The Market Activity Index can be used best to visualize the alternating form of low and high volatile market. It is very useful tool to pick up the quiet market but ironically this is the powerful tool to predict the highly volatile market. Greatest thing about the Market Activity Index is that the reading of this indicator is bounded by its top (1.0) and bottom (0.0) limit but for the bottom limit will never diverge from actual price movements. It means that for the reading of 0.08 Market activity Index can’t be calculated from highly volatile price movement. To visualize how important this concept is, imagine that price can still go even further up even after the RSI reading indicates over 70 overbought signal (This can happen to 99% of oscillators.). The same thing can happen to ADX or most of technical indicators. For example, 25 reading of ADX can be still calculated even if there were quite extreme price movement before. One might say that these are false signal or lagging signal. Market Activity Index is not a magic indicator but it will do its job reliably notifying the quiet or sideways market period to traders most of time. This tool can help you to understand and learn the market rhythm.
Market Activity Index Indicator is useful for the complete volatility analysis for single currency pairs. Instead, you might prefer to monitor volatility of multiple instruments at the same time. In such a case, Market Activity Index Panel is recommended. With Market Activity Index Panel, you can monitor up to 21 currency pairs efficiently. You can readily spot the currency pairs entering sideways market across different time frame and across different symbols. Once you spot the currency pairs and time frame moving in sideways market, you can open the chart by one click on your panel.