Using a Modified DPO to Turn a Moving Average into a Reference Level

Summary

This indicator defines a modified Detrended Price Oscillator as the closing price minus a moving average. Users can adjust the moving average period, calculation method, and applied price, allowing them to change the resulting curve. The description says these controls can be used to make the moving average curve horizontal and treat it as a possible support or resistance reference.

The document gives the formula and names four moving average methods: simple, exponential, smoothed, and linear weighted. It provides no chart examples, signal rules, backtest, or evidence that the resulting levels predict price behavior. It also does not explain the conditions for selecting parameters or distinguish the indicator's output from conventional DPO settings. Traders would need to evaluate the chosen configuration and level behavior on their own data.

Key ideas

• The indicator value is calculated as the bar close minus a configurable moving average.
• Users can choose the moving average period, calculation mode, and applied price.
• The modified curve is presented as a way to construct potential support or resistance references.
• The document provides a formula and parameter description but no performance evidence.

Tags

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