The Dinapoli Stochastic indicator designed for Metatrader 5 combines the Dinapoli + Stochastic indicators to accurately identify overbought and oversold levels in the market.
It is recommended to use this tool in conjunction with the overall market trend.
An example strategy can be found further down the page.
The indicator appears in a dedicated chart window as orange and purple colored lines that cross above and below the 70 and 30 threshold levels.
How to interpret the indicator?
- The market is considered overbought when the indicator reaches a value of 70.
- The market is considered oversold when the indicator reaches a value of 30.
The indicator allows customizing the following settings and parameters: stochastic period, line style.
Scalpers and intraday traders will likely benefit the most from this took during the London and New York trading session due to the increased market volatility.
It supports all time frames and Forex pairs.
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The picture below illustrates how the Dinapoli Stochastic indicator looks like when applied to the MT5 chart.
How To Buy And Sell Currency Pairs With The Dinapoli Stochastic Indicator?
Find a simple trading strategy below:
- Buy market condition: it is crucial for the market trend to demonstrate a clear uptrend.
- A buy signal is triggered when the Dinapoli Stochastic indicator crosses above the 30 oversold level from below.
- Place a stop order below 3 pips short-term support.
- Exit the buy trade for a risk to reward ratio of at least 1.5, or utilize your own take profit strategy.
- Sell market condition: it is crucial for the market trend to demonstrate a clear downtrend (see chart above).
- A sell signal is triggered when the Dinapoli Stochastic indicator crosses below the 70 overbought level from above.
- Place a stop order above short-term resistance.
- Exit the sell trade for a risk to reward ratio of at least 1.5, or utilize your own take profit strategy.
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Frequently Asked Questions
How Do I Install This Custom Indicator On Metatrader 5?
- Open the MT5 trading platform
- Click on the File menu button located at the top left part of the platform
- Click on Open Data Folder > MQL5 folder > Indicators
- Copy the dinapolistochastic.mq5 indicator file in the Indicators folder
- Close and restart the trading platform
- You will find the indicator here (Navigator window > Indicators)
- Drag the indicator to the chart to get started with it!
How Do I Edit This Indicator?
- Click in the open chart with your right mouse button
- In the dropdown menu, click on Indicator List
- Select the indicator and click on properties
- Now you can edit the inputs, colors, levels, scale and visualization
- Finally click the OK button to save the new configuration