OPEN-SOURCE SCRIPT
SWING STOCH+RSI+CCI Strategy [SCSM_Algo]
Updated
Unveiling the SCSM Indicator: A Comprehensive Guide to Trading Success in Mid and Small-Cap Stocks
Introduction:
In the dynamic world of stock trading, finding a reliable and effective indicator is crucial for making informed decisions. The SCSM (Stochastic, RSI, EMA, and CCI) indicator is a powerful tool designed for traders seeking an edge in the mid and small-cap stock market. This innovative indicator combines key technical analysis components to generate precise buy and sell signals, helping traders navigate the complexities of the market with confidence.
1. **Stochastic Oscillator (15, 5, 3):**
The stochastic oscillator is a key player in the SCSM strategy, specifically focusing on the 15, 5, 3 parameters. A buy signal is generated when both %K and %D crossovers occur below the lower band. This condition acts as an early indication of potential upward momentum. To complement this, the RSI (14) should be on the rise, and the stock price must be above the 3-EMA (Exponential Moving Average). This combination forms a solid foundation for identifying favorable buy opportunities. Use hekin-ashi candlestick & 4hr TF for more accuracy.
2. **CCI (Commodity Channel Index):**
The CCI plays a pivotal role in capturing quick trade signals within the broader strategy. By customizing the default settings, the indicator triggers a blue dot when the CCI crosses below the lower band, signaling a potential uptrend. Conversely, a red dot appears when the CCI crosses above the upper band, indicating a potential downtrend. These quick trend signals provide traders with valuable insights for making swift and strategic decisions.
3. **Profit Expectations in Swing Trade:**
On the basis of our default settings in this indicator, traders can anticipate a profit ranging from 3% to 7% in a swing trade. We have set a default profit target of 5%, which users can adjust according to their individual risk tolerance and trading preferences. This customizable feature allows traders to tailor the indicator to their specific profit objectives, enhancing flexibility in their trading strategies.
4. **Time Frame and Success Ratio:**
The SCSM strategy is optimized for the 4-hour time frame, catering specifically to mid and small-cap stocks. Through meticulous backtesting, the indicator has demonstrated a success ratio ranging from 60% to 70%. While this strategy has shown promise, it is essential to note that it is intended for learning and testing purposes. Traders are encouraged to use this tool as part of a comprehensive approach to risk management and market analysis.
5. **Learn More on YouTube:**
For a more in-depth understanding of the SCSM indicator and its application, we invite you to explore our dedicated video on YouTube (SHARIAH COMPLIANT SHARE MARKET (India)). This resource provides visual insights, practical examples, and additional tips for leveraging the indicator effectively in your trading journey.
Special Thanks:
We extend our heartfelt appreciation to Aijaz Mohsin Sir, whose unwavering support in technical analysis has been invaluable to our journey. His guidance and expertise have played a significant role in the development and understanding of the SCSCM indicator.
**Disclaimer:**
The SCSM indicator is a tool for educational and testing purposes only. Past performance is not indicative of future results, and trading always involves a degree of risk. Traders should exercise caution, conduct their own research, and consider consulting with financial professionals before making any trading decisions. The indicator's default profit target and settings are customizable, but users should be aware of the inherent risks associated with trading in financial markets. The creators of the SCSM indicator do not guarantee specific outcomes, and users are encouraged to practice responsible trading.
Introduction:
In the dynamic world of stock trading, finding a reliable and effective indicator is crucial for making informed decisions. The SCSM (Stochastic, RSI, EMA, and CCI) indicator is a powerful tool designed for traders seeking an edge in the mid and small-cap stock market. This innovative indicator combines key technical analysis components to generate precise buy and sell signals, helping traders navigate the complexities of the market with confidence.
1. **Stochastic Oscillator (15, 5, 3):**
The stochastic oscillator is a key player in the SCSM strategy, specifically focusing on the 15, 5, 3 parameters. A buy signal is generated when both %K and %D crossovers occur below the lower band. This condition acts as an early indication of potential upward momentum. To complement this, the RSI (14) should be on the rise, and the stock price must be above the 3-EMA (Exponential Moving Average). This combination forms a solid foundation for identifying favorable buy opportunities. Use hekin-ashi candlestick & 4hr TF for more accuracy.
2. **CCI (Commodity Channel Index):**
The CCI plays a pivotal role in capturing quick trade signals within the broader strategy. By customizing the default settings, the indicator triggers a blue dot when the CCI crosses below the lower band, signaling a potential uptrend. Conversely, a red dot appears when the CCI crosses above the upper band, indicating a potential downtrend. These quick trend signals provide traders with valuable insights for making swift and strategic decisions.
3. **Profit Expectations in Swing Trade:**
On the basis of our default settings in this indicator, traders can anticipate a profit ranging from 3% to 7% in a swing trade. We have set a default profit target of 5%, which users can adjust according to their individual risk tolerance and trading preferences. This customizable feature allows traders to tailor the indicator to their specific profit objectives, enhancing flexibility in their trading strategies.
4. **Time Frame and Success Ratio:**
The SCSM strategy is optimized for the 4-hour time frame, catering specifically to mid and small-cap stocks. Through meticulous backtesting, the indicator has demonstrated a success ratio ranging from 60% to 70%. While this strategy has shown promise, it is essential to note that it is intended for learning and testing purposes. Traders are encouraged to use this tool as part of a comprehensive approach to risk management and market analysis.
5. **Learn More on YouTube:**
For a more in-depth understanding of the SCSM indicator and its application, we invite you to explore our dedicated video on YouTube (SHARIAH COMPLIANT SHARE MARKET (India)). This resource provides visual insights, practical examples, and additional tips for leveraging the indicator effectively in your trading journey.
Special Thanks:
We extend our heartfelt appreciation to Aijaz Mohsin Sir, whose unwavering support in technical analysis has been invaluable to our journey. His guidance and expertise have played a significant role in the development and understanding of the SCSCM indicator.
**Disclaimer:**
The SCSM indicator is a tool for educational and testing purposes only. Past performance is not indicative of future results, and trading always involves a degree of risk. Traders should exercise caution, conduct their own research, and consider consulting with financial professionals before making any trading decisions. The indicator's default profit target and settings are customizable, but users should be aware of the inherent risks associated with trading in financial markets. The creators of the SCSM indicator do not guarantee specific outcomes, and users are encouraged to practice responsible trading.
Release Notes
UpdatedImprove Stop loss.
Drawdown decreased.
RSI comparison table added.
RSI signal added.
Customisation enabled.
Release Notes
MACD Table Added: A real-time table has been integrated into the chart to display the current values of the MACD line, Signal line, and Histogram. This table provides an at-a-glance summary of the indicator's key components, enhancing the user experience.MACD value: Displays the difference between the fast and slow moving averages.
Signal line value: Shows the smoothed value of the MACD.
Histogram value: Represents the difference between the MACD line and the Signal line, giving insight into trend strength and direction.
Open-source script
In true TradingView spirit, the author of this script has published it open-source, so traders can understand and verify it. Cheers to the author! You may use it for free, but reuse of this code in publication is governed by House rules. You can favorite it to use it on a chart.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.