MACD ATR Trading Guide

The MACD / ATR is an optimized blend of the classic Moving Average Convergence Divergence (MACD) indicator, normalized by the Average True Range (ATR) to adjust the oscillator's sensitivity dynamically according to market volatility.

What does the indicator show?

• MACD/ATR Line: The main oscillator line measuring the distance between fast and slow moving averages, normalized by volatility.
• Signal Line: A moving average of the MACD/ATR line, used for crossover signals.
• Histogram: Colored bars representing the difference between the MACD/ATR line and its Signal line, color-coded to show momentum acceleration or deceleration.

Key Settings

• Fast/Slow Length: The lookback periods for the short-term and long-term moving averages.
• Signal Length: The smoothing period applied to generate the Signal Line.
• ATR Length: The timeframe used to measure volatility normalization.
• Oscillator/Signal MA type: Choose between Simple (SMA) and Exponential (EMA) calculations.

How to use Strategy Parameters (Condition Source)

Within the Strategy Tester module, you can leverage the data from this indicator to catch momentum shifts and crossovers.

1. Momentum Lines & Histogram

Outputs tracking the raw oscillator values.

• MACD/ATR Line — The normalized primary oscillator curve.
• Signal Line — The smoothed trigger line.
• Histogram — The difference between the main and signal lines.

Strategy Example: A basic confirmation for an uptrend would be adding the condition: Histogram > 0.

2. Crossover Signals

Direct buy/sell events triggered by the lines crossing.

• Bull Cross — Triggers true when the main line crosses above the signal line.
• Bear Cross — Triggers true when the main line crosses below the signal line.

Strategy Example: To enter a Long trade precisely when momentum flips positive, use the condition: Bull Cross is_true.