The Mass Index is a technical indicator used to identify potential trend reversals based on market volatility. It primarily focuses on the range between the high and low prices over a specified number of periods.

Syntax:

MassIndex[N]

Where N represents the number of periods over which the Mass Index is calculated.

Calculation:

The Mass Index is calculated using the following formula:

MassIndex = Summation[N](ExponentialAverage[N](high - low) / ExponentialAverage[N](ExponentialAverage[N](high - low)))

This formula involves taking an exponential moving average of the high-low difference, then taking an exponential moving average of that average, and finally dividing the first average by the second. The results over N periods are then summed to produce the Mass Index.

Example:

Here is a simple example of how to use the Mass Index in ProBuilder:

i1 = MassIndex[10]
i2 = average[1000](i1)
RETURN i1, i2 as "potential end of MassIndex cycle indicator"

In this example, i1 calculates the Mass Index over 10 periods, and i2 calculates the average of i1 over 1000 periods. The results are returned as indicators of potential ends of Mass Index cycles.

Additional Information:

• The Mass Index is particularly useful for detecting shifts in market volatility. An increase in the index suggests an increase in the range between high and low prices, indicating potential market reversals.
• Typically, traders look for a threshold level above 27 to indicate a potential reversal when the index subsequently falls below 26.5.
• It is often beneficial to plot a 9-day exponential moving average of the price alongside the Mass Index to better interpret the signals.

This indicator does not provide direct buy or sell signals but rather highlights periods of potential volatility and price reversal, which should be further analyzed using other aspects of technical analysis.