derivative

Related: derivative ht f - another powerful indicator for MetaTrader 5 traders.

in mathematics, the value of the derivative is calculated according to the following simple formula:
, (1)
where:

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x0 — current value of the argument,

x — value of the argument to the right of the chart,

f(x0) — value of the function at point x0,

f(x) — value of the function at point х.
in the original definition the difference between x and x0 is infinitesimal, i.e. the limit of the function is used. using the formula (1) it is possible to calculate the approximate value of the derivative using the fuction values, avoiding direct differentiation.
regarding the price chart, x0 is the current bar, and x is the upcoming bar, which will be formed after a number of chart periods. respectively, f(x0) is the price value on the current bar, and f(x) is the price value of the upcoming bar. we find that (1) contains two unknowns — f(x0) and f(x). since we do not have additional expressions which contain the same two unknowns, the solution of equation (1) in this case is absent.
known values must be taken as f(x) and f(x0) to make it possible to find the derivative f'(x0). for that purpose it is necessary to take a point to the left of the current bar as x0, and to designate the current bar as x. as a result, f(x0) and f(x) become certain values (prices at points x and x0 correspond to the price values visible on the chart).
although, the calculated value will characterize an area already known to a trader, in which the price growth or fall can be judged without the help of the derivative. in this case the useful information is not simply the value of the derivative, but the comparison of two values of the derivative at adjacent bars. in case the signs of the calculated values are different the price has passed an extremum. the type of the extremum can be easily determined using the combination of signs: transition from negative value to positive value is minimum, positive to negative — maximum.
the described principle of calculation of a derivative is implemented in the derivative indicator. as a result it displays the difference of prices between the examined bar and the bar spaced from the examined one by a number of bars set in the "delay" parameter.
the easiest way to use the indicator is this: the line crosses the zero level from below — you should buy, from above — you should sell.
originally this indicator has been written in mql4 and was first published in the on 09.09.2015.
fig.1. the derivative indicator

You may also like: xderivative st dev ht f - excellent alternative for indicator users on MetaTrader 5.

#property copyright "robotfx"
#property link "https://robotfx.org"
#property version   "1.01"
#property indicator_separate_window 
#property indicator_buffers 1 
#property indicator_plots   1
#property indicator_type1   draw_line
#property indicator_color1 clrcoral
#property indicator_style1  style_solid
#property indicator_width1  2

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• This tool is provided for educational and testing purposes only.
• Past performance does not guarantee future results.
• Trading involves substantial risk of loss. Use on a demo account first.
• Results may vary depending on market conditions, broker, and settings.
• We recommend thorough backtesting and forward testing before using with real funds.