RainbowOsMA_v1
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This technical tool is designed to provide visual momentum analysis by combining multiple moving average calculations into a single, color-coded oscillator. Instead of looking at raw price action, it focuses on the relationship between different speeds of market movement to highlight trends and potential turning points.
Core Logic Breakdown
1. Momentum Calculation The script begins by calculating two different types of Exponential Moving Averages (EMAs) based on the user-defined "Fast" and "Slow" periods. By subtracting the slow average from the fast average, the tool creates a baseline momentum value. This helps identify whether the current price trend is accelerating or decelerating compared to its recent history.
2. Signal Smoothing To filter out minor market noise and prevent erratic visual jumps, the script applies a third calculation—a Simple Moving Average (SMA)—specifically to the momentum value generated in the first step. This creates a "Signal Line," which acts as a smoother guide for the primary momentum.
3. The "Rainbow" Visual Logic The most distinctive feature of this tool is how it handles the final output. It measures the distance between the primary momentum and the smoothed signal line. Based on this distance, the script categorizes the data into four distinct visual zones:
- Strong Positive Momentum: When the momentum is significantly above the signal line, it is highlighted with one specific color.
- Weak Positive Momentum: If the momentum is above the signal line but falls within a very narrow "threshold" (a tiny margin of movement), it shifts to a different color. This helps traders distinguish between a meaningful trend and a stagnant period.
- Strong Negative Momentum: When the momentum falls significantly below the signal line, it uses a third distinct color.
- Weak Negative Momentum: Similar to the positive side, if the momentum is below the signal line but stays within that narrow threshold, it uses a fourth color.
Summary for the User
By using this logic, the tool transforms complex mathematical averages into a clear, multi-colored histogram. Rather than just showing you "up" or "down," it differentiates between "strong" and "weak" movements. This allows you to see at a glance whether a trend has significant strength behind it or if it is losing steam, potentially providing an earlier warning of a trend reversal or exhaustion.
/*-----------------------------+
| |
| Shared by www.Aptrafx.com |
| |
+------------------------------*/
//+------------------------------------------------------------------+
//| OsMA.mq4 |
//| Copyright © 2004, MetaQuotes Software Corp. |
//| http://www.metaquotes.net/ |
//+------------------------------------------------------------------+
#property copyright "colour update by thor@gmx.co.uk, Moneytec chat: thorr"
//---- indicator settings
#property indicator_separate_window
#property indicator_buffers 4
#property indicator_color1 Maroon
#property indicator_color2 DarkGreen
#property indicator_color3 Lime
#property indicator_color4 OrangeRed
//---- indicator parameters
extern int FastEMA=8;
extern int SlowEMA=12;
extern int SignalSMA=9;
extern double thresh = 0.0001;
//---- indicator buffers
double ind_buffer0[];
double ind_buffer1[];
double ind_buffer2[];
double ind_buffer3[];
double ind_brighthi[];
double ind_brightlo[];
double res;
//+------------------------------------------------------------------+
//| Custom indicator initialization function |
//+------------------------------------------------------------------+
int init()
{
//---- 2 additional buffers are used for counting.
IndicatorBuffers(6);
//---- drawing settings
SetIndexStyle(0,DRAW_HISTOGRAM,STYLE_SOLID,2);
SetIndexStyle(1,DRAW_HISTOGRAM,STYLE_SOLID,2);
SetIndexStyle(2,DRAW_HISTOGRAM,STYLE_SOLID,2);
SetIndexStyle(3,DRAW_HISTOGRAM,STYLE_SOLID,2);
SetIndexDrawBegin(0,SignalSMA);
SetIndexDrawBegin(1,SignalSMA);
SetIndexDrawBegin(2,SignalSMA);
SetIndexDrawBegin(3,SignalSMA);
IndicatorDigits(MarketInfo(Symbol(),MODE_DIGITS)+2);
//---- 4 indicator buffers mapping
if(!SetIndexBuffer(0,ind_buffer0) &&
!SetIndexBuffer(1,ind_buffer1) &&
!SetIndexBuffer(2,ind_brighthi) &&
!SetIndexBuffer(3,ind_brightlo) &&
!SetIndexBuffer(4,ind_buffer2) &&
!SetIndexBuffer(5,ind_buffer3))
Print("cannot set indicator buffers!");
//---- name for DataWindow and indicator subwindow label
IndicatorShortName("RainbowOsMA("+FastEMA+","+SlowEMA+","+SignalSMA+")");
//---- initialization done
return(0);
}
//+------------------------------------------------------------------+
//| Moving Average of Oscillator |
//+------------------------------------------------------------------+
int start()
{
int limit;
int counted_bars=IndicatorCounted();
//---- 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;
//---- macd counted in the 1-st additional buffer
for(int i=0; i<limit; i++)
ind_buffer3[i]=iMA(NULL,0,FastEMA,0,MODE_EMA,PRICE_CLOSE,i)-iMA(NULL,0,SlowEMA,0,MODE_EMA,PRICE_CLOSE,i);
//---- signal line counted in the 2-nd additional buffer
for(i=0; i<limit; i++)
ind_buffer2[i]=iMAOnArray(ind_buffer3,Bars,SignalSMA,0,MODE_SMA,i);
//---- main loop
for(i=limit-1; i>=0; i--)
{
res = ind_buffer3[i] - ind_buffer2[i];
// Sort it out now...
if (res < thresh && res > 0) {
ind_buffer1[i] = res;
ind_brighthi[i] = 0;
continue;
} else if (res > 0) {
ind_brighthi[i] = res;
ind_buffer1[i] = 0;
} else if (res > -thresh && res < 0) {
ind_brightlo[i] = 0;
ind_buffer0[i] = res;
continue;
} else if (res < 0)
ind_brightlo[i] = res;
ind_buffer0[i] = 0;
}
return(0);
}
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