Monthly Cummulated Moving Average (MCMA)

A specialized moving average indicator that helps identify statistically advantageous trading opportunities based on price position relative to the MCMA line.

📊 Key Statistical Edge
The core strength of this indicator lies in its ability to identify higher probability trades:

Trades taken when price is above MCMA historically show higher win rates
Monthly calculations provide a robust baseline for trend identification
Daily updates allow for precise entry timing while maintaining monthly context

🎯 Trading Applications

Long Entry Filter:

Wait for price to trade above MCMA before considering long positions
Use as a primary filter to avoid lower probability setups
Combines daily precision with monthly trend context


Risk Management:

MCMA serves as a dynamic invalidation level
Consider closing longs when price falls below MCMA
Use as a trailing reference for position management



📈 Implementation

Calculates on daily bars for precision
Resets monthly for trend context
Plots a single line that serves as a statistical reference
Simple yet effective design focused on practical trading application

💡 Best Practices

Focus on long setups when price is trading above MCMA
Combine with volume analysis for confirmation
Pay attention to how price interacts with the MCMA line
Use alongside your existing strategy as a statistical filter

🔧 Technical Details

Built in Pine Script™ v5
Updates daily for maximum precision
Maintains monthly context for trend alignment
Optimized for computational efficiency