This is a very interesting and useful indicator.
You can use it for the following purposes:
Trend
——We are in an uptrend when dots are below the candles.
——Downtrend is when dots are above the price.
Entry Signals
—— Buy signals ( Only in an uptrend market ). The first dot below the candle
—— Sell Signals ( Only in a downtrend market ). The first dot above the candle.
Stop loss
—— Long positions: Put the stop loss below the dot. ( You can move the SL every time to use as a trailing SL.)
—— Short positions: Put the stop loss above the dot. ( You can move the SL every time to use as a trailing SL.)
As I said before to avoid false entries as much as possible only trade in the direction of the long time trend. Use a trend indicator or big MA to determine the trend direction.
Settings for AF numbers ( Acceleration Factor ) can be changed but I prefer the default settings.