In this article we present a modified indicator for Metatrader 4 designed to plot the KAMA Adaptive Moving Average on any price chart of this platform. It can be modified to show the moving average with different types of prices, such as the closing price, the opening price or the maximum price of each period. Before talking about this modified indicator, we are going to explain what the KAMA moving average is.
What is the KAMA moving average?
KAMA is short for Kaufman’s Adaptive Moving Average. This moving average is designed to automatically adapt to changing trend conditions, thanks to its calculation formula, which is similar to the one used to calculate the exponential moving average (EMA). The difference between the two moving averages is the smoothing factor K, which in the KAMA is determined by a much more complex formula than in the EMA.