How to Set Choppiness Index on MetaTrader 4 Charts - Adding MT4 Choppiness Index Indicator

Step 1: Open the Navigator Window on Trading Software Platform

Open the Navigator window just as shown & illustrated below: Go to 'View' menu (press on it), then select 'Navigator' window (press), or From Standard ToolBar click the 'Navigator' button or press key board short-cut keys 'Ctrl+N'

On Navigator panel, choose 'Indicators', (DoublePress)

How to Set Choppiness Index in the MetaTrader 4 - How Do You Use Choppiness Index Indicator?

How to Set Choppiness Index Trading Indicator on the MT4 - MT4 Choppiness Index Indicator

Step 2: Expand the Indicators Menu on the Navigator - Adding Choppiness Index MT4 Indicator

Expand the menu by clicking the protract button/tool function " + " or double-click the 'indicators' menu, after that this particular button will appear and be shown as (-) & will now display a list as shown below - select the Choppiness Index chart indicator from this list of trading indicators so as to add the Choppiness Index to the chart.

How to Set Choppiness Index on a Chart - How to Use Choppiness Index Indicator

How to Set Choppiness Index - From the Above window you as a trader can then place Choppiness Index that you as a trader want on the chart

How to Set Custom Choppiness Index to MT4

If the indicator you want to add is a custom indicator - for example if the Choppiness Index you as a trader want to add is a custom indicator you'll need to first add this custom Choppiness Index on the MetaTrader 4 software and then compile the custom Choppiness Index so that as the newly added Choppiness Index custom indicator pops up on the list of custom indicators in MetaTrader 4 software.

To learn how to install Choppiness Index indicators on MT4, how to add Choppiness Index window to MT4 and how to add Choppiness Index custom technical indicator in MetaTrader 4 Platform - How to add a custom Choppiness Index on the MT4 Software.

About Choppiness Index Lesson

Choppiness Index Technical Analysis & Choppiness Index Signals

Developed by E.W. Dreiss

Choppiness Index was designed and built to be an easy but practical indicator to help the traders to determine if the prices are trending or consolidating.

This Indicator is similar to ADX which is also designed to measure the strength or momentum of a trend & determine if the market is trending or it is consolidating.

How Do I Use Choppiness Index Indicator? - How Do I Set Choppiness Index Trading Indicator on MetaTrader 4 Charts?

The Choppiness Index uses a scale of between 0 & 100. It also typically uses upper & lower bands at 61.8 and 38.2 respectively.

This indicator is plotted by first calculating the true range for each period & then adding the values of n-periods.

Second, it calculates the highest value & lowest value over n-periods & calculates their difference.

Third, it divides the sum of the true ranges and calculates the base-10 logarithm of this value.

Finally, it divides this value by the base-10 logarithm of n-periods & multiplies the results by 100.

Technical Analysis & Generating Signals

Choppiness Index is a directionless indicator meaning it doesn't determine which direction the market price is heading.

Its basic principle is that the more heavily the market is trending over the last number of n price periods the closer to zero the Choppiness Index will be and the more heavier the market is consolidating that's heading sideways in a ranging or choppy manner, over the last n periods the closer to 100 the Choppiness Index will be.

Indicator values of above 61.8 indicate that the market is ranging/ choppy (moving sideways & consolidating).

Higher values occur during/after a strong consolidation phase. Higher values could also be interpreted as a trade signal of a potential upcoming breakout after a significant consolidation has taken place.

Choppiness Index values of below 38.2 indicate the market is trending.

Lower values occur during/after a strong trending phase. Lower values could also be interpreted as a signal of a potential upcoming consolidation & choppiness after a strong trend phase has occurred.

More Courses:

Trade Forex Trading