UltraMFI: Aggregating Smoothed MFI Trend Signals into a Cloud
Summary
UltraMFI builds a trend display from multiple smoothed Money Flow Index readings. It creates a range of smoothing periods using an arithmetic progression: a starting length, a step size, and a count of period changes. For each period, it assesses the direction of the smoothed readings, counts positive and negative directions, and smooths those totals into lines that form a colored cloud. The cloud’s color indicates the prevailing direction, while its width represents the strength of that directional agreement. Optional upper and lower levels mark overbought and oversold zones.
The indicator supports ten smoothing methods, including common moving averages and adaptive methods such as JMA, VIDYA, and AMA. Some parameter meanings depend on the selected method, so settings are not interchangeable. The document explains the construction and configuration but provides no trading rules, backtest, or evidence that the cloud predicts returns. It also relies on an external smoothing library, which is needed to run the implementation.
Key ideas
- UltraMFI evaluates smoothed MFI readings across a progression of periods.
- It counts positive and negative trend directions and smooths those counts into a cloud.
- Cloud color represents direction, while cloud width represents the degree of directional agreement.
- Overbought and oversold levels can be configured as percentages of the indicator range.
- Smoothing parameter meanings vary by algorithm, and the document gives no performance validation.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.