The technical analysis tool that I will tell you about today can be especially useful for novice traders. This is due to the fact that it does not require any special skills to assess the situation and signals. However, this is also typical of other indicators belonging to the arrow category. LH Deviation analyzes market volatility and generates entry signals. They are displayed on the chart as an arrow (buy – a white arrow, sell – a red one).
The choice of a trading instrument and timeframe is at your discretion. There are no restrictions.
Installation in MT4 is standard. I described the procedure in the article “Metatrader 4 Cheat Sheet” . Now let’s move on to the settings of the LH Deviation indicator.
While working with the settings, you should pay attention to the following parameters.
The number of candles that the indicator should use in its calculations is determined by the “History” variable.
The timeframe you have chosen for trading should be indicated by the “Time-Frame” line.
The “Price” parameter is used to specify the type of price that will be used in the indicator algorithm (open price, close price, average price, etc.).
Specify the period, respectively, on the line “LH-Period”.
The Deviation parameter is used to adjust the deviation.
The rest of the parameters in the settings are not very important. They relate to options for notification of a favorable situation for opening trade orders. You don’t have to change anything, but you can customize it according to your personal preferences.
On the chart, the indicator will look like this:
If a white arrow appears on the chart, it means that you can open a buy order. You can make a decision on a sell deal if a red arrow appears.
As you can see, everything is very simple.
We limit possible losses using stop-losses, which we place near local extremes. Well, you can close a profitable deal in different ways. Alternatively, when an arrow of a different color appears. Or you can focus on important levels or the size of the stop loss. The LH Deviation indicator in any case requires testing on a demo account. During such a trade, you can try different ways of taking profit and choose the best one. I would also recommend adding an additional technical analysis tool as a signal filter. In my example, this is a volume indicator.