History and Background

Australian trader Daryl Guppy developed the GMMA. He designed it to give traders a better visual of trend strength and to distinguish between short-term traders and long-term investors in the market.

By plotting multiple EMAs in two groups, short-term and long-term, the indicator exposes when the market is in agreement, when it's in transition, and when traders are about to get shaken out by noise. It's widely used in trend trading strategies across all asset classes.

How the Indicator Works

The GMMA indicator plots two sets of exponential moving averages (EMAs):

• Short-Term EMAs (fast group):
• Tracks the behaviour of short-term traders. Reacts quickly to price.
• Long-Term EMAs (slow group):
• Represents the outlook of long-term investors. Moves more slowly and steadily.

When all groups are aligned and they are moving in the same direction, it indicates a strong trend, and when they converge, it suggests a consolidation or a possible reversal.

Key Features

• 12 EMAs (6 short-term, six long-term) for clear trend structure
• Easy-to-read visual separation between trader and investor sentiment
• Colour-coded lines to distinguish groups at a glance
• Fully customizable periods and line styles
• Works across all markets and timeframes
• Instant trend identification without laggy filters
• A signal is displayed on the chart for a bullish or bearish trend

How to Use it for Trading

• Trend Following:
  When short-term EMAs are above long-term EMAs and both are spreading, it's a strong uptrend. Reverse for downtrend.

• Entry Signals:
  Look for separation between the groups after a compression or crossover.

• Exit Signals:
  When short-term EMAs start to cut back through the long-term EMAs, it may signal the end of a trend.

• Sideways Market Warning:
  EMAs tangled together? It's likely a range-bound or choppy market. Wait for clean separation.

GMMA Formula

EMA_t = α × P_t + (1 - α) × EMA_t-1

Where α = 2 / (N + 1), N is the EMA period

Short-Term Group Periods: 3, 5, 8, 10, 12, 15
Long-Term Group Periods: 30, 35, 40, 45, 50, 60

While the GMMA is great for trend trading, it doesn't perform well in low-volatility or sideways markets. During consolidation, the lines can bunch together and give false impressions of trend changes. It's also a visual indicator, so it works best when combined with price action or confirmation tools for entries.

How To Install & Remove

First, ensure that you have the cTrader trading platform installed. Then, unzip the file and double-click it to install the platform automatically.

• How to install
• How to open
• How to remove
• How to edit settings

Help Using This Indicator

If you need help using this indicator, try asking cTrader Sensei, our free AI assistant dedicated to the cTrader platform, rated 4.9 out of 5 in the ChatGPT Store. It can guide you through setup, usage, and troubleshooting with clear, step-by-step support.

• Chat with cTrader Sensei.

If you still need assistance, feel free to post your question on our product support forum, where our team and community can help.

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