The Moving Average ribbon plots 2 moving averages on the chart. 1 - A fast moving average. 2 - A slow moving Average. The moving average periods as well as the averaging type can be customized with the parameters. The area between the 2 moving averages is called the ribbon.
When price is trading in the ribbon area, trend is losing momentum. Strong trends emerge when price breaks above or below the ribbon. The red and green arrows shows the moving average cross over. These can be used as moving average cross over signals. The moving averages can act as support or resistance. The parameters can be changed in the VTL Editor. Double click on the indicator name, and the script is opened in VTL editor. The parameters are placed at the top of the script file and properly commented for ease of use. The 2 moving average periods, moving average type (simple MA, Exponential MA, Time Series Ma etc) and price field to calculate moving average (open, high, low, close, avg. price etc.) are defined by the parameters.
The trend direction is determined by the position of the fast moving average in relation to the slow moving average. If fast moving average is above slow moving average, trend direction is up and “Buy” is displayed on chart. When fast moving average is below slow moving average, trend direction is down and “Sell” is displayed on chart.
MovingAverageRibbon1.zip (3.67 KB)
