Market Facilitation Index

The Market Facilitation Index technical indicator (BW MFI) shows a price change on one tick. The absolute indicator values themselves mean nothing, only the indicator changes make sense. Bill Williams attaches great importance to changes in the indicator and volume:

• The Market Facilitation Index indicatorrose and the volume rose too, this means that:
  a) more and more players are entering the market (the volume is growing)
  b) newly arriving players are opening positions in the direction of thebar’s development, i.e. the movement has begun and is gaining speed.
• The Market Facilitation Index indicatorfell and the volume fell too. This means that the market participants lostinterest.
• The Market Facilitation Index indicatorrose, but the volume fell. The market is not supported by the volume fromtraders, and the price changes thanks to speculations offloor traders (intermediaries: brokers and dealers).
• The Market Facilitation Index indicatorfell, but the volume rose. A battle between bulls and bears takes place,with a large volume of buys and sells, but with a slight movement of theprice itself due to approximately equal forces. One of two opposing sides(buyers vs sellers) will win. Usually a breakout of such a bar indicateswhether this bar determines the trend continuation or the trend iscanceled. Bill Williams call such a bar “crouching”.

The indicator view in the chart.

The indicator has the following parameters:

Settings

Multiplier - setting of the indicator value multiplication.

Drawing

Panel/Moving average period - selection of the indicator location in the chart:

• New panel
• Chart

Visualization

Show value - display of the indicator value on the price scale on the left.

Scale/Auto-scaling - if this option is on, the scale will be automatically calculated, based on the minimum and maximum indicator values, so that the indicator would fit in the chart.

Color - color setting of the indicator.

Visual type - visual setting of the indicator display in the chart:

• Line
• Histogram
• Hash
• Block
• Cross
• Square
• Dots
• Up arrow
• Down arrow
• Axis label
• Hide

Line style - setting of the line display style:

• Solid
• Dash
• Dash - dot
• Dash - dot - dot

Width - setting of the indicator line width.