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Key Takeaways

Difficulty:Advanced
Reliability:Moderate
Category:volatility
Timeframes:Daily, Weekly

Mass Index

volatilityšŸ“Š Daily, Weekly

Identifies potential reversals by measuring range expansion and contraction.

Formula

Code
Mass Index = Ī£(EMA(H-L, 9) / EMA(EMA(H-L, 9), 9)) for 25 periods

Detailed Explanation

Mass Index measures the range between high and low prices to identify reversals.

**Reversal Bulge:** 1. Mass Index rises above 27 2. Then drops below 26.5 3. Signals potential trend reversal

Parameters

EMA Period
Default: 9
EMA smoothing
Sum Period
Default: 25
Summation period

šŸ“ˆ Bullish Signals

Reversal bulge in downtrend signals potential bottom

šŸ“‰ Bearish Signals

Reversal bulge in uptrend signals potential top

Python Implementation

Mass Index calculation

Python
import pandas_ta as ta
df['Mass_Index'] = ta.massi(df['high'], df['low'], fast=9, slow=25)

TradingView Pine Script

Try on TradingView
JavaScript
//@version=5
indicator("Mass Index")
ema1 = ta.ema(high - low, 9)
ema2 = ta.ema(ema1, 9)
mass = ta.sum(ema1 / ema2, 25)
plot(mass, "Mass Index", color=color.blue)
hline(27, "Bulge Upper")
hline(26.5, "Bulge Lower")
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MT5 MQL5 Code

C++
// Custom implementation needed

Python Libraries

pandas-ta
Technical analysis
pip install pandas-ta

Common Mistakes

āœ—Trading every bulge without trend context
āœ—Using wrong threshold levels

Confirmation Signals

Trend direction
Price action
Volume

Best For

Reversal identificationRange expansion detectionSwing trading

šŸ’” Pro Tips

  • ā€¢Look for "reversal bulge" pattern
  • ā€¢Best on daily charts
  • ā€¢Combine with trend indicators for direction
Last updated: December 29, 2024

Educational Disclaimer

This content is for educational purposes only and does not constitute financial or investment advice. Trading involves significant risk and you may lose your capital. Always consult a licensed financial advisor before making investment decisions.

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Investopedia - Technical IndicatorsBabyPips - Technical IndicatorsMetaTrader 5 Docs

Frequently Asked Questions

Related Indicators

Relative Strength Index (RSI)

RSI measures the speed and magnitude of price changes, oscillating between 0-100 to identify overbought and oversold conditions.

Bollinger Bands

Consists of a middle band (SMA) and upper/lower bands set at standard deviations from the middle.

Average True Range (ATR)

Measures market volatility by calculating the average range between high and low prices.

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