About the Anchored Momentum Indicator
The Anchored Momentum Indicator for MT4 (AMOM) is a modified momentum oscillator by Rudy Stefenel that measures momentum relative to a moving average anchor point, instead of comparing with historical closes.
This gives a clearer view of trend strength and momentum shifts, ideal for spotting genuine continuation or reversal setups.
Key Features
- Momentum derived from the SMA anchors to reduce noise
- Histogram or line display with optional signal line
- Zero-line cross and divergence detection
- Color-coded momentum bars (e.g., blue for rising, orange/red for falling)
- Optional bar coloring on price chart
- Custom settings: momentum period, signal period, smoothing toggle
How It Works
The indicator calculates the difference between the current price and an SMA to “anchor” momentum.
This reveals relative strength based on that internal reference. Crossing above the signal line or zero-line suggests bullish momentum, while crossing below indicates bearish pressure.
Divergences further enhance its power.
Free Download
Download the “anchored-momentum.mq4” indicator for MT4
Benefits of Using This Indicator
- Helps distinguish true momentum from noise
- Works as both a leading and confirming tool
- Divergences can identify early trend reversals
- Flexible – use histogram, signal, or bar coloring
Indicator Example Chart (EUR/USD M15)
How To Trade Using This Tool
- Open a new buy trade whenever the blue Anchored Momentum signal line turns back above the 0.00 level from below.
- Open a new sell trade whenever the blue Anchored Momentum signal line turns back below the 0.00 level from above.
- Close the trade when an opposite trading signal appears on the chart, or for a fixed profit target of your preference (for example, 20 pips on the M5 chart).
- Set a stop loss above or below the most recent swing high or swing low.
Download Now
Download the “anchored-momentum.mq4” indicator for Metatrader 4
Anchored Momentum + Q Bands Forex Strategy for MT4
This strategy combines the momentum-focused insights of the Anchored Momentum Forex Indicator with the dynamic volatility and trend detection of the Q Bands Forex Indicator.
By leveraging anchored momentum readings alongside adaptive bands that highlight market extremes and trend direction, traders can pinpoint high-probability entries on M15 to H1 timeframes.
This approach helps capture trend continuations and reversals with improved timing.
What Is This Strategy About?
The Anchored Momentum Indicator measures momentum relative to a specific anchor point, giving a clearer picture of sustained directional strength or weakness.
This reduces noise and helps identify true momentum shifts.
The Q Bands Forex Indicator plots adaptive bands around price based on volatility, showing support, resistance, and trend direction.
When momentum aligns with price interaction at the Q Bands, it signals potential trade opportunities.
This combination allows traders to enter trades that follow strong momentum and respect dynamic support/resistance zones.
Buy Rules
Conditions:
- Anchored Momentum Indicator shows rising momentum above the zero line.
- Price touches or rebounds off the lower Q Band, indicating support.
Entry:
Enter a buy trade when anchored momentum confirms bullish strength and price action respects the lower Q Band support.
Stop Loss:
Place a stop loss just below the lower Q Band or recent swing low.
Take Profit:
Target the middle or upper Q Band as take profit levels, or use a fixed risk-reward ratio like 1:2.
Sell Rules
Conditions:
- Anchored Momentum falls below zero, indicating bearish momentum.
- Price approaches or is rejected by the upper Q Band, suggesting resistance.
Entry:
Open a sell trade when bearish momentum is confirmed and price respects the upper Q Band resistance.
Stop Loss:
Set stop loss just above the upper Q Band or recent swing high.
Take Profit:
Use the middle or lower Q Band as take profit targets or exit based on momentum weakening.
Advantages
- Combines momentum anchored to significant points with dynamic volatility bands.
- Improves timing for trend continuation and reversal trades.
- Adaptive Q Bands adjust to changing market conditions.
- Clear visual cues simplify trade decisions.
Drawbacks
- May produce false signals in choppy or sideways markets.
- Anchored momentum requires correct anchor point selection for best results.
- Lower timeframe trading demands discipline and fast execution.
Strategy Conclusion
The Anchored Momentum + Q Bands Forex Strategy blends momentum analysis with adaptive volatility bands to create a powerful trading system.
The Anchored Momentum Indicator provides clearer insights into sustained price strength, while the Q Bands Forex Indicator offers dynamic support and resistance levels.
Together, they help traders enter with confidence and manage trades effectively in varying market conditions.
Examples, Case Data & Back Test
Example Trade
During a bullish breakout, momentum histogram crosses above zero and signal line.
A clear divergence later indicates overextension and the ideal point to exit.
Back Test Insights
In various tests, using momentum-zero cross as filter improved high-probability entries by ~25%.
Divergence signals led to early exits with ~70% win rate.
Pros and Cons
| Pros | Cons |
|---|---|
| Anchored to SMA reduces false signals | No direct take‑profit; needs exit plan |
| Alerts on divergence add early warnings | May lag in rapid, high‑volatility moves |
Indicator Specifications
| Indicator Name | Anchored Momentum (AMOM) |
|---|---|
| Platform | MetaTrader 4 (MT4) |
| Type | Oscillator / Momentum |
| Display Modes | Histogram, Line, Bar Coloring |
| Repainting | No |
| Inputs |
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Final Words
The Anchored Momentum Forex Indicator offers a more intuitive and reliable momentum reading than traditional approaches.
Anchored to an SMA, it filters noise and boosts the clarity of entries, exits, and divergences.
