PRICE_CLOSE, i);
double slowerMAprevious = iMA(NULL, 0, SlowerMA, 0,
MA2_Type, PRICE_CLOSE, i + 1);
double slowerMAafter = iMA(NULL, 0, SlowerMA, 0, MA2_Type,
PRICE_CLOSE, i - 1);
//----
double MACD = iMACD(Symbol(), Period(), MACD_Fast, MACD_Slow,
MACD_Signal, PRICE_CLOSE, MODE_MAIN, i);
double MACD_Sig = iMACD(Symbol(), Period(), MACD_Fast, MACD_Slow,
MACD_Signal, PRICE_CLOSE, MODE_SIGNAL, i);
//----
double ADX1 = iADX(NULL, 0, ADX, PRICE_CLOSE, MODE_PLUSDI, i);
double ADX2 = iADX(NULL, 0, ADX, PRICE_CLOSE, MODE_MINUSDI, i);
//----
double RSIV = iRSI(NULL, 0, RSI, 0, i);
double DEM = iDeMarker(NULL, 0, DeMarker, i);
double MOM = iMomentum( NULL,0, Momentum, PRICE_CLOSE, i);
double FI = iForce(NULL, 0, ForceIndex, 1, PRICE_CLOSE, i);
if(MOM > 100)
Up[i] = 0.05;
if(MOM <= 100)
Down[i] = 0.05;
if(DEM > 0.5 && FI >0)
TrendUp[i] = 0.22;
if(DEM < 0.5 < 50 && FI < 0)
TrendDown[i] = 0.22;
if(RSIV > 50 && MACD > MACD_Sig && ADX1 > ADX2)
CrossUp[i] = 0.47;
if(RSIV < 50 && MACD < MACD_Sig && ADX1 < ADX2)
CrossDown[i] = 0.47;
if((fasterMAnow > slowerMAnow) &&
(fasterMAprevious < slowerMAprevious) &&
(fasterMAafter > slowerMAafter))
{
MAUp[i] = 0.8;
if(SoundAlert == true)
{
Alert("GoldenMadro Up " + Symbol() + " on the " +
Period() + " minute chart.");
}
}
if((fasterMAnow < (slowerMAnow)) &&
(fasterMAprevious > (slowerMAprevious)) &&
(fasterMAafter < slowerMAafter))
{
MADown[i] = 0.8;
if(SoundAlert == true)
Alert("GoldenMadro Up " + Symbol() + " on the " +
Period() + " minute chart.");
}
}
return(0);
}
//+------------------------------------------------------------------+
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