Hull Moving Average Crossover

The Hull Moving Average Crossover indicator identifies trend reversals and momentum shifts by calculating the intersection of derived Hull Moving Average components to provide actionable swing trading signals.

Usage

The Hull Moving Average Crossover is used to identify potential entry and exit points based on the directional slope of the Hull Moving Average (HMA). Traders can monitor the visual cues on the chart to determine the current market state:

• Bullish Momentum: Indicated by green bar coloring and background shading. This occurs when the primary crossover calculation (longcross2) rises above the secondary calculation (longcross1).
• Crossover Signals: An "X" label appears at the bottom of the chart when a trend change is detected. This serves as a visual confirmation of a crossover event.
• Trend Stability: Thick line segments are plotted on the chart when a crossover is detected, providing a reference point for the price level where the trend shifted.

Users can adjust the "HullMA cross" length to fine-tune the sensitivity of the signals, where shorter lengths respond faster to price changes and longer lengths provide smoother, more filtered trend identification.

Details

This script is based on the original work by SeaSide420 and has been refactored for modern performance. The underlying logic utilizes the Hull Moving Average's unique calculation method, which involves:

1. Calculating two Weighted Moving Averages (WMA) with different periods (the full length and half the length).
2. Taking the difference between these WMAs.
3. Calculating a final WMA of that difference using the square root of the original length.

This specific implementation goes further by comparing these HMA values against their previous states (n1 vs. n2) and a momentum-based "longcross" calculation. This secondary calculation amplifies the difference between current and historical HMA values to highlight when the price movement is accelerating in a specific direction.

Settings

• HullMA cross: Determines the period used for the Hull Moving Average calculations. Higher values reduce noise but increase lag.
• Source: Selects the price data used for the calculation (e.g., Close, HL2, OHLC4). Using OHLC4 can provide a more balanced representation of the bar's price action.

FAQ

How does the Hull Moving Average differ from a Standard Moving Average? The HMA is designed to significantly reduce lag compared to a Simple or Exponential Moving Average while remaining smooth. It achieves this by using weighted averages and a square root period calculation.

What does the "X" label signify on the chart? The "X" label indicates a crossover between the internal momentum components of the HMA. This typically marks a point where the trend direction has officially shifted according to the indicator's logic.

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