The world of trading is full of indicators, yet not all provide concise, usable information. One such underutilized indicator is the Repulse Indicator. No matter whether you’re trading commodities, forex, or indices, this momentum indicator can assist you in identifying trend reversals and market sentiment with accuracy. Here’s a step-by-step on what it is, how it’s used, and why it might be added to your edge.
What is the Repulse Indicator?
The Repulse Indicator is a momentum oscillator that is used to monitor buying and selling pressure within the market. Unlike other oscillators that merely indicate overbought or oversold conditions, the Repulse Indicator measures the net demand over time. It informs traders about the strength and direction of a trend before it becomes apparent to everyone.
Initially designed to analyze markets for a larger context, it has now made itself a niche within forex traders who seek to know early on about reversal or continuation.
Repulse Indicator Formula
To have an idea of just how the Repulse Indicator works, understanding its formula first makes sense. Here’s the basic version:
Repulse = (Close – Open) / (High – Low)
This fundamental calculation is averaged over a defined interval (commonly 5, 15, or 33 bars) by means of a moving average. The objective is to quantify the pressure of bulls or bears over time.
A positive Repulse reading means buying pressure.
A negative reading means selling pressure.
The line of the indicator will normally oscillate above and below a midline zero point, which serves as a divide between bullish and bearish attitudes.
How to Use the Repulse Indicator in Forex Trading?
Spotting Trend Continuation
In an uptrending market, the Repulse Indicator can confirm the trend’s strength. For example:
If price is in an uptrend and the Repulse line remains above zero and rising, it confirms strong bullish momentum.
If the line starts to level off or decline, it may be a preliminary indication of exhaustion.
Identifying Reversals
Divergence is also a strong tool in this case. When the price establishes a higher high, but the Repulse Indicator is not able to do the same, it indicates weakening momentum and likely reversal.
Filtering False Breakouts
The Repulse can also be combined with the support and resistance levels. When price breaks a significant level but the Repulse is not supporting the same, then you may be facing a false breakout.
Repulse Indicator Strategy
One simple yet effective Repulse Indicator strategy is the trend continuation and divergence combo:
Settings:
Repulse Period: 15 (default)
Timeframe: H1 or H4 for forex
Entry Rules:
1- Establish the main trend (use a moving average if necessary).
2- Confirm the trend with the Repulse (above zero for uptrend, below for downtrend). Wait for price pullbacks.
3- Enter when Repulse reverts in the direction of the trend.
Exit Rules:
1- When the Repulse line crosses zero against your trade, then close the trade.
2- Or utilize a trailing stop.
3- This strategy assists you in entering trades in the direction of the trend and exiting prior to momentum loss.
Applying the Repulse Indicator on MT4
The Repulse Indicator MT4 variant is not a default built-in but can be easily found as a custom indicator. Upon installation, it will display in a sub-window and behave similarly to any other oscillator.
Installation Steps:
– Download the.ex4 or.mq4 file.
– Launch MT4 and navigate to File > Open Data Folder.
– Copy the indicator in the “Indicators” directory.
– Restart MT4.
– Add the Repulse Indicator to your chart.
While in operation, you can also adjust the smoothing time, color, and level. The most crucial level is the zero line.
Combination with Other Indicators
While the Repulse Indicator is formidable on its own, its use with other tools improves accuracy. The following suggestions can be considered:
Moving Averages: As confirmation of direction in trend.
RSI or MACD: As confirmation of momentum.
Support & Resistance Zones: To filter entries.
This makes the Repulse one of the Most Accurate MT4 Indicators when used in combination.
Pros and Cons of the Repulse Indicator
Pros:
Clean visual indication of buying/selling pressure
Effective for both trend and reversal trades
Operates on multiple timeframes
Easy to read and understand
Cons:
Not effective as a stand-alone tool
Needs smoothing for optimal performance
Needs custom installation on MT4
Real-Life Application: Forex Trading with Repulse
The pair has been in an uptrend, and the Repulse is consistently above zero. After a brief pullback, the Repulse begins rising again, confirming renewed buying interest.
You go long at the pullback low, place a stop below near-term support, and target the next resistance area. The Repulse remains positive all the way to the target, making you hold with conviction until your objective is reached.
Pro Tips
Use the Repulse on longer timeframes (H1 and above) for better-quality signals.
Don’t depend on it entirely—pair it with price action or another indicator.
Take advantage of divergence setups during important market events.
Frequently Asked Questions regarding Repulse Indicator
What is the use of the Repulse Indicator?
It is used to signal buying or selling pressure in the market. It’s used to confirm trends or identify potential reversals based on market psychological forces.
How is the Repulse Indicator calculated?
The Repulse Indicator core formula includes price levels (open, close, high, low), averaging, and then smoothing with an EMA. It produces a line that fluctuates around zero to indicate sentiment power.
Is Repulse suitable for forex trading?
Yes. Repulse Indicator use in forex is extremely robust. It assists with identifying entry and exit points by indicating where the pressure is piling up. It is used on all main pairs and all timeframes.
How to install Repulse Indicator on MT4?
You can download it in a few MT4 custom libraries or manually import the .mq4 file. Then, drag it to your chart from the “Navigator” window.
Is Repulse Indicator superior to RSI or MACD?
They are used for various purposes. RSI identifies overbought/oversold; MACD tracks momentum. The Repulse is used for pressure, which can lead to or lag the price based on settings. Many trade it with these for a complete picture.
What is the most appropriate time frame for the Repulse Indicator?
There is no one-size-fits-all. Scalpers like M5 or M15, swing traders like H1 or H4. Daily timeframes provide the clearest picture for long-term trades.
