What Is The Triangular Moving Average

The Triangular Moving Average (TMA) is similar to other moving averages in that it shows the average (or mean) price over a specified number of data points (usually a number of price bars).

Triangular Moving Average (TMA) Indicator

The Triangular Moving Average (TMA) is a momentum indicator and is very similar to other moving averages. However, the triangular moving average is double smoothed, meaning it is averaged twice. 

How To Calculate Triangular Moving Average (TMA) 

Formula:- SMA = (P1 + P2 + P3 + P4 + .. + PN) / N

TMA = (SMA1 + SMA2 + SMA3 + SMA4 + .. SMAN) / N =  SUM (SMA values)/N

Why Use Triangular Moving Average (TMA) 

The main reason traders use the Triangular Moving Average (TMA) is to double smooth the data, which produces a line on the chart that isn’t as sensitive as an SMA. The TMA can be advantageous or can pose problems, depending upon how it is used.

How to Use Triangular Moving Average (TMA) Trading Strategy

Bullish Scenario:- TMA moves similar to SMA, just smother. It is a lagging indicator, and the indication for a bullish scenario is also similar, i.e. if the value of TMA increases, it indicates that there is a bullish market for the commodity.

Bearish Scenario:- If the value of TMA decreases, it indicates a bearish market for the commodity.

Building The Triangular Moving Average (TMA) Trading Strategy in Mudrex

Strategy:- 

BUY:- TMA(30) crosses up TMA(90)

SELL:- TMA(30) crosses down TMA(90)

TIME FRAME:- 6Hrs

Creating on Mudrex:- 

We will use 2 TMA compare blocks. One for selling and One for buying.

For buying, we will use the following settings:-

For selling, we will use the following settings:-

Final Strategy:-

Testing:- 

Running on Binance Futures: BTC/USDT with tick interval of 6H yielded an overall profit of 216.68%

Links