The SuperTrend Indicator is a great way to identify the current market trend. The indicator shows a clear distinction between uptrends and downtrends. When the indicator is flat and flipping from above to below it shows that there is no trend at the present time.
Trend followers can use SuperTrend on the daily timeframe to identify the main trend and then use the 8 hour or 4 hour chart to identify trade entry opportunities.
YouTube Video – How to Calculate the SuperTrend Indicator in Excel
The SuperTrend indicator is calculated by using the ATR to offset the indicator from the average price. When the price touches the SuperTrend line it turns over to the other direction. One of the great things about the SuperTrend is that it only moves in the direction of the trend.
If you are interested in calculating the SuperTrend I have recorded a video showing how it can be done in Excel.
Upper Band Basic O24 =((D24+E24)/2)+($O$3*N24)
Lower Band Basic P24=((D24+E24)/2)-($P$3*N24)
Upper Band Q24 =IF(OR(O24<Q23,F23>Q23),O24,Q23)
Lower Band R24 =IF(OR(P24>R23,F23<R23),P24,R23)
SuperTrend S24 =IF(AND(S23=Q23,F24<=Q24),Q24,IF(AND(S23=Q23,F24>=Q24),R24,IF(AND(S23=R23,F24>=R24),R24,IF(AND(S23=R23,F24<=R24),Q24,””))))
How to Backtest a Trading Strategy in Excel
If you are interested in programming indicators and using them to backtest your own trading strategies, check out my Ebook course on Backtesting Your Own Trading Systems. The course is available though the Amazon Kindle Bookstore.