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Reading a Trend Histogram with Overbought and Oversold Levels

Article MQL5 code base
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Summary

This document explains a trend indicator that displays values as a colored histogram relative to zero and user-defined overbought and oversold levels. The colors distinguish four regions: above the upper threshold, positive but below that threshold, negative but above the lower threshold, and below the lower threshold. Users can set the colors used to mark the overbought and oversold levels.

The note identifies the indicator as originally written in MQL4 and gives its publication date in the MQL4 code base. It does not describe the calculation behind the histogram, provide trading rules for interpreting its signals, or present testing evidence. As a result, it teaches how the display encodes threshold regions, but not whether those regions predict price direction or how the indicator should be used in a strategy.

Key ideas

  • The indicator presents trend values in a histogram divided by zero and upper and lower thresholds.
  • Four colors identify values above, within, or below the defined threshold regions.
  • The user can configure the colors associated with the overbought and oversold levels.
  • The document explains the display but gives no calculation method, trading rules, or performance evidence.

Tags

Technical indicatorsTrend following

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