Kaufman3 Indicator
MT4 Trend TradingFree DownloadThe Kaufman3 Indicator for MT4 plotts two moving averages, but they differ from regular ones. By default they are pink and white and if you use a light background, it’s better to change white color to any other in order to make line visible. When it comes to their nature, they tend to provide less noise and clear short-term trend direction – thanks to adaptive formula.
Take a look an example chart below.
How to understand the Kaufman3 provided signals?
Esentially, the basic trading approach with of the Kaufman indicator is based on MAs crossovers, however it was designed to react to fluctuactions in quick and smart way. Therfore, please pay attention to an angle of both lines.
Flat trend
When they are close to each other and flat, it means there is currently a sideways ongoing market and it’s better to avoid trading during that time. This picture demonstrates described flat trend:
Clean trend
On the other hand, the good trigger is when there is significant distance betweeen the lines and their angle is steep. When candlesticks are positioned above both MAs, it corresponds to bullish scenario and forex traders should seek long opportunities. Conversely, when the bars are below them, it’s a perfect chance for short trades potential.
