Skip to content
All library documents

Using Standard Deviation Dots to Classify Moving Average Trend Strength

Article MQL5 code base
Read the original

Summary

This document describes an indicator that adds a three-level trend-strength display to a rounded moving average. It uses the standard deviation of the moving-average indicator and compares that value with two user-set thresholds. When the value lies between the thresholds, a small dot appears in the color of the current trend direction; when it exceeds the upper threshold, the dot becomes larger. No dot represents the weak category, while small and large dots represent medium and strong categories respectively.

The note identifies the two threshold parameters and says the implementation relies on moving-average and smoothing classes from a shared library. It does not give a formula for the standard deviation calculation, define how trend direction is determined, or present charts, backtests, or evidence that the strength labels predict future returns. The dots should therefore be read as a visual classification produced by this indicator, not as demonstrated standalone trading signals.

Key ideas

  • The indicator classifies moving-average trend strength into weak, medium, and strong levels.
  • Standard deviation thresholds determine whether a dot appears and how large it is.
  • Dot color indicates the current trend direction.
  • The document provides no performance evidence for using the classifications as trading signals.

Tags

Technical indicatorsStatistics

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