Dots Trend Indicator is a lightweight and visually intuitive trend-following indicator designed for both MetaTrader 4 and MetaTrader 5 platforms. Originally inspired by the 2006 indicator developed by TrendLaboratory, this tool helps traders quickly identify the current market trend direction directly on the main chart.

The indicator displays colored dots on the price chart to represent trend direction:

• Blue dots indicate a bullish (uptrend) market
• Red dots indicate a bearish (downtrend) market

Unlike many traditional indicators, Dots Trend Indicator does not rely on standard MetaTrader indicators such as RSI, MACD, or ADX. Instead, it internally uses a call to the iMA() (Moving Average) function to retrieve price values based on the selected applied price (Close, Open, High, Low, Typical, etc.).

The core calculation is based on the cosine of the angle of price movement, allowing the indicator to evaluate the direction and momentum of price changes in a smooth and efficient manner. This mathematical approach helps reduce noise while maintaining responsiveness to trend shifts.

Dots Trend Indicator is fully customizable, enabling traders to adjust its behavior according to their trading style, timeframe, and market conditions. It works equally well for scalping, intraday trading, and higher-timeframe trend analysis.

Input Parameters
The indicator provides several adjustable parameters for fine-tuning performance:

• Length (default: 10)
  Defines the calculation period. Higher values result in smoother signals with fewer false entries but introduce more lag.
• AppliedPrice (default: PRICE_CLOSE)
  Specifies which price type is used in calculations (Close, Open, High, Low, Typical, etc.).
• Filter (default: 0)
  A powerful parameter designed to filter out sudden price spikes without adding significant lag. Increasing this value helps reduce false signals.
• Deviation (default: 0)
  Shifts the indicator vertically on the chart for better visual alignment.
• Shift (default: 0)
  Shifts the indicator horizontally on the chart.

Trading Strategy Example
A commonly recommended strategy is to wait for two consecutive dots of the same color before entering a trade in the direction of the trend. This approach helps confirm trend consistency and reduces premature entries.

However, like all trend-following tools, the indicator may occasionally produce false signals, especially in ranging or choppy markets. In some cases, entering a trade after a single dot signal, combined with a properly adjusted Filter parameter (for example, set to approximately three times the spread of the currency pair), can offer a more responsive trading approach.

As always, effective risk management, including stop-loss placement and position sizing, is essential when using this indicator.

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