Accumulation Deceleration Indicator

Acceleration / Deceleration Indicator (Accumulation / Deceleration, AD)

# Earnings on Forex , # Forex Indicators

But did you know that the price of a trading instrument does not just change over time, but changes at a certain speed? And how does the slowdown or acceleration of this process affect the market? Bill Williams knew exactly the answers to the questions posed, about which, in fact, he wrote the book “Trade Chaos”.

The great trader in his work calls the Accumulation / Deceleration (AD) indicator, a leading oscillator capable of showing future price changes. The Profitunity strategy, based on this indicator, is based on the assessment of acceleration or deceleration of the price movement force.

However, what specifically gives this knowledge to the trader? What can he do, understanding the current acceleration / deceleration of the force of price changes?

Before you continue to study this material, understand the main thing! What the indicator is showing now is the result of processing a large amount of data.

In order for the market to really develop, the forces driving it now must change to the opposite current direction! Moreover, a little earlier, these same forces should slow down before then, after changing the vector, accelerate.

Acceleration / Slowdown indicator – indicates that bar / candle on the chart, which, subsequently, will become the springboard of the subsequent movement.

All or almost all of the tools that Bill Williams did for trading are built into the MT4 and MT5 trading platforms by default. Add an indicator to the chart of a trading instrument of labor will not be.

Open the menu “Insert – Indicators – Bill Williams”

Under the graph, a red-green histogram of the indicator appears, divided by a zero line in the middle.

Using the Acceleration / Deceleration oscillator in trading is quite simple. Before a reversal or continuation of movement in the direction of the trend, the current driving force slows down. Red lines of the indicator indicate slowdown, green growth.

Bill Williams recommends using this indicator on time frames, starting from the daytime. Only in this way, in his opinion, trade can be effective. On smaller time charts, the indicator will generate a lot of false signals to enter the deal. Although many modern traders have learned to use AC as an addition to other indicators in a trading strategy, even on five-minute charts.

Buy deals should be looked for when the indicator draws a green line, and it is above the zero – signal line. For sale, respectively, on the contrary, a red line is drawn, and it is below zero. At the same time, the strategy can be improved by a fairly simple rule – wait for two lines that satisfy the above conditions, instead of one.

Opening a purchase transaction:

At the same time, despite the conditions, other buy signals can be considered. For example, the appearance on the histogram, below the zero mark, of three green lines – we buy. For sale – vice versa (three red lines appeared in a row).

The Acceleration / Deceleration (AD) indicator for MT4 can be downloaded here

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