Ehlers MESA Adaptive MA Technical Analysis Signals

Mesa Adaptive MAs was developed by John Ehler

Originally used to trade commodities & stocks.

The MESA Adaptive average looks like two MAs. The difference is that the MESA moves in a staircase manner and not in a curved line like the Moving Average. The example below shows this indicator plotted on a price chart.

Ehlers MESA Adaptive Moving Average

The MESA Adaptive MA is a trend following indicator that adapts to price action movement based on the rate of change of price as measured by Hilbert Transform Discriminator. This indicator will generate a signal when the two MAs cross one another. Trades should be executed in direction of the MESA averages.

This method features a fast MA and a slow MA so that composite average rapidly follows behind the price changes & holds the average value til the next candle close occurs. This indicator is less prone to whipsaws compared with the original Moving averages. This is because of its formula used to calculate the rate of change in relation to the price movement.