Momentum indicator Preti

Preti Momentum Indicator



Class: volatility
Trading type: intraday trading
Time frame: 5 min -1 day
Purpose: momentum trading
Level of aggressiveness: standard

“Preti Momentum Indicator” is based on price patterns detection after abnormal price changes. One of the patterns based on abnormal returns is as follows: after an abnormally strong rise / fall in price short-term momentum movement appears.

This indicator, using a specialized statistical technics, identifies moments of abnormal returns and generates trading signals based on momentum effect.

“Preti Momentum Indicator” displays buy / sell signals directly on the chart, which makes it very easy to understand and used even for beginners in trading and technical analysis.

Parameters of the indicator

To configure the indicator, the following parameters are provided:

- Period (default value is 21) - period of indicator. It is used to define normal returns.

- Dev (default value - 1) – Is used to detect abnormal returns. It defines levels of aggressiveness in trading signals. The bigger the value is the more conservative signals are generated

Rules of trading

The rules of trading are extremely easy. The appearance of a “sell” (sell signal) and “buy” (buy signal) on the chart is a signal to open appropriate position.