The Chartmill Trend Indicator indicates whether a trend is positive, negative or neutral. The indicator is available in our charts as an overlay or as a standalone indicator:
Chartmill Trend Overlay
The overlay will be colored green when the trend is positive, red when it is negative or grey when it is neutral.
Chartmill Trend Indicator
The standalone indicator has a value 1 for a positive trend, -1 for a negative trend or 0 for a neutral trend. The same color code is used in the standalone indicator.
The indicator is meant to be used on a weekly time frame and measures the long term trend. It can also be used in the daily time frame to indicate shorter term trends.
The distinction between positive, negative or neutral is made by comparing the price to the position of the 30 week exponential moving average (30 EMA):
Although the trend indicator has a fairly simple formula for determining a trend, the example will show that the results are quite pleasing. We will have a look at the S&P 500 over the last 10 years by looking at the chart of SPY:
On the chart you can see that