Ultimate Momentum Indicator
Feb 25, 2020
The Ultimate Momentum Indicator tool provides a comprehensive bird's-eye view of market momentum by consolidating data from four major technical analysis indicators into a single histogram-based interface.
Usage
The indicator allows traders to monitor multiple momentum factors simultaneously without cluttering the main price chart.
- MACD Histogram: The primary component of the visual is a standard MACD histogram. Traders use this to identify the strength and direction of the price momentum based on the relationship between two moving averages.
- RSI Warnings: The histogram bars change to amber (yellow) whenever the RSI exceeds the user-defined overbought (default 70) or oversold (default 30) thresholds. This serves as an immediate visual warning of potential exhaustion.
- ADX Trend Strength: Crosses along the zero line represent the Average Directional Index. Blue crosses signify the ADX is below the trending threshold (default 25), while orange indicates a strong trend. Darker shades indicate rising trend strength, while lighter shades indicate weakening strength.
- Parabolic SAR Direction: Colored dots at the tip of each histogram bar represent the Parabolic SAR status. A green dot indicates the PSAR is below price (bullish), while a red dot indicates it is above price (bearish).
Details
The script integrates MACD, RSI, ADX, and PSAR into a cohesive dashboard. Rather than replacing these indicators, it extracts key data points—such as direction, trend strength, and extreme levels—and maps them to a single visual element. This implementation uses a custom label positioned at a user-defined offset to display the raw values of RSI and ADX, ensuring that precise data is available alongside the visual signals.
Settings
MACD Settings
- Fast/Slow Length: Determines the periods for the two moving averages used to calculate the MACD line.
- Signal Smoothing: Sets the length of the signal line.
- Simple MA (Oscillator/Signal): Toggles between Exponential Moving Averages (EMA) and Simple Moving Averages (SMA) for calculations.
RSI Settings
- RSI Length: The lookback period for the RSI calculation.
- RSI High/Low Warning: Customizable levels that trigger the amber color change in the histogram.
ADX Settings
- ADX Smoothing/DI Length: Parameters for calculating the ADX and Directional Indicators.
- ADX Crossover: The threshold at which the ADX crosses are considered to indicate a "strong" trend.
PSAR Settings
- PSAR Start/Increment/Max: Standard parameters for the Parabolic SAR sensitivity and acceleration.
Visual Settings
- Label Offset: Adjusts the horizontal position of the RSI/ADX data label to fit different chart layouts.
FAQ
How do I interpret the amber histogram bars?
Amber bars indicate that the RSI has moved outside your specified normal range (overbought or oversold), suggesting that the current momentum may be reaching an extreme.
What do the crosses on the zero line mean?
These represent the ADX. Orange crosses signify a strong trend (above the crossover level), while blue crosses suggest a weak or non-trending market.
How can I access the Ultimate Momentum Indicator?
You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.
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