What is Acceleration Indicator?

here

Acceleration indicator shows whether and by how much the momentum of the market is accelerating or decelerating. Acceleration indicator has predictive value for a technical analyst because it changes direction before the momentum, and the momentum changes direction before the market’s price. The Acceleration Indicator can therefore provide a useful clue that a directional reversal is forthcoming and can also confirm when a trend seems likely to continue.

Acceleration indicator for metatrader

Acceleration Indicator measures acceleration and deceleration of the current driving force. This indicator will change direction before any changes in the driving force, which, it its turn, will change its direction before the price. If it is realize that Acceleration/Deceleration is a signal of an earlier warning, it gives you evident advantages.

Acceleration indicator histogram fluctuates around zero, where a zero reading indicates that the market’s momentum is balanced. A histogram reading greater than zero indicates that the momentum of the market is accelerating, while a level below zero indicates that the market’s momentum is decelerating.
Furthermore, the Acceleration indicator has two colors, usually red and green, that alternate.
When the Acceleration value of the current bar is greater than that of the previous bar, it is colored green, and when less than that of the previous bar, it is colored red.
When the indicator changes from green to red above zero, that indicates the acceleration of the momentum is slowing, but still positive. Conversely, when it changes from red to green below zero, that indicates the deceleration of the momentum is slowing, but still negative.

The nought line is basically the spot where the driving force is at balance with the acceleration. If Acceleration/Deceleration is higher than nought, then it is usually easier for the acceleration to continue the upward movement (and vice versa in cases when it is below nought). Unlike in case with Awesome Oscillator, it is not regarded as a signal when the nought line is crossed. The only thing that needs to be done to control the market and make decisions is to watch for changes in color.

We always wish your trading success. You are always welcome to share your thoughts, ideas and comments for the betterment of our website.