Laguerre Filter Indicator

Laguerre Filter Indicator

Laguerre Filter indicator for mt4. Trend reversal indicator. Forex Crossover indicator. Trend following indicator.

The Laguerre Filter indicator for MetaTrader is a forex technical indicator designed based on one of John Ehlers’ trading strategies. The indicator helps to demystify and eliminates the need to grasp the unpopular concept of the gamma parameter as explained by John Ehlers.

This MT4 indicator looks somewhat like a moving average, but it isn’t. The Laguerre Filter indicator is built with smoothing features which makes it less likely to lag from the price. The indicator may look simple on the chart, but yet powerful in filtering and identifying the trend of the market. This in turn helps you to easily define the market bias and make informed trading decisions.

The indicator can be very handy to scalp a few pips from the market. It also works great for day and swing trading. Furthermore, novice traders would easily use and benefit from this trading tool since it isn’t so complex on the chart. The experienced traders on the other hand can use it as a confluence for their analysis.

Laguerre Filter Indicator BUY/SELL Signals

The above picture shows how the Laguerre Filter indicator would look on your MT4 chart. The picture also illustrates how the BUY/SELL setups were generated.

The Laguerre Filter indicator comes with a lone signal line for both BUY and SELL trade signals. It suggests a possible bullish trend when the price is above the signal line of the indicator. Conversely, a bearish trend is depicted when the price crosses below the signal line.

The indicator is, however, recommended to be used in the company of other trading indicators for better trade entries/exits. Besides, you may also use it along with price action, which is even better. Suffice it to say that the above signals were generated with the indicator in sync with price action.

BUY Setup: Firstly, wait for the price to be above the signal line of the indicator, then open a BUY/LONG position after price action also confirms the upward move. From the above example, the price was already above the signal line, but it wouldn’t be advisable to take a BUY entry at that point. You need to wait for price action to validate the setup (e.g. bullish engulfing candle) before opening a BUY entry.

SELL Setup: The same principle applied for the above BUY setup is also applicable for the SELL setup. Firstly, wait for the price to go below the signal line. Open a SELL/SHORT entry upon confirmation by price action.

Take Profit and Stop Loss are discretionary to every trader. So ensure they are realistic. In addition, you may also trail your profits once a trade moves in your favor. Regardless, trailing profit has its pros and cons though.

Conclusion
The Laguerre Filter indicator for MT4 is a great trading tool that can potentially improve your trading. It is chart-friendly and doesn’t interfere with the candlesticks on your chart. Finally, the indicator is free to download.