Mnikolic Investment Technologies
intelligent investment technologies™
Mnikolic Investment Technologies
intelligent investment technologies™


TradeBuilder Classic 2019 Edition adds Accumulation/Distribution to its collection of technical analysis tools, bringing the total number of strategy-building indicators to 36. Accumulation/Distribution can be used standalone, in combination with other indicators, or as a signal filter in trend-following and scalping applications.



Featured market: Pound/Swiss (GBP/CHF) 30-minute chart: Double MA Cross, Bollinger Bands, Accumulation/Distribution


New integrated indicator: Accumulation/Distribution

As suggestive by its name, this volume-driven indicator was designed to measure sum accumulation (buying) and sum distribution (selling) of a security. A market whose volume is dominated by buyers is said to be accumulative, and conversely, market whose volume is dominated by sellers is said to be distributive. This indicator can be used as part of Volume-Price Analysis strategy, with the theory that volume should confirm price trends. Accumulation/Distribution line is cumulative and non-bounded (there is no minimum or maximum on the oscillator scale). It increases in value by current bar’s volume amount if current bar’s price is above prior bar’s price, and it decreases by current bar’s volume amount if current bar’s price is below prior bar’s price. Since the line is cumulative it can identify divergences between multi-bar trend and its underlying volume.


New Parameters

IndAD: Setting this parameter to true activates Accumulation/Distribution
UpLimitAD: Level that oscillator needs to cross over in order to qualify for a long signal. Range: cumulative, negative to positive infinity – varies per pair and time frame; higher time frames have wider ranges.
DownLimitAD: Level that oscillator line needs to cross over in order to qualify for a short signal. Range: cumulative, negative to positive infinity – varies per pair and time frame; higher time frames have wider ranges.


Long signal is issued when Accumulation/Distribution oscillator crosses above UpLimit value; short signal is issued when it crosses below DownLimit value.

Since A/D oscillator is cumulative and its vertical scale unbounded, meaning it spans from positive to negative infinity, understanding which Uplimit and Downlimit values to use requires adding Metatrader’s own Accumulation/Distribution indicator to the chart for visual reference. You can use 0 or any value you feel is important, as indicated visually by the added indicator. In the screenshot below, USD/JPY M5 strategy uses the level indicated by the white line.



Divergence: positive A/D values typically prevail during bullish markets and negative during bearish. If A/D line is showing negative divergence from price action it could be indicating that market is weak and preparing for a downward swing (see screenshot above). You could then use that A/D level for TradeBuilder crossovers in expectation of bearish trend.

A/D is best used in what Marko Nikolic calls Pierce-and-Reverse style strategies where you essentially break even/take small losses while price ranges/consolidates and ride the trend when it picks up. It is advisable to use stop-loss or trailing stop orders with A/D-based strategies in case price and volume diverge significantly for an extended period.

Accumulation/Distribution can be an effective filter when used as part of a trend-following strategy framework (e.g. Double Moving Average Cross, Bollinger Bands, Envelopes, etc.), because it validates price trend with volume. Think of it as variation on volume weighted price action.

A/D can be used with the OB/OS (overbought/oversold) mode, which means, you can use A/D’s oscillator extremes to capitalize on statistical outliers such as buy/sell pressure points (sudden spikes in A/D levels).


Application in Trend Following Strategies

The Euro/Swiss (EUR/CHF) 5-minute chart below demonstrates performance of a strategy based purely on Accumulation/Distribution without any additional indicators being compounded. Long signal is issued when A/D oscillator crosses above its UpLimit value; short signal is issued when A/D oscillator crosses below its DownLimit value.



The Dollar/Loonie (USD/CAD) M15 example below compounds Accumulation/Distribution with trend-following indicators, namely Double MA Cross, Bollinger Bands, RSI, and Money Flow, to filter signal clustering.



Below are additional strategies based on Accumulation/Distribution, used in combination with other TradeBuilder Classic indicators:


Aussie/Kiwi (AUD/NZD) 5-minute chart: Accumulation/Distribution + Ichimoku Kinko Hyo


Euro/Dollar (EUR/USD) 2-point Renko (fixed-price) chart: Accumulation/Distribution + Ichimoku Kinko Hyo



In the following example we see a failed set-up, due to divergence between price and volume. This underlines the importance of using Stop Loss orders when applying Accumulation/Distribution indicator, in case divergence occurs for a prolonged period of time. Furthermore, adding Take profit orders to your trades, would've turned some of the losers into winners.



Application in Scalping

Accumulation/Distribution is compatible with TradeBuilder Classic’s Global Overbought/Oversold (OB/OS) mode, intended for scalpers. When active, this mode allows select oscillators like Stochastic, RSI, CCI, Force Index, etc. to be used for volatility trading - a style of trading where one tries to capitalize on bursts of momentum, and over/under-valuation of price that ensues. This is typically done with pure momentum oscillators, but Accumulation/Distribution can also be used. Think of it as finding short term pressure points (volume x price). Selection of levels should be chosen as described above for trend following, except you would reverse values for Uplimit and DownLimit (e.g. UpLimit (long) at -50, DownLimit (short) at 50). Few words of caution in regards to scalping: since trader is going against trend, scalping is inherently riskier than trend following - make sure you use tight stops. Example below demonstrates Accumulation/Distribution in OB/OS Mode, scalping GBP/JPY while it ranges.





Expanded User Manual

The manual, 48 pages in length, has been revised to cover Accumulation/Distribution integrated indicator and its features - see section 4.3.32.


Existing Customers

If you are an existing TradeBuilder Classic customer, only one of the following two options applies:

  1. Customers who purchased TradeBuilder - Classic Edition on or after April 8, 2012 qualify for a free upgrade.
Download latest version
  1. Customers who purchased TradeBuilder - Classic Edition before April 8, 2012 qualify for a discounted upgrade.
Upgrade now for $250

New Customers

TradeBuilder Classic 2019 Edition is available for purchase at the official MNikolic Investment Technologies store. The current, promotional price is $550. Your purchase includes all future upgrades and versions.

Purchase TradeBuilder Classic

Marko Nikolic
CEO and Chief Developer
April 27, 2019, Toronto, Canada

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