The Dsl DMI Oscillator MT4 indicator is based on Wilder’s directional movement index but with a twist.
The Dsl DMI indicator fluctuates above and below the zero (0.00) line in a subwindow below the main activity chart.
The indicator draws green, red and grey lines.
Green lines: the trend is rising
Red lines: the trend is falling
Grey lines: the trend is flat or range-bound
This indicator is suitable for scalping, day trading, swing trading and position trading.
It’s an easy to trade indicator, even for absolute beginners.
Free Download
Download the “dsl_-_DMI_oscillator.mq4” MT4 indicator
Indicator Chart (EUR/USD H1)
The EUR/USD H1 chart below shows the Dsl DMI Oscillator forex indicator in action.
Basic Trading Signals
Trading signals from this indicator are very easy to understand and goes as follows:
Buy Signal: The Dsl DMI indicator must be trading above the zero line and draws the start of a green line.
Sell Signal: The Dsl DMI indicator must be trading below the zero line and draws the start of a red line.
Exit buy trade: Close buy trades when the indicator falls below the zero line or start drawing a red line (bearish reversal signal).
Exit sell trade: Close sell trades when the Dsl DMI indicator rises above the zero line or start drawing a green line (bullish reversal signal).
Tip: You can always use your own preferred method of trade exit.
DSL DMI Oscillator and Tunnel MA Indicator Forex Strategy for MT4
This MT4 strategy combines momentum confirmation with trend direction using the DSL DMI Oscillator MT4 Forex Signals Indicator and the Tunnel MA MT4 Forex Indicator.
The DSL DMI Oscillator generates signals based on momentum: a green line starting above zero indicates a buy, while a red line starting below zero indicates a sell.
The Tunnel MA shows the trend direction, where price above the MA is bullish and price below is bearish.
This strategy aligns momentum with the overall trend for higher probability trades, making it suitable for scalping and intraday trading on M5 and M15 charts.
Buy Entry Rules
- Confirm that the price is above the Tunnel moving average, indicating a bullish trend.
- Check the DSL DMI Oscillator: the line should start green above the zero line.
- Enter a buy trade at the close of the candle where the green line begins.
- Place a stop loss below the Tunnel MA or the recent swing low.
- Take profit at the next resistance level or when the DSL DMI line turns red.
Sell Entry Rules
- Confirm that the price is below the Tunnel MA, indicating a bearish trend.
- Check the DSL DMI Oscillator: the line should start red below the zero line.
- Enter a sell trade at the close of the candle where the red line begins.
- Place a stop loss above the Tunnel MA or the recent swing high.
- Take profit at the next support level or when the DSL DMI line turns green.
Advantages
- Combines trend direction and momentum for more reliable trades.
- DSL DMI signals help confirm entry timing.
- Tunnel MA clearly identifies the market bias.
- Works on multiple pairs and short intraday timeframes.
- A simple setup reduces analysis time and indecision.
- Suitable for both scalping and day trading.
Drawbacks
- Requires active monitoring due to fast M5 and M15 price movements.
- Stop loss placement is essential to avoid small retracement losses.
- Less effective during news-driven volatility spikes.
- Exits based on DSL DMI color change may lag slightly during reversals.
Example Case Study 1
On EURAUD M5, the price was above the Tunnel MA, confirming a bullish trend.
The DSL DMI Oscillator started a green line above zero, signaling a buy.
The trade was entered at candle close with a stop loss below the MA.
The currency pair moved steadily higher, and the trade was exited once the DSL DMI shifted to red, resulting in a 19 pip profit.
Example Case Study 2
On USDCAD M15, the price was below the Tunnel MA, indicating a bearish trend.
The DSL DMI Oscillator started a red line below zero.
A sell trade was entered at the close of the candle, with a stop loss above the Tunnel MA.
Price moved lower, reaching support levels, and the trade was closed when the DSL DMI turned green, locking in a 25 pip profit.
Strategy Tips
- Trade only in the direction of the Tunnel MA trend to reduce countertrend risk.
- Wait for the candle to close to confirm the DSL DMI color change before entering.
- Use M5 for faster scalps and M15 for more controlled intraday trades.
- Partial profit-taking is optional but let DSL DMI color change remain the main exit signal.
- Adjust stop loss to recent swings for better risk management.
- Maintain consistent position sizing to handle volatility efficiently.
- Practice patience and wait for all conditions to align before entering trades.
Download Now
Download the “dsl_-_DMI_oscillator.mq4” Metatrader 4 indicator
MT4 Indicator Characteristics
Currency pairs: Any
Platform: Metatrader 4
Type: chart pattern indicator
Customization options: Variable (DMI period, DMI smoothing period, Smoothing method, Signal period, Change color on) Colors, width & Style.
Time frames: 1-Minute, 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours, 1-Day, 1-Week, 1-Month
Type: Signals indicator
