Separated Moving Averages for Positive and Negative Candles

Summary

This indicator plots separate moving averages for prices associated with positive and negative candles. Each series updates when its respective candle direction occurs and carries forward its last value on bars of the opposite direction. The user can choose a simple, exponential, or Hull moving average and set its length. A conventional moving average can also be displayed for comparison.

Heikin Ashi candles are enabled by default to classify candle direction, though the values being averaged are regular closing prices. The author describes the spacing between the two lines as a way to observe trend speed or possible weakness when price returns toward the middle, and mentions a possible filter based on closing beyond both lines. These are qualitative interpretations, not tested trading rules. The document provides no results or validation, so the indicator should be treated as a visualization whose behavior depends on the averaging method, length, and candle input.

Key ideas

• The indicator maintains separate moving average series for positive and negative candle conditions.
• The inactive series carries its previous value forward when a bar has the opposite direction.
• Users can select SMA, EMA, or HMA and optionally plot a regular moving average.
• Heikin Ashi data is used by default to classify direction, while regular closes feed the averages.
• The author suggests reading line separation and price returns toward the middle as qualitative trend context, without performance evidence.

Tags

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