Guppy Multiple Moving Average (GMMA) Indicator Explained

Related: Candlestick Indicator for Multiple Symbols - another powerful indicator for MetaTrader 5 traders.

Guppy Multiple Moving Average (GMMA) is an indicator that analyzes the relationships between groups of moving averages. Each group represents either traders or investors, offering insights into their behavior and interactions. This indicator helps traders understand chart dynamics to select optimal trading methods and tools. The GMMA is designed to interpret trend movement on daily or intraday charts.

Also recommended: Trend Indicator with Multiple Variations - similar indicator with strong performance on MetaTrader 5.

Implied trader activity is monitored using a set of short-term moving averages. Traders typically initiate trend changes, driving prices upward in anticipation of a shift from a downtrend to an uptrend. This activity is visualized through a group of 3, 5, 8, 10, 12, and 15-period exponential moving averages.

A trend persists when other buyers join the market. Long-term investors support strong trends. Investors generally take longer to recognize trend changes but eventually follow traders. Implied investor activity is tracked using a group of long-term moving averages, including 30, 35, 40, 45, 50, and 60-period exponential moving averages.

The GMMA indicator is applicable in six trading scenarios:

- Standard trend breakouts
- Joining a trend
- Utilizing price weakness
- Rally and trend breakout
- Selecting optimal exits
- Trading bubbles

The indicator supports various smoothing algorithms:

- Simple moving average
- Exponential moving average
- Smoothed moving average
- Linear weighted moving average
- JMA adaptive average
- Ultralinear smoothing
- Parabolic smoothing
- Tillson's multiple exponential smoothing
- Smoothing using Tushar Chande's algorithm
- Smoothing using Perry Kaufman's algorithm

It is important to note that phase1 and phase2 parameters have different meanings across various smoothing algorithms. For JMA, the phase variable ranges from -100 to +100. For T3, it is a smoothing ratio multiplied by 100 for better visualization. For Vidya, it represents the CMO oscillator period, and for AMA, it is the slow EMA period. These parameters do not influence smoothing in other algorithms. For AMA, the fast EMA period is a fixed value, defaulting to 2. The exponent ratio is also 2 for AMA.

This indicator utilizes classes from the smoothalgorithms.mqh library, which must be placed in the terminal_data_folder\mql5\include directory. The usage of these classes is detailed in the accompanying article.

Indicator input parameters:

You may also like: XR S X Indicator with Multiple Smoothing Algorithms - excellent alternative for indicator users on MetaTrader 5.

#property copyright "robotfx"
#property link "https://robotfx.org"
#property version   "1.00"
#property indicator_chart_window 
#define lines_sirname     "gmma" // line constant for the indicator name
#define lines_total         12   // the constant for the number of the indicator lines
#define reset                0   // the constant for getting the command for the indicator recalculation back to the terminal
#property description "this code is educational. feel free to use, modify and upgrade as you wish. visit robotfx.org for professional trading tools"
#property indicator_buffers lines_total 
#property indicator_plots   lines_total

.......

• 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.