Colouring Candles

If you are a MetaStock user, this next section may be of benefit to you. Simon Sherwood, author of  ‘MetaStock in a Nutshell’ agreed to provide some guidelines for MetaStock users in relation to candlesticks.

In MetaStock, the Candlestick charts show the candles as black and white by default.  The Up candles, where the close is greater than the open are coloured white and the Down candles, where the close is less than or equal to the open are coloured black.

Now whilst this is quite acceptable, there is also a general pseudo ‘standard’ that has Up days green and Down days red.

In MetaStock there is some colour selection available through the price plot properties box, but the colour relationship is based solely on the closing price i.e. the Up and Down colour selections apply to the closing price only, from one period to the next.  So for example, if you set the colours as Green for Up and Red for Down, you might be surprised at the result.

You actually end up with FOUR different types of candles – and you only wanted TWO!

These are the possibilities:

1.     An Open Green candle – the Close is above the Open and the Close today is higher than yesterday's Close

2.     An Open Red candle – the Close is above the Open but the Close today is lower than yesterday's Close

3.     A Solid Green candle – the Close is below the Open but the Close today is above yesterday's Close

4.     A Solid Red candle – the Close is below the Open and the Close today is below yesterday's Close

So in this case:

‘A’ - the Candle is coloured Red or Green depending on the relationship of today's Close with yesterday's Close. If the Close is higher, then the Candle is Green, if the Close is lower, then the Candle is Red.

AND

‘B’ - the Candle is Solid if the Close is below the Open and Open (unfilled) if the Close is above the Open.

All clear - well I hope so!

Anyway, this is different to the way we really want our Candlesticks coloured. Normally, we only want to know if the Close is above or below the Open (part ‘B’ above).

Well the good news is that there is a way to get MetaStock to emulate this much sort after colour scheme using the ‘Expert Advisor’. We won’t be going into any detail about the Experts, except to give you a step-by-step guide to program this Candlestick colouring example.

1. Click on the Expert Advisor icon (the little man who looks like Charlie Chaplin!)     

Or select the ‘Expert Advisor…’ from the ‘Tools’ drop down menu

You are now at the main Expert Advisor window.

2. To create our new expert, click the ‘New…’ button.

This brings up the Expert Editor. Here you can give the Expert a name, something like ‘Candlestick Colours’ and also add some comments so you know what it does. Like this:

3. Now select the ‘Highlights’ Tab

Select ‘New’ to create a new highlight!

Complete the details as per the following:

You can use whatever colour you want – I selected Dark Green.

Please note that the O is an O as in Open!!

Click ‘OK’.

You are now ready to enter the second highlight (for Down candles – the unhappy ones!!!)

4. Click ‘New’ and complete the second highlight as follows, again you can use any colour you like:

Please note that the O is an O as in Open!!

5. To finish again, click ‘OK’.

You should now have something that looks like this:

6. Click ‘OK’ to return to the main Expert Advisor window.

Create a new chart or open and existing chart or Smart Chart, Right Click on the main chart window to bring up the right click short cut menu. From here select ‘Expert Advisor’ and then ‘Attach…’. This brings up the ‘Attach Expert’ box – select the Candle colouring expert or whatever you called the Expert and click the ‘OK’ button.

Your chart will then be coloured, Green bars or open candles where the Close is above the Open and Red bars or solid candles for when the Close is below the Open – make sure your chart is set to the Candlestick variety to get the best effect.

If you attach the Expert to a Smart Chart, then it will be saved with the Smart Chart, so each time you look at it, the candles will be nicely coloured.  If you attach the Expert to a chart, you will be prompted to save the changes.

Experts can be included in templates too, so you might create a template that changes a chart to a weekly candlestick chart, colours the candles with the Expert and plots a 30 period exponential moving average.

To detach an Expert, right click on the main chart Window and select ‘Detach’ from the ‘Expert Advisor’ menu.

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