Sibbet Demand Index Divergence Indicator

Introduction to the Sibbet Demand Index Divergence Indicator

The Sibbet Demand Index Divergence indicator is a custom forex trading indicator that uses the moving average of the price data. It helps traders to understand whether the bullish or bearish movement in the price is getting stronger or weaker.

That gauge is made of the histogram and the moving average (signal line).

The indicator is displayed in a separate window placed just below the main trading chart. It fits all kinds of timeframes and currency pairs.

The default settings can be modified directly from the input tab. Feel free to experiment with the settings and parameters to fit your personal preferences.

See also: OBV Divergence Indicator

How does it work? How to apply in trading?

Trading Rules Explanation

Buy Entry:

Open long trade, when the price is forming lower high and lower low structure.
There is bullish divergence in price and Sibbet Demand Index.
There is bullish crossover of the histogram line and the signal line.
Place your stop loss a few pips below last swing low.
Take profit at preferable R:R ratio.

Sell Entry:

Open short trade, when the price is forming higher high and higher low structure.
There is bearish divergence in price and Sibbet Demand Index.
There is bearish crossover of the histogram line and the signal line.
Place your stop loss a few pips above last swing high.
Take profit at preferable R:R ratio.

As always, to achieve good results, remember about proper money management. To be a profitable trader you need to master discipline, emotions, and psychology. It is crucial to know when to trade, but also when not to trade. Avoid trading during unfavorable times and market conditions like low volume/volatility conditions, beyond major sessions, exotic currency pairs, wider spread, etc.

How to set up the Sibbet Demand Index Divergence indicator in MT4?

Installation Guide

Download the Sibbet Demand Index Divergence.rar archive at the bottom of this post, unpack it, then copy and paste the Sibbet Demand Index Divergence.ex4 or Sibbet Demand Index Divergence.mq4 indicator files into the MQL4 folder of the Metatrader 4 trading platform.

You can gain access to this folder by clicking the top menu options, which goes as follows:

File > Open Data Folder > MQL4 > Indicators (paste here).

Now go to the left side of your MT4 terminal. In the Navigator find the gauge name, right-click it and select Attach to the chart.