Ease of Movement Signals and Threshold-Based Reversal Entries

Summary

This script turns the Ease of Movement indicator into a long-or-short strategy. It estimates movement using changes in price midpoint relative to volume and the bar’s high-low range. Larger positive or negative readings indicate relatively easy movement in that direction; readings near zero indicate less movement relative to volume. User-defined positive and negative thresholds determine when the strategy switches direction, and an optional setting reverses those signals.

The document explains the indicator’s interpretation and shows how the script plots its readings, colors bars by position, and submits strategy entries. It provides no performance results, tested market, or comparison with alternative settings. The stated threshold defaults and calculation are part of the example rather than evidence of a profitable parameter choice. The source also presents itself as educational, so the strategy should be treated as an indicator demonstration rather than a validated trading system.

Key ideas

• Ease of Movement relates price movement to volume and the bar’s trading range.
• Positive readings represent upward movement, while negative readings represent downward movement.
• The strategy enters long or short when the indicator crosses user-defined thresholds and otherwise retains its prior position.
• An optional reverse setting swaps the direction of the signals.
• The document provides no backtest evidence to establish the strategy’s performance.

Tags

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