The Consolidation Indicator MT4 is, as the name suggests, a perfect tool for traders who trade consolidations as the forex market often spends time ranging. This indicator can help identify sideways movements, which are a way the market consolidates before resuming a trend. Consolidation periods can be an opportunity for price breakouts, making this forex indicator worth checking out.
Sounds interesting? Let’s take a closer look at it.
Introducing the Consolidation Indicator
MT4 Indicator Overview
The download link of the Consolidation MT4 indicator is placed at the bottom of this post. Once you’re done, your Metatrader 4 trading chart should look similar to the example below.
As previously mentioned, the forex market tends to spend most of its time in a range-bound or sideways movement. Trading within these consolidations can be challenging and requires strategic decision-making to take advantage of the right opportunities. Fortunately, there is an effective forex indicator available specifically designed for trading during consolidations.
The indicator has some similarities to the Ichimoku Kinko Hyo and incorporates MT4 Fibonacci levels to present channels. It is ideal for traders who frequently use Ichimoku Kinko Hyo and analyze the market through channels. Whether you are a novice or an advanced trader, you can apply the indicator to trade any currency pair.
How To Read The Consolidation Indicator?
The indicator is composed of eight lines which create four channels that are formed based on high and low prices. Each line uses Fibonacci values by default, but can be modified as needed. It aids in identifying the reversal point and the start of a new trend.
The indicator has four channels that vary in width and color. These are their characteristics:
- The tightest channel is called the silver channel.
- The sky channel is confined within sky blue colors, while the green line indicates the Zen channel.
- The future channel high is indicated by magenta colors.
Although the indicator does not provide a buy or sell signal, traders can interpret the lines to obtain signals, similar to the Ichimoku Kinko Hyo. The narrow channel can help traders identify the market trend, while the wide channel works as an ideal support and resistance level for price breakouts.
These are available settings to customize.
How to set up that MT4 indicator in your trading platform?
Download the consolidation-indicator-mt4.rar archive at the bottom of this post, unpack it, then copy and paste the consolidation-bands.ex4 or consolidation-bands.mq4 indicator files into the MQL4 folder of the Metatrader 4 trading platform.
You can gain access to this folder by clicking the top menu options, which goes as follows:
File > Open Data Folder > MQL4 > Indicators (paste here).
Now go to the left side of your MT4 terminal. In the Navigator find the gauge name, right-click it and select Attach to the chart.
If you want to be a successful trader, it’s crucial to learn how to trade in sideways and consolidating markets, as price action often ranges and consolidates more than it moves in clear trends. The MT4 Consolidation indicator is an excellent tool to help identify these markets and potential trades, so don’t miss out on opportunities by neglecting to learn how to trade them.
Download Free Forex Consolidation MT4 Indicator
To download the Consolidation Indicator for Metatrader 4 (MT4) for free just click the button below: