Super-Smoothed Weighted Moving Average with Direction Coloring

Summary

This indicator builds a smoothed weighted moving average from closing prices in two stages. It first combines a short weighted average with a longer one to emphasize recent price movement, then applies another weighted average using a period derived from the square root of ten. The output is colored according to whether its current value is above or below its previous value, offering a visual cue for the line’s direction.

The document provides the calculation but no chart examples, performance results, or trading rules for acting on the color changes. It therefore describes an indicator construction rather than a complete strategy. The direction coloring alone does not establish trend quality or predict future returns, and the material gives no evaluation of lag, sensitivity, market suitability, or transaction costs.

Key ideas

• The indicator blends weighted averages of closing prices over short and longer periods.
• A further weighted average is applied to smooth the blended series.
• The line is colored according to whether its value rose or fell from the prior observation.
• The document supplies no backtest or standalone entry and exit rules.

Tags

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