I want to show the use of one very interesting indicator mod, that was done by a friend of mine.
This is a major upgrade. It is all about the book "Volatility Illuminated" by Mark Whistler.
The indicator uses the code that is given at the end of the book, but instead to use a Moving average in the calculations of the volatility we use a Fractal adaptive moving average. This is thanks to the work of Jean - Philippe Potton.
I think this mod is available on Forex TSD in my thread about the Digital ASCTrend but if you cannot find it I could upload it. You need to install the fractal moving average FRAMA v2 in order to work.
How we read that?
It is actually very simple. We have two volatilities. Short term volatility and a longer term volatility.
The border line is the level 0.50. If it is above 0.5 we have a good volatility. If it is below 0.5 we have low volatility.
The best signal is when both of them are below 0.5 and the go up together. You can see that that the short term volatility gives some really nice spots when you can enter into an established trend.
What really I like with the mod is that the longer term volatility is much more reactive and that is due to its fractal adaptation.
Bear in mind that this is not a directional indicator.
That is all by now. I will keep it updated.
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