MACD-AS

The MACD-AS indicator provides a modified approach to the traditional Moving Average Convergence Divergence by applying secondary smoothing to capture trend shifts earlier than standard MACD calculations.

Usage

The Usage section focuses on identifying trend momentum and potential reversal points through the interaction between the MACD-AS histogram and its signal line.

• Trend Identification: When the MACD-AS histogram is above the zero line and increasing, it suggests strong bullish momentum. Conversely, a histogram below zero and decreasing suggests strong bearish momentum.
• Signal Line Crossovers: A primary method of interpretation involves the crossover between the MACD-AS (histogram) and the Signal line. A cross above the signal line can be interpreted as a bullish entry or momentum shift, while a cross below suggests a bearish shift.
• Early Detection: Because this calculation is based on the difference between the MACD and its average, it often reacts more sensitively to price changes, potentially offering earlier signals than a standard MACD.

Note that as a trend-following tool, the MACD-AS is most effective in trending environments and may produce false signals during sideways or range-bound market conditions.

Details

The MACD-AS (MACD Aspray) was developed by Thomas Aspray. The logic behind this script involves taking the standard MACD calculation (Fast EMA - Slow EMA) and calculating its signal line. Instead of simply plotting these, the indicator calculates the difference between the MACD and its signal line (effectively the MACD Histogram) and then applies an additional EMA smoothing to that result to create a new signal line. This "histogram of the histogram" approach aims to filter noise while highlighting the rate of change in momentum.

Settings

• Fast Length: The period for the shorter-term Exponential Moving Average (EMA) used in the initial MACD calculation.
• Slow Length: The period for the longer-term Exponential Moving Average (EMA) used in the initial MACD calculation.
• Signal Smoothing: The period used to smooth the MACD-AS to create the blue signal line.
• Source: The price data point (e.g., Close, Open, High, Low) used for the calculations.

FAQ

How do I use the MACD-AS for entries?

Users typically look for crossovers where the histogram crosses the signal line or the zero level to identify shifts in market momentum.

How does this differ from a regular MACD?

The MACD-AS uses the difference between the MACD and its signal as the primary oscillator, whereas a standard MACD uses the difference between two EMAs. This often results in faster reaction times to price turns.

How can I access the MACD-AS?

You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.