The importance of trading in line with the overall market trend outweighs trading in an undefined market condition. Trading in the direction of the market trend makes technical analysis/trade entry less complicated and increases the chance of identifying a high-probability trade setup.
However, the financial market is dynamic, which makes some traders (e.g., beginners) need help to keep a tab on the ever-changing market trend. Therefore, the Super Trend Indicator is simply a MetaTrader 4 (MT4) trend analyzer developed to help traders keep a tab on the market trend. The indicator defines the market trend and detects trend reversal zones.
How does the Super Trend work on MT4?
The Super Trend indicator for MT4 displays a lime-colored line below the candlesticks when the market is in an uptrend. Therefore, it continually draws the Lime-colored line as long as the trend remains bullish. Similarly, a red line would be displayed above the candlestick, implying a downtrend.
Conversely, the indicator signals an imminent trend reversal when it paints an opposite line on the chart. In a bullish trend, for instance, a trader may look for a selling opportunity when the red line is displayed.
Features of the Indicator
The Super Trend indicator works with the past price action in the market to determine the market direction. It functions with the Average True Range (ATR) data and the moving average to define the market trend and spot reversal zones.
Furthermore, the indicator supports multi-time frame analysis. It also enables users to adjust the parameters to suit
Benefits of Using the Indicator
- Identifies Market Trend Direction: The Super Trend indicator shows the trend condition of the market, thereby assisting traders in decision-making.
- Confluence: The indicator can be combined with price action/other technical indicators to refine an entry zone to open a BUY/SELL position.
- Trade Management: The indicator also serves as a signal to trail a stop loss or close a running position. For instance, a trader may close a running trade when it signals a trend change, especially at a significant support/resistance level.
Indicator Description Settings
The indicator comes with the following customizable settings:
Nbr_Periods: This shows the period of the indicator.
Multiplier: Determines the distance between the indicator’s lines and the candlesticks.