Coloring Candlesticks by Moving-Average Trend and Fast-Average Slope

Summary

This indicator colors candles according to the relationship between a faster and a slower moving average, with the periods and average types configurable. When the faster average is above the slower one, candles receive a green shade; when it is below, they receive a red shade. The indicator then checks the faster average’s slope to use a darker shade when it is declining during the bullish alignment or rising during the bearish alignment.

The result is a compact visual overlay that separates trend alignment from a short-term counter-move in the faster average. The document gives an example using periods of 10 and 50 and shows the color rules, but it provides no test results or guidance on using the colors as entry or exit signals. It also leaves equal moving-average values and other initialization conditions unspecified, so the display should be treated as a visual classification aid rather than a validated trading strategy.

Key ideas

• The indicator uses two moving averages to classify trend direction.
• It colors candles green when the fast average is above the slow average and red when it is below.
• A change in the fast average’s slope selects a secondary shade within each trend state.
• The periods and moving-average types can be changed.
• The document presents a charting aid and does not provide evidence of profitability.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.