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(VOLUME) MFI (Market Facilitation Index) <Part 2>

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  • (VOLUME) MFI (Market Facilitation Index) <Part 2>

    This is the continuation of my series on Market Facilitation Index (MFI forex indicator), see this link for the first part here *********Click here********* or

    In this part, we will be looking basically at what the color blue and color pink bars means and how to trade or not to trade when the are noticed.

    *Fake (Blue colored bar)- Volume is low and price moves are on the increase:

    Anytime a blue (fake) bar appears, it means strong moves could be triggered by mere speculation and may certainly not last long. It is best to avoid entering any new trade at this point in time.

    The blue (fake) bar also appears when there is any disconnection between volume of trade and price moves. This signals the observed strong moves may be as a result of a one-off speculations having the privilege to push in and around illiquid markets. Any price move at this point is most likely not to last long.

    Traders with much experience tend not to get into the market during this uncertain phase and this unfortunately is the time most new traders get sucked up in the market and experience heavy loss.

    Squat (Pink colored bar) signals movement or prices are shrinking and volumes are up:

    When the pink (squat) bar appears, it suggests that there is a high level of enthusiasm among traders to enter into the market, but it's a tough battle, compared to that of the Elephant and Lions. This signals that there is no clear price direction yet.

    After this struggle between the buyers and sellers, a winner emerges, prices tend to experience a sharp powerful move and the traders have the advantage to make quick profit from situations like this. Nonetheless, the indicator doesn't determine the exact direction for you.

    In the end, it all depends on your ability to make accurate and calculative choices from the predictions of the MFI and enjoy an uninterrupted profit from trade after trade. Good to note is the fact that the Market Facilitation Works brilliantly on all time frames, ranging from 5-minutes to daily trends and weekly charts.
    This is because the MFI measures market cycles and can be utilized in all market conditions.