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Note: This download requires NinjaTrader 8 release 8.1.3 or newer.

The Deviation Scaled MA (Moving Average -DSMA-), created by John Ehlers, represents an innovative approach to moving averages, akin to the functionality of the exponential moving average but with enhancement. Its adaptability stems from a dynamically calculated alpha coefficient, which adjusts based on the rate of price changes of the financial instrument in question. This feature allows the DSMA to offer a more responsive reflection of market trends.

When used in conjunction with a standard moving average or a similar adaptive moving average with slower period, the DSMA could serve as an effective fast signal, providing traders with timely insights into potential market movements. As with all adaptive moving averages, hugging the price action could result in many false signals if not used in a crossover environment or in combination with other momentum studies.

The internals of this indicator require Ehlers Super Smoother Filter, so it is packaged with it.

 Review the screenshots for setup options for the deviation Scaled MA. 

Frequently Asked Questions about the Deviation Scaled MA for NinjaTrader

What makes the Deviation Scaled MA different from standard moving averages?

The Deviation Scaled MA is an adaptive moving average with a dynamic alpha coefficient that adjusts based on price changes. This feature makes it more responsive than traditional moving averages, providing a more accurate reflection of market trends.

Can the Deviation Scaled MA be customized?

Yes, the Deviation Scaled MA for NinjaTrader offers customizable settings. You can adjust the parameters to find the best configuration for your trading style and time frame.

Is the Deviation Scaled MA suitable for all types of trading?

The Deviation Scaled MA is versatile and can be used in various trading styles, from day trading to swing trading. Its adaptability and dynamic behavior make it suitable for different market conditions and asset types.

How do I use the Deviation Scaled MA in my trading strategy?

The Deviation Scaled MA can be used in a crossover environment with a standard moving average or a similar adaptive moving average with a slower period. This approach helps confirm signals and reduces the risk of false positives. Consider combining it with momentum studies to create a more robust trading strategy.

Should I use the Deviation Scaled MA alone or with other indicators?

It's best to use the Deviation Scaled MA in conjunction with other technical indicators. This multi-indicator approach helps confirm trading signals and enhances the reliability of your trading strategy. Consider using oscillators or other momentum-based tools to reduce false signals.

How do I customize the Deviation Scaled MA for NinjaTrader?

Customization depends on your trading style and objectives. Experiment with different settings to find the best configuration for your trading strategy. This flexibility allows you to adapt the DSMA to various market conditions and time frames.

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