Hull moving average
A moving average designed by Alan Hull to cut lag while staying smooth, so it follows turns in price more closely.
What the Hull moving average is.
A faster, smoother moving average built from weighted averages.
The Hull moving average, or HMA, was designed by Alan Hull in 2005. It tackles a familiar problem: smooth averages lag, and fast averages are noisy.
The HMA combines two weighted moving averages to cancel out much of the lag, then smooths the result again. The line turns close to price but stays fairly smooth.
A weighted moving average, or WMA, gives the newest bar the most weight, the bar before slightly less, and so on in equal steps.
How it is calculated.
Three steps on every bar. The custom indicator does the maths for you.
Take two weighted averages.
Work out a WMA over half the period and a WMA over the full period. For a 20-period HMA, that is a 10-period and a 20-period WMA.
Double the short one and subtract the long one.
Doubling the faster average and taking away the slower one pushes the line towards current price. This cancels much of the lag.
Smooth the result.
Take a WMA of that new series over the square root of the period. For 20, that is about 4 bars.
HMA = WMA(Raw, √n)
WMA gives the newest of n bars a weight of n, the next n − 1, down to 1 for the oldest
| SMA (20) | EMA (20) | Hull (20) | |
|---|---|---|---|
| Lag at turns | Most | Less | Least |
| Smoothness | Smooth | Fairly smooth | Fairly smooth, can overshoot |
| Built into MT5 | Yes | Yes | No: custom indicator |
How to read it.
How traders read the Hull line. None of these is a signal on its own.
The slope.
Many traders watch the direction of the line. When it turns from rising to falling, momentum has shifted. Some versions colour the line to show this.
Turns, not crossovers.
Because the HMA hugs price, price crosses it often. Its turning points usually say more than price crossing the line.
Overshoot.
The doubling step can make the line run slightly past price at sharp turns, before it settles back. Expect it rather than react to it.
Pairing with a slower average.
Some traders use a Hull line for timing and a longer, slower average for the overall trend.
Common mistakes.
Where traders new to the Hull moving average most often go wrong.
Expecting no lag at all. The HMA reduces lag, but it is still built from past prices and still turns after price does.
Trading every small wiggle. A short Hull period reacts to noise and can turn back and forth in a range.
Ignoring the overshoot. At sharp reversals the line can run past price before it settles.
Installing any custom indicator you find. Check where it comes from and how it is built before you add it to MT5.
Using it on MetaTrader 5.
The Hull moving average is not one of MT5’s built-in indicators. You add it as a custom indicator on the desktop app.
Open the Toolbox.
In MetaTrader 5 for desktop, open the Toolbox window from the View menu and select the Code Base tab.
Find a Hull moving average.
Find a Hull moving average in the Code Base and download it. MT5 adds it to your terminal.
Add it to a chart.
Open the Navigator, find it under Indicators, and drag it onto the chart.
Set the period.
Enter the period you want, such as 20, and apply it to the close if the indicator asks.
Questions, answered.
What traders ask most about the Hull moving average.
01Who created the Hull moving average?
02Why does it use the square root of the period?
03Is the Hull moving average better than an EMA?
04Why is it not in MT5 already?
05Can I practise with it first?
Practise it on a demo.
Install the Hull moving average on a free MT5 demo and compare its turns with a simple average before you trade with real money.
Trading CFDs on a live account puts your capital at risk and you can lose money. A demo does not.