AMA (Adaptive Moving Average)

AMA (Adaptive Moving Average) is a VertexFX Indicator for trading market cycles. The AMA indicator uses closing prices and difference between closing prices over the AMA_PERIOD. It uses concept of signal-to-noise ratio to smooth whipsaws in price changes. As result it catches new trends quickly as they happen allowing the traders to place thier trades early.

AMA (Adaptive Moving Average) first calculates the difference between the current close and the close AMA_PERIOD for previous X candles – as Numerator. Then it calculates the sum up absolute changes in close prices over this AMA_PERIOD as Denominator. The Numerator then is divided by Denominator to calculate the raw AMA, this value is smoothed using the FAST_FACTOR and SLOW_FACTOR parameters.

Buy – Place buy position when price crosses (and closes) above the AMA line. Place stoploss (SL) below the AMA line and keep trailing it upwards.

Sell – Place sell position when price crosses (and closes) below the AMA line. Place stoploss (SL) above the AMA line and keep trailing it downwards.

Usage

• Download the attachment.
• Copy it to your company VertexFX  Local VTL Files folder i.e. C:Program FilesCompany Namevtl10Local VTL Scripts
• Restart your Client Terminal or Right Click on “Local VTL Scripts” Tree Node to find the script.