Trade Stock Indices

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Adding MetaTrader 4 Accumulation/Distribution Indices Technical Chart Indicator

Step 1: Open the Indices Trading Platform Navigator Window

Open the Navigator window as shown below; Go to “View” menu (click), then select the “Navigator” window (click), or From Standard Toolbar click the “Navigator” button or press short cut keyboard keys “Ctrl+N”



On the Navigator window, select “Indicators”, (Double Click)

MetaTrader 4 Accumulation/Distribution Indices Indicator

MetaTrader 4 Accumulation/Distribution Indices Indicator


Adding Accumulation/Distribution MetaTrader 4 Indices Technical Chart Indicator

Expand the menu by clicking the expand button marker (+) or double click the “indicators” menu, after this the button will appear as (-) and will now display a list as shown below - select the Accumulation/Distribution stock indices chart indicator from this list of stock indices indicators so as to add the Accumulation/Distribution stock indexes technical indicator on the stock indexes trading chart.

From the Above window you can then place Accumulation/Distribution indicator that you want on the Indices Trading chart

From the Above window you can then place Accumulation/Distribution indicator that you want on the Indices Trading chart



How to Put Custom Accumulation/Distribution Stock Indexes Indicator on MetaTrader 4 and How to Install Accumulation/Distribution Stock Indexes Indicator MetaTrader 4

If the stock indices indicator you want to add is a custom indicator - for example if the Accumulation/Distribution indicator you want to add is a custom indicator you will need to first add this custom Accumulation/Distribution indicator on the MT4 stock indexes trading platform and the compile the custom Accumulation/Distribution indicator so that the newly added Accumulation/Distribution custom indicator appear on the list of custom indicators on the MetaTrader 4 stock indexes trading platform.


To learn how to install Accumulation/Distribution indicators on MetaTrader 4, how to add Accumulation/Distribution indicator window to MetaTrader 4 and how to add Accumulation/Distribution custom indicator on MT4 stock indexes trading platform - How to add a custom Accumulation/Distribution indices trading Indicator on MT4.



About Accumulation/Distribution Indices Indicator Tutorial


Accumulation/Distribution Indices Technical Analysis and Accumulation/Distribution Indices Trading Signals

Developed by Marc Chaikin


This indicator is used to assess the cumulative flow of money into and out of indices.


Originally used for stocks trading, when it comes to stocks trading “volume” is the amount of shares traded in a particular stock, this volume is a direct reflection of the money that is coming into and out of a stock.


The basic principle behind AD is that volume(or money flow) is a leading indicator of the indices price. (Volume precedes indices price).



Tick volume is the measure of stock indexes price changes (ticks) received by a indices broker during a particular trading period/interval. The tick volume is incorporated by many indices brokers in their charting software.


Interpretation


This volume indicator is used to determine if volume is increasing or decreasing as the stock indexes price on a stock indices chart is rising or falling.


Uptrend

If the stock indexes price on a stock indices chart is rising then the Accumulation/Distribution should also be rising. This shows that the stock indexes price move is being supported by volumes and the move upwards has strength and is sustainable.


If on the other hand stock indexes price is moving up and the volumes are not, the strength behind the move is reducing; this creates divergence between stock indexes price and indicator and warns of a possible move in the opposite direction.


Downtrend

If the stock indexes price on a stock indices chart is falling then the AD should also be falling. This shows that the stock indexes price move is being supported by volumes and the move downwards has strength behind it.


If on the other hand stock indexes price is moving down and the volumes are not, the strength behind the move is reducing; this creates divergence between stock indexes price and AD and warns of a possible move in the opposite direction.



Indices Technical Analysis and Generating Indices Trading Signals


Below is an example of a stock indices chart and the technical analysis explanation

Accumulation\Distribution Indices Indicator

From the chart above we can separate the chart into three parts, part A, B and C.


A - Upward indices trend line on chart as well as on the Accumulation/Distribution

B - Downward indices trend line on chart as well as on the Accumulation/Distribution

C - Upward indices trend line on chart as well as on the Accumulation/Distribution


As long as the stock indexes price and the indicator are moving in the same direction then the stock indexes price move has enough momentum to continue moving in that direction as shown above


Broker


Indices Trend Line Break

From the above chart we can see that once the indices trend line on the AD was broken then the stock indexes price indices trend line was also broken.


Looking at the chart below we have added vertical lines to represent the points where the indices trend lines were broken, both on the stock indexes price chart and the indicator.


Comparing the indices trend lines on the indicator and the stock indexes price those of the AD were broken before those of the chart. This is because volume always precedes indices price.


Indices Trend Line Break- Technical Analysis of Accumulation\Distribution indicator



Trading signals

Exit

Exit signals are generated when the indices trend line on the Accumulation/Distribution is broken. A indices trend line break on the indicator warns of a possible reversal.

Exit Signal


Entry

Once the indices trend line on the AD is broken it warns of a possible reversal in the direction of the stock indexes trading market.


However if we want to take a trade in the opposite direction it is always best to wait for a confirmation signal.


A confirmation signal is considered complete once both the indicator and the stock indexes price breaks both their indices trend lines.

Entry Signal - Generated by Indices Trend Reversal

Entry Signal Generated by Indices Trend Reversal

 

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