Hey there, fellow traders! Today, we're diving into the Hull Moving Average (HMA) and how using an Exponential Moving Average (EMA) can enhance your trading strategies.
The original Hull Moving Average is based on the Linear Weighted Moving Average (LWMA). However, one common issue traders face is that it can overshoot, leading to false signals.
So, what’s the fix? By tweaking the calculation method, we can improve the reliability of the HMA.
This updated version:
- Utilizes EMA for its calculations, which helps prevent overshooting while still keeping signals in the same general area.
- Includes an additional “speed” parameter, allowing you to filter signals more effectively without altering the Hull period.
How to Use It:
- Look for color changes in the HMA as signals for potential trend reversals.
With the HMA using EMA, you're better equipped to spot trends without the noise that can lead you astray. Give it a try and see how it fits into your trading toolkit!
Happy trading!
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