Democratic Fibonacci Moving Averages

The Democratic Fibonacci Moving Averages indicator utilizes a collection of ten exponential moving averages based on Fibonacci sequences to determine market trend and momentum through a unified "Democratic" average. By aggregating multiple timeframes into a single consensus line (DFMA), the tool provides a smoothed signal that filters out market noise while highlighting key crossover points for trend identification.

Usage

The Usage section focuses on how to interpret the various moving averages and the core DFMA line to identify potential trade entries and exits.

• Trend Identification: The DFMA line changes color based on its relationship with the 233-period Fibonacci MA. A green DFMA indicates the average of all Fibonacci lengths is above the long-term anchor, suggesting a bullish trend, while a red DFMA suggests a bearish trend.
• Crossover Signals: Traders can use the interaction between the DFMA and the 233-length Fibonacci MA as a signal. A crossover of the DFMA above the 233 MA can be interpreted as a long signal, whereas a cross under can be used for short positions.
• Visual Ribbon: The blue lines represent intermediate Fibonacci lengths (5 to 144). The expansion or contraction of these lines provides a visual representation of trend strength and volatility.
• Table Overlay: The on-screen table provides real-time price data relative to each Fibonacci MA. The cell colors indicate whether the current price is above (bullish) or below (bearish) that specific moving average, or if the price is currently crossing it (neutral).

Details

The script calculates ten Exponential Moving Averages (EMAs) using the following Fibonacci lengths: 3, 5, 8, 13, 21, 34, 55, 89, 144, and 233. The "Democratic Fibonacci Moving Average" (DFMA) is the arithmetic mean of these ten values. This approach gives equal weight to short, medium, and long-term trend data, creating a "consensus" value.

The technical construction uses the 3 and 233 lengths as primary boundaries (plotted with thicker lines), while the DFMA serves as the primary signal line. Alerts are optimized for the crossover between the DFMA and the 233 MA to notify users of potential trend shifts on the close of a bar.

Settings

• Source: Determines the price data used for all moving average calculations (default is OHLC4).
• Panel position: Adjusts the location of the informational table on the chart (top, middle, or bottom).
• Bull: Sets the color used for bullish signals in the table and the DFMA line.
• Bear: Sets the color used for bearish signals in the table and the DFMA line.
• Neutral: Sets the color used for neutral or transitional states within the table cells.

FAQ

How do I interpret the DFMA line color? The DFMA line turns green when the average of all Fibonacci MAs is higher than the 233-period MA and red when it is lower, helping to visualize the immediate trend direction relative to a long-term baseline.

What do the different line thicknesses represent? The thickest line is the DFMA (the consensus average), while the medium-thickness white lines represent the shortest (3) and longest (233) Fibonacci periods to define the range of the ribbon.

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