Mastering the True MFI: A Game-Changer for Your Trading Strategy

Introduction to the True MFI Indicator

Author: VladMsk

In the world of trading, price movements often come hand in hand with increased trading activity. This is where the True MFI (Money Flow Index) indicator steps in, aiming to leverage this relationship. Unlike the traditional MFI that primarily relies on price for its calculations, the True MFI takes a different approach. It uses price to determine the direction of the movement while incorporating volume to gauge the strength of that movement.

Why Choose True MFI Over Standard MFI?

The standard MFI is somewhat akin to the Relative Strength Index (RSI), which can make it less appealing for traders seeking unique insights. The True MFI, however, stands out by combining both price and volume data, offering a more comprehensive view of market dynamics. As with most indicators, the effectiveness of the True MFI tends to improve as you increase your timeframe.

Technical Insights

The True MFI indicator utilizes classes from the SmoothAlgorithms.mqh library. If you're interested in diving deeper into how this class works, check out the article "Averaging Price Series for Intermediate Calculations Without Using Additional Buffers".

History and Development

This innovative indicator was first developed in MQL4 and made its debut on the Code Base back on June 15, 2010. Since then, it has gained traction among traders looking for an edge in their analysis.

Visual Reference

Fig.1 The True MFI indicator