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Traders' Tips from TASC Magazine
Volume-Weighted Macd Histogram

The article by David Hawkins in this issue, "Volume-Weighted Macd Histogram", has demonstrated how to make the Macd-histogram (Macdh) perform better by volume weighting it.

Using Indicator Builder, one needs to create the following indicators:

The volume-weighted moving average:

input
 Period:"Enter number of periods",52, 1, 500; 
end_input

 var
 Per0:=Period;
 Vwma:= 0;
 end_var

 Vwma:= (CumSum(V * C, Per0) / CumSum(V, Per0));

 return Vwma;

The volume-weighted exponential moving average:

input
 Period:"Enter number of periods", 22, 1, 500;
end_input

 var
 Per0:=Period;
 Vwema:=0;
 end_var

 Vwema:=(Mov(V * C, Per0, E)) / (Mov(V, Per0, E));

 return Vwema;

The volume-weighted MACD histogram:

input
 PeriodS:"Enter short period", 12, 1, 500;  
 PeriodL:"Enter long  period", 26, 2, 501;  
 PeriodSig:"Enter smoothing period", 9, 1, 200;
end_input

 var
 PerS:=PeriodS;
 PerL:=PeriodL;
 PerSig:=PeriodSig;
 LongMA:=0;
 ShortMA:=0;
 VMACD:=0;
 SignalLine:=0;
 end_var

 LongMA:=(PerL * Mov(V * C, PerL, E)) / 
 (PerL * Mov(V, PerL, E));  
 ShortMA:=(PerS * Mov(V * C, PerS, E)) / 
 (PerS * Mov(V, PerS, E));  
 VMACD:=(ShortMA - LongMA);  
 SignalLine:=Mov(VMACD, PerSig, E);


 return VMACD - SignalLine;
 



Download to import into Tradecision.

How to use this indicator in Tradecision:
  1. Click Download.
  2. Save this indicator in a safe location on your hard drive.
  3. Open Tradecision and in the Tools menu click Indicator Builder.
  4. In the Indicator Builder dialog, click Import, locate the saved file and then click OK.
The indicator will be added to the Custom Indicators list.
 
Volume-Weighted Macd Histogram
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