The original MAD indicator is comprised of the difference of two simple moving averages. The length of the shorter moving average is determined by the desired smoothness of the indicator, and the length of the longer moving average is the length of the shorter plus the half-period of the dominant cycle in the data. The simple moving average uses a rectangular window in its generation, and the Fourier Transform of the sharp edges of this window lead to “sidelobe leakage” in its filter response. The solution to making a better average is to soften the sharp corners of the window. Ehlers nominated the Hann window having a cosine squared shape coefficient amplitude distribution across the length of the filter to be a proper compromise. The improved MAD filter is the combination of the two concepts above. That is, instead of taking the difference of two simple moving averages, the improved version takes the difference of two FIR filters that employ Hann windowing.
To add the tool to your chart, select the tool from the Ehlers tool group, and left-click on the chart to add the tool. Optuma will then draw the tool in a window below the chart using the default settings.
Actions & Properties
Copy Data to Clipboard: Will copy the tool’s values to the clipboard which can then be inserted into a spreadsheet, for example, allowing for further analysis.
Add to Toolbar: Adds the selected tool to your custom toolbar.
Apply Settings to All: When multiple Improved MAD tools have been applied to a chart, page or workbook, this action can be used to apply the settings of the one selected to other instances of the tool. This is a great time saver if an adjustment is made to the tool - such as line colour - as this allows all the other Improved RSI tools in the chart, page or entire workbook to be updated instantly.
Copy Tool: Allows you to copy the selected tool, which can then be pasted onto a different chart window.
Move to Back: If the tool is displaying in front of other tools or indicators clicking this action will move the tool view to the background.
Move to Front: If the tool is displaying behind other tools or indicators on the chart, clicking this action will bring the tool to the forefront.
Restore Default Settings: Click this action if you have adjusted the default settings of the tool, and wish to return to the standard properties originally installed with Optuma.
Save Settings as Default: If you have adjusted any of the tool’s properties (colour, for example) you can save the adjustments as your new default setting. Each time you apply a new Improved MAD to a chart, the tool will display using the new settings.
Delete: Deletes the tool from the chart.
Tool Name: Allows you to adjust the name of the tool, as it’s displayed in the Structure Panel.
Bars: Allows you to increase or decrease the number of bars that are used in the calculation.
Dominant Cycle: Allows you to increase or decrease the number of bars used to calculate the dominant cycle component of the Improved MADs calculation.
Plot Style Allows you to change how the Improved MAD is displayed on your chart. There are 6 options available: Line, Dot, Histogram, Step, Shaded, Shaded Step.
Line Style The Line Style property allows you to adjust the type of the line displayed. There are 8 options available: Solid, Dots, Dash, Dash Dots, Long Dash, Long Dash Dot, Long Dash Dot Dot, Stippled.
Line Width Allows you to adjust the width of the lines. Moving the slider bar to the right increases the thickness of the line.
Colour Scheme: Allows you to swap between different colour setups for the Improved MAD tool. Options include Copy Colours from Chart, Single Colour (default), Positive / Negative and Custom.
Line Colour Allows you to select the colour of the line. Clicking on the drop down arrow will display a colour swatch. Locate the desired colour and left-click it once to select it.
Zero Line Style: This option expands to show the following:
Line Style: The Line Style property allows you to adjust the type of the line displayed. There are 8 options available: Solid, Dots, Dash, Dash Dots, Long Dash, Long Dash Dot, Long Dash Dot Dot, Stippled.
Line Width: Allows you to adjust the width of the lines. Moving the slider bar to the right increases the thickness of the line.
Line Colour: Allows you to select the colour of the line. Clicking on the drop-down arrow will display a colour swatch. Locate the desired colour and left-click it once to select it.
Transparency: Use this slider bar to adjust the transparency of the Level lines. Moving the slider to the left will increase the transparency of the tool.
Offset: Moves the tool forward or backwards in time. The offset is measured in bars, so a value of 2 will push the tool forward 2 bars and -2 will move the tool back 2 bars.
Tool Transparency: Use this slider bar to adjust the transparency of the tool. Moving the slider to the left will increase the transparency of the tool.
Visible: Un-tick this checkbox to hide the tool from the chart.
Show In Price Scale: When selected the current Improved MAD value will be displayed in the Price Scale.