A1 Trading Company

Ticker tape by TradingView

July 21, 2020

Introducing The New Trading Scanner- The XMR Indicator

Frank Cabibi

The A1 Trading team has been developing another trading tool that we believe will be very helpful in finding extreme readings in the markets. The scanner is fundamentally volatility reader on multiple periods. The user has the choice to select 5 "lookback" periods, which basically read the volatility of each period set, and compute a total reading, -5 to 5. For example, if the 4 day lookback period, the 7 day lookback period, and the 14 day lookback period all show signs of overbought, the indicator may print a +3 reading on the indicator. A +5 would mean that all lookback periods are printing overbought.

The XMR Indicator 

The extreme mean reversion indicator (XMR) is a chart indicator used to identify potential reversals in a financial market. The XMR indicator specializes in scanning previous price action in order to signal potential overbought or oversold conditions in a market. The XMR is displayed as a bar chart, with a set range from -5 to +5. +5 is considered extremely overbought, and -5 being extremely oversold (dark gray)

The tool was built with the concept of mean reversion in mind, meaning that markets often return to historical means. With this in mind, this tool can be utilized to look for markets that have significantly moved away from their historical means and may be due for a reversal.

The extreme mean reversion indicator (XMR) is a MT4 chart indicator used to identify potential reversal signals in a financial market.

Range

The available range for the XMR Indicator is -5 to +5. A reading of -5 is considered extremely oversold, while a reading of +5 is considered extremely overbought. However, these readings are rare, and are not the only levels to consider.

Usability

The XMR indicator has a wide range of potential uses. It can be a great tool for both trading range bound markets, or finding pullback setups in a trending market condition. 

A reading on the XMR indicator of +1 to +5 is considered a market in which price is overbought, with +5 being more overbought than a reading of +1. Inversely, a reading of -1 to -5 is considered a market in which price is oversold, with -5 being more oversold than a reading of -1. 

With this information, the XMR indicator can help spot a potential reversal in a market. Combining this information with other signals, such as a price action patterns, a fundamental bias, or other technical pattern could be useful in finding profitable trading setups.

Example 1 - Trading Ranges:

The XMR indicator usually excels in a range bound market. The XMR indicator does a decent job at finding tops and bottoms in the range. A trader using the tool could look for readings indicating that markets may be stretched, combine it with additional technical signals, and take trades accordingly.

Example 2 - Trading Trends:

When a market is trending strongly, looking for reversals may be less profitable. However, the XMR indicator may be a great way to spot and time pullbacks that have a strong likelihood of failing in favor of the dominant trend.

How to Customize the Scanner

The scanner already has lookback periods built in to the input, but you can choose whatever time periods as well as whatever design you want.

Once the indicator is running, you can right click on the indicator and click 'Indicator Properties'.

There, you can change the lookback periods or design of the chart.

Conclusion

The purpose in making this scanner was to help traders see one of the strategies our team uses. We believe this to be very helpful and accurate for traders of all levels, who like to trade on mean reversions or reversals. Not every indicator is perfect, but they can be used as tools for insight on any kind of market you want to trade. This scanner is meant to help the user gauge their trade or alert them when prices enter a new territory of overbought or oversold. Overall, it's a great tool and hopefully our users will find it helpful as well.

Hope you all enjoy it! We will be using this tool in action for more of our trades so stay tuned!

How to Get A Copy of the XMR Indicator

To get a copy of the XMR indicator, you can purchase the software here OR you can get a copy of the XMR indicator for free with a purchase of the Gold Membership!


A1 Edgefinder

#1 Market Scanner Tool
Take 10% off using code "READER"
GET ACCESS NOW
Want to See Our Trades?

Join The VIP Community!

Our entries, exits & analysis
Live Webinar Coaching
Trading Chatrooms
Strategy Library 
Exclusive Trading Guides
Use Code "READER" for 10% OFF!
JOIN NOWJoin FREE Discord
Listen to More Episodes
Even More Bullish USD News

This morning at 8:30 am Eastern Time, the United States’ Bureau of Economic Analysis released even more bullish USD news. The Core Personal Consumption Expenditures (PCE) Price Index, which measures changes in prices for consumers (excluding volatile food and energy prices), rose more than expected month-over-month. A 0.5% increase was expected for August, with 0.6% […]

Read More
Historic Peril for the Pound

A strange series of events recently sent the United Kingdom’s Pound Sterling tumbling to historic lows. Just weeks after the death of Queen Elizabeth II (a head of state who was uniquely well-liked among the UK’s population by contemporary standards) Kwasi Kwarteng, Britain’s new chancellor in recently appointed Prime Minister Liz Truss’ administration, issued a […]

Read More
Get Ready for the Bear Market

Last week’s selloff was brutal for investors in the US stock market: the Dow Jones Industrial Average closed at its lowest level since late 2020, falling to 29590.41, losing 1.6% on Friday alone. With the S&P 500 currently down a whopping 23% from January’s highs this year, and other indexes close behind percentagewise, stock market […]

Read More
DISCLAIMER: All comments made by TraderNick’s Forex Group, LLC are for educational and informational purposes only. All comments should not be construed as investment advice regarding the purchase or sale of any securities or financial instrument of any kind. Please consult with your financial adviser before making an investment decision regarding any securities or financial instruments mentioned by TraderNick’s Forex Group, LLC. TraderNick’s Forex Group, LLC assumes no responsibility for your trading and investment results. All information on any of the platforms utilized by TraderNick’s Forex Group, LLC was obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. TraderNick’s Forex Group, LLC, its employees, representatives, and affiliated individuals may have a position or effect transactions in the securities and financial instruments herein and or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies. Trading of any type involves very high risk and may not be suitable for all investors. TraderNick’s Forex Group, LLC, its subsidiaries and all affiliated individuals assume no responsibility for your trading and investment result. Read our full disclaimer here
Home
Edgefinder
VIP
Menu
homesmartphonelaptopmenu linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram