Currency System Analysis, Vol. 2

The Trading System Lab in the August 2005 issue of Active Trader magazine introduced the Trend Strength indicator, which was designed to define trend strength and direction. The indicator compares the current closing price to several simple moving averages (SMAs). The greater the number of averages below the current closing price, the higher the indicators value and the stronger the uptrend. The greater the number of averages above the current closing price, the lower the indicators value and the stronger the downtrend.