The "Market thermometer" indicator
"Market thermometer" was described in the book "Trading with Dr. The Elder. Encyclopedia of exchange games". "Market thermometer" measures how the maximal or minimal point of today’s range is higher or lower than previous maximum or minimum. If today’s maximum or minimum is less or more than yesterday’s, then "market temperature" is zero. The values of the "market thermometer" are smoothed by moving average (Elder uses EMA 22, that corresponds to the number of working days in the month). "Market thermometer" shows the phases where market volatility increases or decreases.