Watch the testing video here:
SMA Rainbow Trend Indicator
Introduction to the SMA Rainbow Trend Indicator
The SMA Rainbow Trend indicator is a very popular trend-following indicator that consists of multiple colorful moving averages.
The way to use that gauge is really simple. When all moving averages are pointing up – there is a bullish trend. Similarly, when When all moving averages are pointing down- there is a bearish trend. Avoid trading when MA’s are embroiled, or the price is plotted inside the rainbow.
An example entry point would be based on SMA Rainbow Trend plus some price action pattern: during a downtrend, the price could make a small upward correction. Next, a rejection could happen (like pin bar), and then a continuation signal like an engulfing candle could occur.
It fits all kinds of timeframes and currency pairs.
The indicator is displayed directly on the main trading chart.
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.
How to set up the SMA Rainbow Trend indicator in MT4?
Copy and paste the SMA_Rainbow.ex4 or SMA_Rainbow.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.
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