Description:
Have you heard about the Market Flow Analysis Method (MFAM)? It’s a game-changer for traders looking to sharpen their price action skills. This method was introduced by Todd Mitchell, and while I don’t have any ties to him or his site, you can check it out for more insights at http://www.eminisuccessformula.com.
The MFAM program does a fantastic job of tracking the Highest Highs and Lowest Lows in the market, along with spotting potential trend changes. The bright Red and Green lines clearly mark the Highest High and Lowest Low, while the softer cyan and magenta lines represent the current Active High and Low. Keep an eye on these, as they could become the new highs or lows if a price break occurs.
The strategy is straightforward: go long when the price breaks above the Highest High and short when it dips below the Lowest Low. You’ll see the signal when the green line makes a jump upwards or the red line dips downwards.
If you want a deeper dive into the theory, there’s a handy PDF available for download at this link.
While I was developing the MFAM indicator, I started by tracking 'periods since the Highest High' on a separate chart. With just a minor tweak in the source code and a single parameter change, this can be easily replicated.
Additionally, there’s an option to set a limit on how long a Highest High or Lowest Low can remain active. This was intended to streamline the process, moving away from the use of four buffers, although that hasn’t been fully implemented yet.
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