Cycle Identifier Indicator

Cycle Identifier Indicator
MT4Also Available for MT5

The Cycle Identifier indicator for MT4 generates filtered price action signals to assist traders to identify when the conditions are right to open buy and sell positions.

The Cycle Identifier MT4 indicator is a great choice of custom indicator for both short-term and long-term traders. The Cycle Identifier MT4 generates filtered price action signals to assist traders to identify when the conditions are right to open buy and sell positions.

How it works
The Cycle Identifier MT4 indicator displays on a separate indicator chart below the main chart where it draws an oscillating gray line. This gray line is characterized by upward and downward spikes that are accompanied by green and red bars respectively to show the market trend and trend momentum.

In the background, the indicator uses a combination of the Smooth Moving Averages (SMA), Relative Strength Index (RSI), and Price Action Filter indicators. This enables the indicator to identify the market trend, analyze its strength (momentum) and also filter out false signals.

Short-term traders using the Cycle Identifier indicator should use the lower timeframes while long-term traders should use the higher timeframes.

For example, those using the scalping strategy should use the indicator on the M1 timeframe while those doing intraday trading can use the M5 or M15 timeframes. Swing traders can also use the Cycle Identifier and use the H1, H4, or D1 timeframes.

Interpreting Cycle Identifier Indicator signals
Signals generated by the Cycle Identifier Indicator are easy to follow.

If you look at the above H1 Metatrader 4 chart, you shall notice the Cycle Identifier Indicator MT4 indicator is displayed on an indicator chart below the main chart. You can see the gray line that oscillates about the 0.00 line.

If you look closely, you shall notice that some bars are plotted whenever there is a spike on the gray line. Lime and dark green bars are plotted when there is a spike below the 0.00 line while red and maroon bars are plotted when there is a spike above the 0.00 line. You shall also realize that the thickness of these bars differs; there is a time when the bars are thin and other times when the bars are thick and very conspicuous.

These red and maroon bars signal a bearish trend while the lime and dark green bars signal a bearish trend. However, the trend movements signaled by the maroon and dark green bars are too small to warrant placing trades. The thick red and lime bars are the ones that signal the significant trend movements that warrant placing trades.

A thick red bar signals a strong bearish trend where a trader should open a sell trade
A thick lime bar signals a bullish trend where a trader should open a buy trade
If you have an open buy position, it is always advisable to close it whenever a red or maroon bar appears. Similarly, if you have an open sell position, it is always advisable to close it whenever a lime or dark green bar appears.

Conclusion
Using the Cycle Identifier MT4 indicator to trade enables traders to identify when the right conditions for placing buy and sell orders are met.

The indicator is simple to use and can be used by both forex trading beginners and professionals.