Market Facilitation Index

Market Facilitation Index measures how much price range the market produced for each unit of trading activity: MFI = (High - Low) / Volume. On its own that is just a ratio. Bill Williams' contribution was to read it alongside the change in volume from the previous bar, which splits every bar into one of four states: Green - MFI up and volume up: the move is being driven by fresh participation, the healthiest state for a continuation. Fade - MFI down and volume down: interest is drying up along with the range, a bar that usually deserves no attention. Fake - MFI up and volume down: range expanded on falling participation, a move some traders read as more likely to reverse. Squat - MFI down and volume up: heavy participation produced very little range, often read as absorption ahead of a move. Each state is drawn from its own histogram buffer and colour so the four-way read is immediate without needing a legend lookup. Tick volume is used as the volume input, since true traded volume is not available from most MT4 forex feeds; on symbols where tick volume is not a reasonable proxy for participation (illiquid CFDs, some synthetic instruments) the classic four-state read should be treated with more caution. Notes and limitations - Uses tick volume, not true traded volume - MT4 forex feeds generally do not provide the latter. - A bar with zero tick volume leaves MFI undefined for that bar and is drawn empty rather than guessed. - This is a classification of past bars, not a signal generator - it does not draw arrows or fire alerts.

Indicator · MT5 · v1.0 · Free

Tags: Volume · MT5 Indicator · MQL5 Source Code

MetaTrader 4 & 5 indicators · PolyMaria