The HighPass-LowPass Roofing Filter is a nifty tool designed by John Ehlers, as detailed in his book, Cycle Analytics For Traders (pg. 78). This indicator helps traders determine the direction of stock trends with ease.
So, how does it work? Simply put, if the indicator dips below 0, it signals a downtrend in the stock. Conversely, if it climbs above 0, you’re looking at an uptrend. A straightforward strategy is to buy when the indicator line turns green and sell when it shifts to red.
Now, if you're still using MetaTrader 4, I won’t be covering that version here, but you can grab it along with the source code through my Telegram channel. Make sure to subscribe to stay updated!
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