/**
* Money Flow Index (MFI) Indicator
* Volume-weighted momentum oscillator
*/
export function calculateMFI(highs, lows, closes, volumes, period = 14) {
// Minimum 5 data points required
if (highs.length < 5 || lows.length < 5 || closes.length < 5 || volumes.length < 5) {
return {
mfi: null,
signal: null,
trend: null,
};
}
// Use adaptive period
const effectivePeriod = Math.min(period, highs.length - 1);
// Calculate Typical Price and Raw Money Flow
const typicalPrices = [];
const rawMoneyFlows = [];
for (let i = 0; i < closes.length; i++) {
const typicalPrice = (highs[i] + lows[i] + closes[i]) / 3;
typicalPrices.push(typicalPrice);
rawMoneyFlows.push(typicalPrice * volumes[i]);
}
// Calculate Positive and Negative Money Flow
const positiveFlows = [];
const negativeFlows = [];
for (let i = 1; i < typicalPrices.length; i++) {
const currentTP = typicalPrices[i];
const previousTP = typicalPrices[i - 1];
const rawMF = rawMoneyFlows[i];
if (currentTP > previousTP) {
positiveFlows.push(rawMF);
negativeFlows.push(0);
}
else if (currentTP < previousTP) {
positiveFlows.push(0);
negativeFlows.push(rawMF);
}
else {
positiveFlows.push(0);
negativeFlows.push(0);
}
}
// Calculate Money Flow Ratio for the specified period using effective period
const usePeriod = Math.min(effectivePeriod, positiveFlows.length);
const startIdx = Math.max(0, positiveFlows.length - usePeriod);
const periodPositiveFlows = positiveFlows.slice(startIdx);
const periodNegativeFlows = negativeFlows.slice(startIdx);
const positiveMF = periodPositiveFlows.reduce((sum, flow) => sum + flow, 0);
const negativeMF = periodNegativeFlows.reduce((sum, flow) => sum + flow, 0);
if (negativeMF === 0) {
return {
mfi: 100,
signal: 'overbought',
trend: 'bullish',
};
}
const moneyFlowRatio = positiveMF / negativeMF;
const mfi = 100 - (100 / (1 + moneyFlowRatio));
// Determine signal
let signal = null;
if (mfi >= 80)
signal = 'overbought';
else if (mfi <= 20)
signal = 'oversold';
else
signal = 'neutral';
// Determine trend (comparing with previous MFI if available)
let trend = null;
if (positiveFlows.length > period) {
const prevStartIdx = startIdx - 1;
if (prevStartIdx >= 0) {
const prevPositiveFlows = positiveFlows.slice(prevStartIdx, prevStartIdx + period);
const prevNegativeFlows = negativeFlows.slice(prevStartIdx, prevStartIdx + period);
const prevPositiveMF = prevPositiveFlows.reduce((sum, flow) => sum + flow, 0);
const prevNegativeMF = prevNegativeFlows.reduce((sum, flow) => sum + flow, 0);
if (prevNegativeMF > 0) {
const prevMoneyFlowRatio = prevPositiveMF / prevNegativeMF;
const prevMFI = 100 - (100 / (1 + prevMoneyFlowRatio));
if (mfi > prevMFI)
trend = 'bullish';
else if (mfi < prevMFI)
trend = 'bearish';
else
trend = 'neutral';
}
}
}
return {
mfi,
signal,
trend,
};
}
