The Waddah Attar explosion indicator is a well known indi in the forex community all over the web. It measures the price volatility “explosion” with the help of a difference between upper and lower bollinger bands (also known as “squeeze”) and its direction and with a slow MACD advance or decline weighted with a coefficient (sensitivity=150).

A “deadzone” of x pips/points is at 20 points by default, but should be adjusted to the traded instrument.

If green or red oscillator histogram breach the “Explosion Line” above the dead zone, it’s a signal.

This indicator act pretty much as a scalper in lower timeframe, but I found it useful with different timeframe comparison in higher ones in the past (M30/H1/H4).

// -- parameters
//sensitivity = 150
//fastLength=20 //"FastEMA Length"
//slowLength=40 //"SlowEMA Length"
//channelLength=20 //"BB Channel Length"
//mult=2.0 //"BB Stdev Multiplier")
//deadZone=30 //"No trade zone threshold"

// indis
if barindex>slowLength then
 calcMACD = MACD[fastLength,slowLength,9](customclose)
 calcBBUpper = average[channelLength](customclose)+(mult*std[channelLength](customclose))
 calcBBLower = average[channelLength](customclose)-(mult*std[channelLength](customclose))

 t1 = (calcMACD-calcMACD[1])*sensitivity
 e1 = calcBBUpper - calcBBLower

 if t1>=0 then
  trendUP = t1
  trendDOWN = 0
 else
  trendUP = 0
  trendDOWN = -1*t1
 endif

 if trendUP<trendUP[1] then
  color = -1
 else
  color = 1
 endif

 if trendDOWN<trendDOWN[1] then
  color = -1
 else
  color = 1
 endif
endif

RETURN trendUP coloured by color as "UP", trendDOWN coloured by color as "DOWN", e1 as "Explosion line", deadzone*pipsize as "Dead Zone Line"