Market Facilitation Index (BW MFI)
Market Facilitation Index Technical Indicator (BW MFI) is the
indicator which shows the change of price for one tick. Absolute values
of the indicator do not mean anything as they are, only indicator
changes have sense. Bill Williams emphasizes the interchanging of MFI
Market Facilitation Index increases and volume increases — this
points out that: a) the number of players coming into the market
increases (volume increases) b) the new coming players open positions
in the direction of bar development, i.e., the movement has begun and
picks up speed;
Market Facilitation Index falls and volume falls. It means the market participants are not interested anymore;
Market Facilitation Index increases, but the volume falls. It is
most likely, that the market is not supported with the volume from
clients, and the price is changing due to traders’ (brokers and
dealers) "on the floor" speculations;
Market Facilitation Index falls, but the volume increases. There is
a battle between bulls and bears, characterized by a large sell and buy
volume, but the price is not changing significantly since the forces
are equal. One of the contending parties (buyers vs. sellers) will
eventually win the battle. Usually, the break of such a bar lets you
know if this bar determines the continuation of the trend or annuls the
trend. Bill Williams calls such bar "curtsying".
To calculate Market Facilitation Index you need to subtract the
lowest bar price from the highest bar price and divide it by the volume.
BW MFI = RANGE*(HIGH-LOW)/VOLUME
RANGE — is the multiplication factor, which brings the difference in points down to whole numbers.
Full MQL4 source of Market Facilitation Index is available in the Code Base: Market Facilitation Index
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