DeMarker Trading Signals: Strength, Extremes and Divergence
Summary
The article introduces DeMarker, an oscillator based on changes in successive highs and lows. It explains the calculation using moving averages of upward and downward price extensions and describes the indicator’s scale from zero to one. The proposed interpretations include relative strength when the current reading is compared with its five-period average, overbought and oversold conditions near 0.70 and 0.30, and simple divergence signals based on price highs or lows moving opposite to the indicator.
The tutorial turns these ideas into signal blueprints and describes implementing them in MetaTrader 5 with MQL5, including reading indicator-buffer values and displaying conditions on a chart. It is an educational coding example, not a tested trading system: the article provides no performance results or evidence that the signals are profitable. The divergence examples compare adjacent observations and are explicitly simpler than methods that compare price and oscillator swing highs and lows. The text also contains inconsistencies in its descriptions of some signal outputs, so the rules should be checked before implementation.
Key ideas
- DeMarker compares smoothed upward and downward extensions in successive highs and lows.
- The article treats readings above 0.70 as overbought and readings below 0.30 as oversold.
- A current value above or below its five-period average is used as a basic strength or weakness signal.
- Simple divergence rules compare changes in price highs or lows with the direction of the indicator.
- The MQL5 examples generate chart signals but provide no evidence of trading performance.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.