The Waddah Attar explosion indicator is a well known indicator in the forex community all over the web. It builds on MACD together with Bollinger Bands and measures the current direction and strength in market. This indicator can act as a scalper on lower timeframes e.g. 30M - 4H but also does a pretty decent job as volatility filter to determine strong trending movements on higher timeframes like 1D. Example code can be found at https://www.prorealcode.com/prorealtime-indicators/waddah-attar-explosion/.
General Usage
The colored histogram visualizes the strength of the trend (green = bullish, red = bearish). A buy/sell signal is triggered when the (green/red) histogram bars rise above the explosion line. An exit signal is triggered if the bar falls below the explosion line.
Alerts
Traders can easily use the reversal signal to trigger alerts from:
Enter Long
Enter Short
Exit Long
Exit Short
Maintain Long
Maintain Short
Those values are > zero if a condition is triggered. Alert condition example: "Enter Long" - "Greater Than" - "0"
Moving Averages
16 different Moving Averages are available for calculation of both MACD and BB components:
ALMA (Arnaud Legoux Moving Average)
DEMA (Double Exponential Moving Average)
EMA (Exponential Moving Average)
FRAMA (Fractal Adaptive Moving Average)
HMA (Hull Moving Average)
JURIK (Jurik Moving Average)
KAMA (Kaufman Adaptive Moving Average)
Kijun (Kijun-sen / Tenkan-sen of Ichimoku)
LSMA (Least Square Moving Average)
RMA (Running Moving Average)
SMA (Simple Moving Average)
SuperSmoothed (Super Smoothed Moving Average)
TEMA (Triple Exponential Moving Average)
VWMA (Volume Weighted Moving Average)
WMA (Weighted Moving Average)
ZLEMA (Zero Lag Moving Average)
A freely determinable length allows for sensitivity adjustments that fits your own requirements.
Such a masterpiece. I love this! Sometimes the arrows don't show up even thought the volume is above the explosion line. Is there a reason?
lcastilloe
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nice work! one question why the dead zone line/feature has been removed? can it be implemented?
stinkbug
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any indication which moving avg is best to use, or what does the original one use as its default?
UberTradingSystems
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@stinkbug, that absolutely depends on your own trading approach, the time frame and also the asset you trade.
But in general with the default settings you are good to go (for defaults just hit reset in the settings window). Then you backtest and tweak further.
You can also checkout my WAE backtest strategy
tradingview.com/script/kLXR8pon-Strategy-Backtest-Uber-WAE-Waddah-Attar-Explosion-UTS/ but thats not mandatory for backtesting as it can be done manually.