Choppiness Index Scalper Metatrader 4 Forex Indicator
The Choppiness Index Scalper MT4 forex indicator is a short-term trend signal generator.
The indicator deploys two extreme values, 0 and 100 respectively.
However, the most important values to take a look at are the 38.2 and 61.8 values.
The Choppiness Index Scalper MT4 creates a channel that floats around the 2 aforementioned values.
A yellow signal line fluctuates slowly above and below the 38.2 and 61.8 values.
This is how the indicator generates its buy and sell signals.
During a downtrend, wait for the yellow signal line to hit the 61.8 level and go short.
During an uptrend, wait for the yellow signal line to hit the 38.2% level and go long.
How to identify the overall market trend?
Add a longer-term trend following indicator to the chart such as the 200 period simple moving average.
Price is trending up when price bars are positioned above the 200 period MA.
Conversely, price is trending down when price bars are positioned below the 200 period MA.
The EUR/USD 1-Hour chart below displays the Choppiness Index Scalper Metatrader 4 Forex indicator in action.
Basic Trading Signals
Signals from the Choppiness Index Scalper MT4 forex indicator are easy to interpret and goes as follows:
Buy Signal: Initiate buy trade position when the yellow line hits the 38.2 level and the overall trend is upward. Confirm the uptrend with a trend following indicator.
Sell Signal: Initiate sell trade position when the yellow line hits the 61.8 level and the overall trend is downward. Confirm the downtrend with a trend following indicator.
Trade Exit: Use your own method of trade exit.
MT4 Indicator Characteristics
Currency pairs: Any
Platform: Metatrader 4
Type: Chart pattern indicator
Customization options: Variable (choppiness period, smoothing period, standard deviation period, alerts) Colors, width & Style.
Time frames: 1-Minute, 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours, 1-Day, 1-Week, 1-Month
Copy and paste the choppiness-index.mq4 into the MQL4 indicators folder of the Metatrader 4 trading platform.
You can access this folder from the top menu as follows:
File > Open Data Folder > MQL4 > Indicators (paste here)