Pain Indicator for MT5

The Pain indicator is a custom forex indicator that shows the OHLC candlestick price ratio over a specified time period. This is an oscillator.

It’s good to be aligned with customizable inputs, which are the following:

Period – defines the period deployed in the calculation;

Method – defines the method used for the calculation.

The formula for the Pain indicator:

The calculations of the Pain indicator are based on the following formula:

Pain = (3*MA(Close) – MA(Open) – MA(High) – MA(Low)) / 2

Where:

MA – moving average with the Period time period and the Method calculation method.

How to use the Pain indicator:

That forex indicator allows determining a market sentiment, whenever it’s bullish or bearish. When the light green signal line is aligned above 0 level, the sentiment is considered bullish. Similarly, when the light green signal line is aligned below 0 level, the sentiment is considered bearish.

Another way of using the Pain indicator is divergence trading. In order to do that, a trader needs to wait for the price to make higher highs while indicator develops a corresponding lower lows (for bearish divergence). On the other side, a trader can wait for the price to make lower highs, while the indicator main signal line develops a corresponding higher highs (for bullish divergence).


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