Daily BreadWhat it does:
This script uses specific multiple true ranges from a 30 EMA baseline to plot lines that represent 10% buying increments. Although the common period for ATR is 14, this script employs a period of 20 for smoothing that I have determined is more effective when used with a daily candle chart. It includes onscreen trend signals to identify an uptrend or downtrend when the 50 EMA crosses the 90 EMA and will also display a coloured directional signal at each candle beyond an EMA cross to identify the current trend.
The script plots a scale of percentage labels at the end of each line to identify the percent of an account intended to be in short or longer term trades.
How it does it:
The script uses a 30 EMA baseline and then multiplies ATR increments of +1, +2, +4 and -1 through -7. These ATR multiples and the EMA are plotted as 11 lines, 10 of which make up the range of 10% increments from 10% to 100% with the 11th line being the High Band representing the extreme high or expected sale of any holdings. The percentage label scale uses variable declarations to position and colour match a percentage label to each line.
Intended use:
It is intended to be used for short term trading or long term investing with a daily market index chart such as SPY and multiple exchange traded funds that track said market index. A different ETF is purchased when a daily SPY candle reaches a lower buy band using 10% of a total account value. The sale of any ETFs is at the discretion of the trader and dependent on investment strategy (short term trading or long term inventing) and the trend. When short term trading in a downtrend or when daily candles are below the 50 EMA, selling would be done every 2 to 3 bands above a buy to mitigate the risk of a significant portion of an account getting caught in a downtrend. In an uptrend the High Band would be used to sell any holdings.
Search in scripts for "bands"
MTF SqzMom [tradeviZion]Credits:
John Carter for creating the TTM Squeeze and TTM Squeeze Pro.
Lazybear for the original interpretation of the TTM Squeeze: Squeeze Momentum Indicator.
Makit0 for evolving Lazybear's script by incorporating TTM Squeeze Pro upgrades – Squeeze PRO Arrows.
MTF SqzMom - Multi-Timeframe Squeeze & Momentum Tool
MTF SqzMom is a tool designed to help traders easily monitor squeeze and momentum signals across multiple timeframes in a simple, organized format. Built using Pine Script 5, it ensures that data remains consistent, even when switching between different time intervals on the chart.
Key Features:
Multi-Timeframe Monitoring: Track squeeze and momentum signals across various timeframes, all in one view. This includes key timeframes like 1-minute, 5-minute, hourly, and daily.
Dynamic Table Display: A color-coded table that automatically adjusts based on the selected timeframes, offering a clear view of market conditions.
Alerts for Key Market Events: Get notifications when a squeeze starts or fires across your chosen timeframes, so you can stay informed without needing to monitor the chart continuously.
Customizable Appearance: Tailor the look of the table by selecting colors for squeeze levels and momentum shifts, and choose the best position on your chart for easy access.
How It Works:
MTF SqzMom is based on the concept of the squeeze, which signals periods of lower volatility where price breakouts may occur. The tool tracks this by monitoring the contraction of Bollinger Bands within Keltner Channels. Along with this, it provides momentum analysis to help you gauge the potential direction of the market after a squeeze.
Squeeze Conditions: The script tracks four levels of squeeze conditions (no squeeze, low, mid, and high), each represented by a different color in the table.
Momentum Analysis: Momentum is visually represented by colors indicating four stages: up increasing, up decreasing, down increasing, and down decreasing. This color coding helps you quickly assess whether the market is gaining or losing momentum.
Using Alerts:
You can enable two types of alerts: when a squeeze starts (indicating consolidation) and when a squeeze fires (indicating a breakout). These alerts cover all timeframes you’ve selected, so you never miss important signals.
How to Set It Up:
1. Enable Alerts in Settings: Turn on "Alert for Squeeze Start" and "Alert for Squeeze Fire" in the settings.
2. Add Alerts to Your Chart:
Click the three dots next to the indicator name.
Select "Add alert on tradeviZion - MTF SqzMom."
3. Customize and Save: Adjust alert options, choose your notification type, and click "Create."
Why Use MTF SqzMom ?
Consistent Data: The tool ensures that squeeze and momentum data remain consistent, even when you switch between chart intervals.
Real-Time Alerts: Stay updated with alerts for squeeze conditions without needing to constantly watch the chart.
Simple to Use, Customizable to Fit: You can easily adjust the table’s look and choose the timeframes and colors that best suit your trading style.
Acknowledgment:
While this tool builds on the TTM Squeeze concept developed by John Carter of Simpler Trading, it offers added flexibility through multi-timeframe analysis, alerts, and customizability to make monitoring market conditions more accessible.
Double Donchian Channels [CrossTrade]Dual Channel System
The indicator incorporates two Donchian Channels - the Inner Channel and the Outer Channel. These channels are adjustable, allowing users to define their lengths according to their trading strategy.
Inner Channel: With a default length of 100 periods, the Inner Channel provides a closer view of market trends and potential support and resistance areas. It includes an upper, lower, and middle line (average of the upper and lower), offering detailed insights into shorter-term price movements.
Outer Channel: Set with a default length of 300 periods, the Outer Channel offers a broader perspective, ideal for identifying long-term trends and stronger levels of support and resistance.
Dynamic Color Coding: The middle lines of both channels change color based on the relationship between the previous close and the channel's basis. This feature provides an immediate visual cue regarding market sentiment.
Touching Bars Highlighting: The indicator highlights bars that touch the upper or lower bands of either channel. This is particularly useful for identifying potential reversals or continuation patterns.
Pullback Identification: By differentiating between bars that touch the Inner Channel only and those that touch the Outer Channel, the indicator helps in identifying pullbacks within a broader trend.
Customizable Alert System: Users can set up alerts for specific conditions - a bar touching the bottom band of the Inner Channel (green), the bottom band of the Outer Channel (blue), the upper band of the Inner Channel (red), and the upper band of the Outer Channel (orange). These alerts assist in timely decision-making and can be tailored to individual trading styles.
The indicator is a versatile tool designed to adapt to various trading styles and timeframes. Its features make it suitable for trend analysis, identifying potential reversal points, and understanding market volatility.
Advanced Keltner Channel/Oscillator [MyTradingCoder]This indicator combines a traditional Keltner Channel overlay with an oscillator, providing a comprehensive view of price action, trend, and momentum. The core of this indicator is its advanced ATR calculation, which uses statistical methods to provide a more robust measure of volatility.
Starting with the overlay component, the center line is created using a biquad low-pass filter applied to the chosen price source. This provides a smoother representation of price than a simple moving average. The upper and lower channel lines are then calculated using the statistically derived ATR, with an additional set of mid-lines between the center and outer lines. This creates a more nuanced view of price action within the channel.
The color coding of the center line provides an immediate visual cue of the current price momentum. As the price moves up relative to the ATR, the line shifts towards the bullish color, and vice versa for downward moves. This color gradient allows for quick assessment of the current market sentiment.
The oscillator component transforms the channel into a different perspective. It takes the price's position within the channel and maps it to either a normalized -100 to +100 scale or displays it in price units, depending on your settings. This oscillator essentially shows where the current price is in relation to the channel boundaries.
The oscillator includes two key lines: the main oscillator line and a signal line. The main line represents the current position within the channel, smoothed by an exponential moving average (EMA). The signal line is a further smoothed version of the oscillator line. The interaction between these two lines can provide trading signals, similar to how MACD is often used.
When the oscillator line crosses above the signal line, it might indicate bullish momentum, especially if this occurs in the lower half of the oscillator range. Conversely, the oscillator line crossing below the signal line could signal bearish momentum, particularly if it happens in the upper half of the range.
The oscillator's position relative to its own range is also informative. Values near the top of the range (close to 100 if normalized) suggest that price is near the upper Keltner Channel band, indicating potential overbought conditions. Values near the bottom of the range (close to -100 if normalized) suggest proximity to the lower band, potentially indicating oversold conditions.
One of the strengths of this indicator is how the overlay and oscillator work together. For example, if the price is touching the upper band on the overlay, you'd see the oscillator at or near its maximum value. This confluence of signals can provide stronger evidence of overbought conditions. Similarly, the oscillator hitting extremes can draw your attention to price action at the channel boundaries on the overlay.
The mid-lines on both the overlay and oscillator provide additional nuance. On the overlay, price action between the mid-line and outer line might suggest strong but not extreme momentum. On the oscillator, this would correspond to readings in the outer quartiles of the range.
The customizable visual settings allow you to adjust the indicator to your preferences. The glow effects and color coding can make it easier to quickly interpret the current market conditions at a glance.
Overlay Component:
The overlay displays Keltner Channel bands dynamically adapting to market conditions, providing clear visual cues for potential trend reversals, breakouts, and overbought/oversold zones.
The center line is a biquad low-pass filter applied to the chosen price source.
Upper and lower channel lines are calculated using a statistically derived ATR.
Includes mid-lines between the center and outer channel lines.
Color-coded based on price movement relative to the ATR.
Oscillator Component:
The oscillator component complements the overlay, highlighting momentum and potential turning points.
Normalized values make it easy to compare across different assets and timeframes.
Signal line crossovers generate potential buy/sell signals.
Advanced ATR Calculation:
Uses a unique method to compute ATR, incorporating concepts like root mean square (RMS) and z-score clamping.
Provides both an average and mode-based ATR value.
Customizable Visual Settings:
Adjustable colors for bullish and bearish moves, oscillator lines, and channel components.
Options for line width, transparency, and glow effects.
Ability to display overlay, oscillator, or both simultaneously.
Flexible Parameters:
Customizable inputs for channel width multiplier, ATR period, smoothing factors, and oscillator settings.
Adjustable Q factor for the biquad filter.
Key Advantages:
Advanced ATR Calculation: Utilizes a statistical method to generate ATR, ensuring greater responsiveness and accuracy in volatile markets.
Overlay and Oscillator: Provides a comprehensive view of price action, combining trend and momentum analysis.
Customizable: Adjust settings to fine-tune the indicator to your specific needs and trading style.
Visually Appealing: Clear and concise design for easy interpretation.
The ATR (Average True Range) in this indicator is derived using a sophisticated statistical method that differs from the traditional ATR calculation. It begins by calculating the True Range (TR) as the difference between the high and low of each bar. Instead of a simple moving average, it computes the Root Mean Square (RMS) of the TR over the specified period, giving more weight to larger price movements. The indicator then calculates a Z-score by dividing the TR by the RMS, which standardizes the TR relative to recent volatility. This Z-score is clamped to a maximum value (10 in this case) to prevent extreme outliers from skewing the results, and then rounded to a specified number of decimal places (2 in this script).
These rounded Z-scores are collected in an array, keeping track of how many times each value occurs. From this array, two key values are derived: the mode, which is the most frequently occurring Z-score, and the average, which is the weighted average of all Z-scores. These values are then scaled back to price units by multiplying by the RMS.
Now, let's examine how these values are used in the indicator. For the Keltner Channel lines, the mid lines (top and bottom) use the mode of the ATR, representing the most common volatility state. The max lines (top and bottom) use the average of the ATR, incorporating all volatility states, including less common but larger moves. By using the mode for the mid lines and the average for the max lines, the indicator provides a nuanced view of volatility. The mid lines represent the "typical" market state, while the max lines account for less frequent but significant price movements.
For the color coding of the center line, the mode of the ATR is used to normalize the price movement. The script calculates the difference between the current price and the price 'degree' bars ago (default is 2), and then divides this difference by the mode of the ATR. The resulting value is passed through an arctangent function and scaled to a 0-1 range. This scaled value is used to create a color gradient between the bearish and bullish colors.
Using the mode of the ATR for this color coding ensures that the color changes are based on the most typical volatility state of the market. This means that the color will change more quickly in low volatility environments and more slowly in high volatility environments, providing a consistent visual representation of price momentum relative to current market conditions.
Using a good IIR (Infinite Impulse Response) low-pass filter, such as the biquad filter implemented in this indicator, offers significant advantages over simpler moving averages like the EMA (Exponential Moving Average) or other basic moving averages.
At its core, an EMA is indeed a simple, single-pole IIR filter, but it has limitations in terms of its frequency response and phase delay characteristics. The biquad filter, on the other hand, is a two-pole, two-zero filter that provides superior control over the frequency response curve. This allows for a much sharper cutoff between the passband and stopband, meaning it can more effectively separate the signal (in this case, the underlying price trend) from the noise (short-term price fluctuations).
The improved frequency response of a well-designed biquad filter means it can achieve a better balance between smoothness and responsiveness. While an EMA might need a longer period to sufficiently smooth out price noise, potentially leading to more lag, a biquad filter can achieve similar or better smoothing with less lag. This is crucial in financial markets where timely information is vital for making trading decisions.
Moreover, the biquad filter allows for independent control of the cutoff frequency and the Q factor. The Q factor, in particular, is a powerful parameter that affects the filter's resonance at the cutoff frequency. By adjusting the Q factor, users can fine-tune the filter's behavior to suit different market conditions or trading styles. This level of control is simply not available with basic moving averages.
Another advantage of the biquad filter is its superior phase response. In the context of financial data, this translates to more consistent lag across different frequency components of the price action. This can lead to more reliable signals, especially when it comes to identifying trend changes or price reversals.
The computational efficiency of biquad filters is also worth noting. Despite their more complex mathematical foundation, biquad filters can be implemented very efficiently, often requiring only a few operations per sample. This makes them suitable for real-time applications and high-frequency trading scenarios.
Furthermore, the use of a more sophisticated filter like the biquad can help in reducing false signals. The improved noise rejection capabilities mean that minor price fluctuations are less likely to cause unnecessary crossovers or indicator movements, potentially leading to fewer false breakouts or reversal signals.
In the specific context of a Keltner Channel, using a biquad filter for the center line can provide a more stable and reliable basis for the entire indicator. It can help in better defining the overall trend, which is crucial since the Keltner Channel is often used for trend-following strategies. The smoother, yet more responsive center line can lead to more accurate channel boundaries, potentially improving the reliability of overbought/oversold signals and breakout indications.
In conclusion, this advanced Keltner Channel indicator represents a significant evolution in technical analysis tools, combining the power of traditional Keltner Channels with modern statistical methods and signal processing techniques. By integrating a sophisticated ATR calculation, a biquad low-pass filter, and a complementary oscillator component, this indicator offers traders a comprehensive and nuanced view of market dynamics.
The indicator's strength lies in its ability to adapt to varying market conditions, providing clear visual cues for trend identification, momentum assessment, and potential reversal points. The use of statistically derived ATR values for channel construction and the implementation of a biquad filter for the center line result in a more responsive and accurate representation of price action compared to traditional methods.
Furthermore, the dual nature of this indicator – functioning as both an overlay and an oscillator – allows traders to simultaneously analyze price trends and momentum from different perspectives. This multifaceted approach can lead to more informed decision-making and potentially more reliable trading signals.
The high degree of customization available in the indicator's settings enables traders to fine-tune its performance to suit their specific trading styles and market preferences. From adjustable visual elements to flexible parameter inputs, users can optimize the indicator for various trading scenarios and time frames.
Ultimately, while no indicator can predict market movements with certainty, this advanced Keltner Channel provides traders with a powerful tool for market analysis. By offering a more sophisticated approach to measuring volatility, trend, and momentum, it equips traders with valuable insights to navigate the complex world of financial markets. As with any trading tool, it should be used in conjunction with other forms of analysis and within a well-defined risk management framework to maximize its potential benefits.
Daily Levels Percentual [TOLK] Settings Crypto and ForexPercentage zones refer to specific areas or bands on the price chart of a financial asset that are bounded by percentages of change relative to a reference point, such as the opening price or a reference value from a previous move.
These zones are useful for identifying support and resistance levels, predicting possible price reversals, or setting price targets. For example, on a price chart, you can create percentage zones to observe how the price behaves when it reaches 1%, 2%, 5%, 10%, etc., above or below a certain point.
These zones can be used in conjunction with other technical analysis tools, such as Fibonacci, moving averages, or volume analysis, to improve decision-making in trading strategies.
The default indicator levels are as follows:
SETTINGS Crypto:
Crypto Level 1 > 1.0%
Crypto Level 2 > 1.618%
Crypto Level 3 > 2.0%
Crypto Level 4 > 2.618%
Crypto Level 5 > 3.618%
Crypto Level 6 > 4.618%
Crypto Level 7 > 5.0%
Crypto Level 8 > 7.618%
Crypto Level 9 > 10.0%
Crypto Level 10 > 12.618%
Crypto Level 11 > 13.618%
Crypto Level 12 > 15%
Crypto Level 13 > 17.618%
Crypto Level 14 > 20%
SETTINGS Forex:
Forex Level 1 > 0.10%
Forex Level 2 > 0.1618%
Forex Level 3 > 0.20%
Forex Level 4 > 0.2618%
Forex Level 5 > 0.3618%
Forex Level 6 > 0.4618%
Forex Level 7 > 0.50%
Forex Level 8 > 0.7618%
Forex Level 9 > 1.0%
Forex Level 10 > 1.2618%
Forex Level 11 > 1.3618%
Forex Level 12 > 1.50%
Forex Level 13 > 1.7618%
Forex Level 14 > 2.0%
Percentage Levels This approach helps identify critical price levels where the asset may encounter support or resistance, making it easier to make trading decisions based on price movement patterns.
Support/Resistance v2 (ML) KmeanKmean with Standard Deviation Channel
1. Description of Kmean
Kmean (or K-means) is a popular clustering algorithm used to divide data into K groups based on their similarity. In the context of financial markets, Kmean can be applied to find the average price values over a specific period, allowing the identification of major trends and levels of support and resistance.
2. Application in Trading
In trading, Kmean is used to smooth out the price series and determine long-term trends. This helps traders make more informed decisions by avoiding noise and short-term fluctuations. Kmean can serve as a baseline around which other analytical tools, such as channels and bands, are constructed.
3. Description of Standard Deviation (stdev)
Standard deviation (stdev) is a statistical measure that indicates how much the values of data deviate from their mean value. In finance, standard deviation is often used to assess price volatility. A high standard deviation indicates strong price fluctuations, while a low standard deviation indicates stable movements.
4. Combining Kmean and Standard Deviation to Predict Short-Term Price Behavior
Combining Kmean and standard deviation creates a powerful tool for analyzing market conditions. Kmean shows the average price trend, while the standard deviation channels demonstrate the boundaries within which the price can fluctuate. This combination helps traders to:
Identify support and resistance levels.
Predict potential price reversals.
Assess risks and set stop-losses and take-profits.
Should you have any questions about code, please reach me at Tradingview directly.
Hope you find this script helpful!
Moving Average Exponential-DonCHI-SUPERTRENDThe "Moving Average Exponential-DonCHI-SUPERTREND" is a trading strategy or indicator that combines three distinct technical analysis tools:
Moving Average Exponential (EMA): This is a type of moving average that gives more weight to recent prices, making it more responsive to price changes compared to a simple moving average.
Donchian Channels (DonCHI): These are bands that are plotted above and below the recent price highs and lows. They help identify the current price volatility and potential breakout points.
SUPERTREND: This is a trend-following indicator that uses the average true range (ATR) to determine the direction of the trend. It provides signals similar to moving averages but with less lag.
Keltner Channel+EMA with Buy/Sell SignalsIndicator Name: Double Keltner Channel with EMA (Buy/Sell Signals)
Description:
This indicator is designed to help traders identify potential trend reversals and generate buy/sell signals in volatile markets. It combines two Keltner Channels with different sensitivities (multipliers of 2.6 and 3.8) to visualize dynamic support and resistance levels. The addition of a 20-period EMA helps confirm trend direction and filter out potential false signals.
How the Indicator Works:
• Keltner Channels: These bands dynamically adjust to changing market volatility, offering a visual representation of potential price ranges. The 2.6 multiplier Keltner Channel (KC) is more sensitive to price changes, potentially highlighting short-term reversals, while the 3.8 multiplier KC focuses on broader trend shifts.
• 20-period EMA: This widely used trend indicator helps smooth out price fluctuations and identify the underlying direction of the market.
• Buy Signals: Generated when a candle's low touches or crosses below either Keltner Channel's lower band, and within the next 6 candles, that same candle closes above the 20 EMA. This combination suggests a potential rejection of lower prices (support) and a possible resumption of the uptrend.
• Sell Signals: Mirror the buy signal logic but are triggered when the candle's high touches or crosses above either Keltner Channel's upper band and then closes below the 20 EMA within the next 6 candles. This indicates a potential rejection of higher prices (resistance) and a possible shift to a downtrend.
How to Use the Indicator:
1. Identify the Trend: Use the 20 EMA to determine the overall trend direction. Look for buy signals primarily in uptrends and sell signals in downtrends.
2. Confirm with RSI : While not included in this indicator, consider using a separate Relative Strength Index (RSI) with a length of 10, SMA type, MA length of 14, and standard deviation of 2. Look for oversold conditions (RSI below 20) to confirm buy signals and overbought conditions (RSI above 80) to confirm sell signals.
3.Apply Risk Management: Always use appropriate risk management techniques, such as stop-loss orders, to protect your capital.
Key Points:
• This indicator is most effective in trending markets.
• It is not a standalone trading system and should be used in conjunction with other analysis tools and confirmation.
• The Keltner Channel multiplier values can be adjusted to suit your trading style and risk tolerance.
Important Disclaimer:
This indicator is a modification of the original Keltner Channel code and is intended for educational and informational purposes only.
It does not constitute financial advice. Always conduct your own research and consult with a qualified financial advisor before making any investment decisions.
MAC Investor V3.0 [VK]This indicator combines multiple functionalities to assist traders in making informed decisions. It primarily uses Heikin Ashi candles, Moving Averages, and a Price Action Channel (PAC) to provide signals for entering and exiting trades. Here's a detailed breakdown:
Inputs
MAC Length: Sets the length for the PAC calculation.
Use Heikin Ashi Candles: Option to use Heikin Ashi candles for calculations.
Show Coloured Bars around MAC: Option to color bars based on their relation to the PAC.
Show Long/Short Signals: Options to display long and short signals.
Show MAs? : Option to show moving averages on the chart.
Show MAs Trend at the Bottom?: Option to show trend signals at the bottom of the chart.
MA Lengths: Length settings for three different moving averages.
Change MA Color Based on Direction?: Option to change the color of moving averages based on trend direction.
MA Higher TimeFrame: Allows setting a higher timeframe for moving averages.
Show SL-TP Lines: Option to display Stop Loss and Take Profit lines.
SL/TP Percentages: Set the percentages for Stop Loss and three levels of Take Profit.
Calculations and Features
Heikin Ashi Candles: Calculations are based on Heikin Ashi candle data if selected.
Price Action Channel (PAC): Uses Exponential Moving Averages (EMA) of the high, low, and close to create a channel.
Bar Coloring: Colors the bars based on their position relative to the PAC.
Long and Short Signals: Uses crossovers of the close price and PAC upper/lower bands to generate signals.
Moving Averages (MA): Plots three moving averages and colors them based on their trend direction.
Overall Trend Indicators: Uses triangles at the bottom of the chart to show the overall trend of the MAs.
Stop Loss and Take Profit Levels: Calculates and plots these levels based on user-defined percentages from the entry price.
Alerts: Provides alerts for long and short signals.
Use Cases and How to Use
Identifying Trends: The PAC helps to identify the trend direction. If the closing price is above the PAC upper band, it suggests an uptrend; if below the lower band, it suggests a downtrend.
Entering Trades: Use the long and short signals to enter trades. A long signal is generated when the closing price crosses above the PAC upper band, and a short signal is generated when it crosses below the PAC lower band.
Exit Strategies: Utilize the Stop Loss (SL) and Take Profit (TP) levels to manage risk and lock in profits. These levels are automatically calculated based on the entry price and user-defined percentages.
Trend Confirmation with MAs: The moving averages provide additional confirmation of the trend. When all three MAs are trending in the same direction (e.g., all green for an uptrend), it adds confidence to the trade signal.
Overall Trend Indicators: The triangles at the bottom of the chart show the overall trend direction of the MAs:
Green Triangle: All three MAs are trending upwards, indicating a strong uptrend.
Red Triangle: All three MAs are trending downwards, indicating a strong downtrend.
Yellow Triangle: Mixed signals from the MAs, indicating no clear trend.
Bar Coloring for Quick Analysis: The colored bars give a quick visual cue about the market condition, aiding in faster decision-making.
Alerts: Set up alerts to get notified when a long or short signal is generated, allowing you to act promptly without constantly monitoring the chart.
Maximizing Profit
To maximize profit with this indicator:
Follow the Signals: Use the long and short signals to time your entries. Ensure you follow the trend indicated by the PAC and MAs.
Risk Management: Always set your Stop Loss and Take Profit levels to manage risk. This will help you cut losses early and secure profits.
Confirm with MAs: Look for confirmation from the moving averages. When all MAs align with the signal, it indicates a stronger trend.
Overall Trend Indicators: Pay attention to the triangles at the bottom for overall trend confirmation. Only enter trades when the overall trend is in your favor.
Heikin Ashi for Smoothing: Use Heikin Ashi candles for smoother trends and fewer false signals.
Backtesting: Test the indicator on historical data to understand its performance and adjust settings as necessary.
Adapt to Market Conditions: Adjust the lengths of PAC and MAs based on the market's volatility and timeframe you are trading on.
How to Use the Indicator
Add to Chart: Add the indicator to your TradingView chart.
Configure Settings: Customize the input settings to fit your trading strategy and timeframe.
Monitor Signals: Watch for long and short signals and observe the trend direction with the PAC and MAs.
Check Overall Trend: Look at the triangles at the bottom of the chart to see the overall trend direction of the MAs.
Set Alerts: Configure alerts to get notified of new signals.
Manage Trades: Use the SL and TP levels to manage your trades effectively.
Trend Strength Signals [AlgoAlpha]🌟Introducing the Trend and Strength Signals indicator by AlgoAlpha ! This tool is designed to help you identify trends and gauge market strength with precision and ease. 📈🚀
🛠 Customizable Parameters : Adjust the period, standard deviation multiplier, gauge size, and colors to fit your trading style.
📊 Trend Detection : Visualize trends with clear color-coded signals for uptrends and downtrends.
📈 Strength Gauge : Assess market strength with a dynamic gauge that adapts to the current price action.
🔔 Alerts : Set alerts for bullish and bearish trend crossovers and take profit points to stay ahead of the market.
🎨 Visual Enhancements : Enjoy a clutter-free chart with the integration of plot shapes, color fills, and gradient gauges.
🚀 Quick Guide to Using the Trend and Strength Signals Indicator
Maximize your trading with the Trend and Strength Signals indicator by following these streamlined steps! 🎯✨
🛠 Add the Indicator : Add the indicator to your favorites. Customize settings like period, standard deviation multiplier, and colors to fit your trading style.
📊 Market Analysis : Observe the color-coded candles and gauge to understand market trend direction and strength. Use the alerts for key trading signals.
🔔 Alerts : Enable notifications for trend crossovers and take profit points to catch trading opportunities without constantly monitoring the chart.
⚙️ How it works
This indicator calculates the moving average and standard deviation of the closing price over a customizable period to identify the upper and lower bounds. When the price crosses these bounds, it signals an uptrend or downtrend. The gauge measures market strength by comparing the price to the moving average and scaling it over a customizable range, while the underlying logic uses concepts from the Bollinger Bands, this indicator gives a unique perspective on price behavior through added features and signals derived from it.
Unleash the power of trend and strength analysis with this comprehensive indicator! Happy trading! 🚀📈✨
RSI and ATR Trend Reversal SL/TPQuick History:
I was frustrated with a standard fixed percent TP/SL as they often were not receptive to quick market rallies/reversals. I developed this TP/SL and eventually made it into a full fledge strategy and found it did well enough to publish. This strategy can be used as a standalone or tacked onto another strategy as a TP/SL. It does function as both with a single line. This strategy has been tested with TSLA , AAPL, NVDA, on the 15 minutes timeframe.
HOW IT WORKS:
Inputs:
Length: Simple enough, it determines the length of the RSI and ATR used.
Multiplier: This multiplies the RSI and ATR calculation, more on this later.
Delay to prevent Idealization: TradingView will use the open of the bar the strategy triggers on when calculating the backtest. This can produce unrealistic results depending on the source. If your source is open, set to 0, if anything else, set to 1.
Minimum Difference: This is essentially a traditional SL/TP, it is borderline unnecessary, but if the other parameters are wacky this can be used to ensure the SL/TP. It multiplies the source by the percent, so if it is set to 10, the SL/TP is initialized at src +- 10%.
Source input: Self Explanatory, be sure to update the Delay if you use open.
CALCULATION:
Parameters Initialization:
The strategy uses Heikinashi values for calculations, this is not toggleable in parameters, but can be easily changed by changing hclose to equal src.
FUNCTION INITIALIZATION:
highest_custom and lowest_custom do the same thing as ta.highest and ta.lowest, however the built in ta library does not allow for var int input, so I had to create my own functions to be used here. I actually developed these years ago and have used them in almost every strategy since. Feel especially free to use these in your own scripts.
The rsilev is where the magic happens.
SL/TP min/max are initially calculated to be used later.
Then we begin by establishing variables.
BullGuy is used to determine the length since the last crossup or crossdown, until one happens, it returns na, breaking the function. BearGuy is used in all the calculations, and is the same as BullGuy, unless BullGuy is na, where BearGuy counts up from 1 on each bar from 0.
We create our rsi and have to modify the second one to suit the function. In the case of the upper band, we mirror the lower one. So if the RSI is 80, we want it to be 20 on the upper band.
the upper band and lower band are calculated the exact same way, but mirrored. For the purpose of writing, I'm going to talk about the lower band. Assume everything is mirrored for the upper one. It finds the highest source since the last crossup or crossdown. It then multiplies from 1 / the RSI, this means that a rapid RSI increase will increase the band dramatically, so it is able to capture quick rally/reversals. We add this to the atr to source ratio, as the general volatility is a massive factor to be included. We then multiply this number by our chosen amount, and subtract it from the highest source, creating the band.
We do this same process but mirrored with both bands and compared it to the source. If the source is above the lower band, it suggests an uptrend, so the lower band is outputted, and vice versa for the upper one.
PLOTTING:
We also determine the line color in the same manner as we do the trend direction.
STRATEGY:
We then use the source again, and if it crosses up or down relative to the selected band, we enter a long or short respectively.
This may not be the most superb independent strategy, but it can be very useful as a TP/SL for your chosen entry conditions, especially in volatile markets or tickers.
Thank you for taking the time to read, and please enjoy.
BB + Volume Based Coloured BarsVolume Based Coloured Bars:
Most of the time traders are confused about if the price movements were supported by VOLUME .
This indicator colors the bars into volume weighted signals...
When prices go down bars are red and contraversely when up, bars are green. Additionally we have two more colors for each
situation:
PRICE BARS ARE:
DARK RED when prices go down and VOLUME is bigger than 150% of its (default 21 day) average, that indicates us price action is supported by a strong BEARISH VOLUME
RED when prices go down and VOLUME is BETWEEN 50% AND 150% of its (default 21 day) average, at this situation we can think that volume is neither strong nor weak
ORANGE when prices go down and VOLUME is just less than 50% of its (default 21 day) average, so the volume is weak and doesn't support the price action much
DARK GREEN when prices go UP and VOLUME bigger than 150% of its (default 21 day) average, that indicates us price action is supported by a strong BULLISH VOLUME
GREEN when prices go UP and VOLUME is BETWEEN 50% AND 150% of its (default 21 day) average, at this situation we can think that volume is neither strong nor weak
LIGHT GREEN when prices go UP and VOLUME is just less than 50% of its (default 21 day) average, so the volume is weak and doesn't support the price action much
21 day Simple Moving Average used as default value which can be changed in the settings menu,
21 day is considered as a month for STOCK Markets, it would be more accurate to set the value to 30 for CRYPTO CURRENCIES
And Bollinger bands
By Kıvanc Özbilgic thank you
2bandHello traders
In this script, I have defined two bands with a deviation of 2 and 3
I designed the setup so that the upper lines represent red resistance, the lower lines represent green support, and the blue line represents the average price of the previous 20 candles in each time frame.
This code can be used mostly in time frames above 30 minutes and somehow predict possible price targets.
For example, if the price closes above the blue line in the one-hour time frame, the two fixed lines above are considered as targets and vice versa.
I have also added the pivot point calculation formula in orange
Most importantly, I added the closing price of the previous days in black
I hope it will be used by dear traders and you will support more for new works.
2Mars strategy [OKX]The strategy is based on the intersection of two moving averages, which requires adjusting the parameters (ratio and multiplier) for the moving average.
Basis MA length: multiplier * ratio
Signal MA length: multiplier
The SuperTrend indicator is used for additional confirmation of entry into a position.
Bollinger Bands and position reversal are used for take-profit.
About stop loss:
If activated, the stop loss price will be updated on every entry.
Basic setup:
Additional:
Alerts for OKX:
Supertrend x4 w/ Cloud FillSuperTrend is one of the most common ATR based trailing stop indicators.
The average true range (ATR) plays an important role in 'Supertrend' as the indicator uses ATR to calculate its value. The ATR indicator signals the degree of price volatility. In this version you can change the ATR calculation method from the settings. Default method is RMA, when the alternative method is SMA.
The indicator is easy to use and gives an accurate reading about an ongoing trend. It is constructed with two parameters, namely period and multiplier.
The implementation of 4 supertrends and cloud fills allows for a better overall picture of the higher and lower timeframe trend one is trading a particular security in.
The default values used while constructing a supertrend indicator is 10 for average true range or trading period.
The key aspect what differentiates this indicator is the Multiplier. The multiplier is based on how much bigger of a range you want to capture. In our case by default, it starts with 2.636 and 3.336 for Set 1 & Set 2 respectively giving a narrow band range or Short Term (ST) timeframe visual. On the other hand, the multipliers for Set 3 & Set 4 goes up to 9.736 and 8.536 for the multiplier respectively giving a large band range or Long Term (LT) timeframe visual.
A ‘Supertrend’ indicator can be used on equities, futures or forex, or even crypto markets and also on minutes, hourly, daily, and weekly charts as well, but generally, it fails in a sideways-moving market. That's why with this implementation it enables one to stay out of the market if they choose to do so when the market is ranging.
This Supertrend indicator is modelled around trends and areas of interest versus buy and sell signals. Therefore, to better understand this indicator, one must calibrate it to one's need first, which means day trader (shorter timeframe) vs swing trader (longer time frame), and then understand how it can be utilized to improve your entries, exits, risk and position sizing.
Example:
In this chart shown above using SPX500:OANDA, 15R Time Frame, we can see that there is at any give time 1 to 4 clouds/bands of Supertrends. These four are called Set 1, Set 2, Set 3 and Set 4 in the indicator. Set's 1 & 2 are considered short term, whereas Set's 3 & 4 are considered long term. The term short and long are subjective based on one's trading style. For instance, if a person is a 1min chart trader, which would be short term, to get an idea of the trend you would have to look at a longer time frame like a 5min for instance. Similarly, in this cases the timeframes = Multiplier value that you set.
Optional Ideas:
+ Apply some basic EMA/SMA indicator script of your choice for easier understanding of the trend or to allow smooth transition to using this indicator.
+ Split the chart into two vertical layouts and applying this same script coupled with xdecow's 2 WWV candle painting script on both the layouts. Now you can use the left side of the chart to show all bearish move candles only (make the bullish candles transparent) and do the opposite for the right side of the chart. This way you enhance focus to just stick to one side at a given time.
Credits:
This indicator is a derivative of the fine work done originally by KivancOzbilgic
Here is the source to his original indicator: ).
Disclaimer:
This indicator and tip is for educational and entertainment purposes only. This not does constitute to financial advice of any sort.
[blackcat] L1 NinjaTrader ChannelNinjaTrader is a popular charting software widely used for trading analysis and execution in financial markets such as stocks, futures, and forex. It provides rich features and tools to assist traders in technical analysis, trade strategy development, and trade execution. When I discovered a built-in channel technical indicator in NinjaTrader and became interested in it but didn't understand its principles, I utilized my extensive development experience to simulate a similar version based on its characteristics, naming it "Ninja Channel" for reference only. First, I observed the characteristics and behavior of the built-in channel indicator. Pay attention to how it calculates and plots the channels, as well as its parameter settings and usage methods. This information can help me better understand the principles and functions of this indicator. Then, I attempted to simulate a similar channel indicator using my existing knowledge of technical analysis tools. I used charting tools and indicators to plot and calculate the upper and lower boundaries of the channel according to my needs and preferences. Please remember that this simulated version is for reference only; there is no guarantee that it will be exactly identical to the built-in channel indicator in NinjaTrader. The original built-in indicator may have more complex calculation methods with more precise results. Therefore, before engaging in actual trading activities, it is recommended that you carefully study and understand the principles and usage methods of the original indicator.
The Ninja Channel belongs to a type of technical indicator used for analyzing price range fluctuations and trends. It constructs an upper-lower boundary channel based on high-low points or moving average line fluctuations of prices to assist traders in determining overbought/oversold zones, trend strength/weaknesses,and price reversal points.
The main uses of Ninja Channel include:
1.Trend determination: The Ninja Channel helps traders determine price trends.When prices are located above half partofthechannel,it indicates an uptrend; when prices are located below half partofthechannel,it indicates adowntrend. Traders can formulate corresponding trading strategies based on trend analysis.
2.Overbought/oversold zones: The upper and lower boundaries of the Ninja Channel can be used to determine overbought and oversold zones.When prices touch or exceed the upper boundary of the channel, it may indicate an overbought market condition with a potential price pullback or reversal; when prices touch or fall below the lower boundary of the channel, it may indicate an oversold market condition with a potential price rebound or reversal.Traders can develop counter-trend or reversal trading strategies based on these overbought/oversold zones.
3.Dynamic support and resistance: The upper and lower boundaries of the Ninja Channel can be seen as dynamic support and resistance levels.When prices approach the upper boundary ofthechannel,theupperboundarymay act asresistance, limiting upward price movement; when prices approachthelowerboundaryofthechannel,thelowerboundarymayactassupport,limiting downward price movement.Traderscanmake trading decisions based on these dynamic supportandresistancelevels.
Of course, for this newly created indicator,some aspects are still unfamiliar.However,the learning process can refer to some common channel-type technical indicators including Bollinger Bands,Keltner Channels,and Donchian Channels. Each indicator has its unique calculation method and parameter settings.Traderscan choose suitable indicators according to their own needsandpreferences.
In summary,NinjaChannel is a type of technical indicator used for analyzingprice range fluctuationsandtrends.It helps traders determine trends,overbought/oversoldzones,anddynamic support/resistance levels in order to formulate appropriate trading strategies.However,technicalindicatorsareonly auxiliary tools.Traderstill needsto consider other factorsandsrisk managementstrategiesinorder tomakemore informedtradingdecisions.
Momentum ChannelbandsThe "Momentum Channelbands" is indicator that measures and displays an asset's momentum. It includes options to calculate Bollinger Bands and Donchian Channels around the momentum. Users can customize settings for a comprehensive view of momentum-related insights. This tool helps assess trend strength, identify overbought/oversold conditions, and pinpoint highs/lows. It should be used alongside other indicators due to potential lag and false signals.
[blackcat] L2 Votatility of Williams VixFix Risk AssessmentHey there! I previously wrote an article about the Larry Williams ViX Fix technical indicator. Soon after, friends from the TradingView community told me that this indicator could be combined with the Risk Assessment indicator I wrote about earlier to determine when to go long or short. At the time, I found it a bit cumbersome to use both indicators together, so I came up with a solution: to merge them. This way, we can use one technical indicator to visually see whether we should go long or short. Isn't that cool? The indicator has a very common name: ** L2 Votatility of Williams VixFix Risk Assessment, or VoWVRA for short.**
This TradingView Pine Script is a custom indicator based on the Larry Williams ViX Fix technical indicator, designed to help traders with risk assessment and trading decisions. The Larry Williams ViX Fix indicator is derived from the volatility of the S&P 500 index and is mainly used to display changes in current market sentiment. The indicator determines market volatility by calculating the distance between the highest price, the lowest price, and the closing price. The higher the value of the indicator, the more tense the market sentiment, and the higher the market volatility; conversely, the lower the value, the more stable the market sentiment and the lower the market volatility.
The VoWVRA indicator is based on the Larry Williams ViX Fix indicator, combined with technical indicators such as Bollinger Bands and EMA, to assess market risk. The indicator can be customized with input parameters to suit different markets and investor needs. Using the VoWVRA indicator can help traders make wiser choices in risk control and trading decisions.
In addition, this TradingView Pine Script also includes a risk assessment indicator. The indicator calculates a series of values and then applies the exponential moving average (EMA) to the percentage change between the closing price and the highest and lowest prices within a certain range to determine the safety level. The safety level is then compared to different thresholds to determine the market's risk level. The risk assessment indicator can be customized with input parameters such as risk length, safety length, and EMA length to suit different market conditions and investor preferences. Using the risk assessment indicator can help traders make wiser decisions in risk management and trading strategies.
By using the VoWVRA and risk assessment indicators, traders can more accurately assess market risk and make wiser choices in trading decisions.
Ichimoku MA BandsThis indicator is based on the price average of the Ichimoku Strategy taking into account the last twenty five bars.
The blue band represents an upward momentum whereas the white band represents a downward momentum.
The red line is the 50 EMA which is used as a dynamic support resistance level for this strategy.
This indicator also has alerts that can be enabled by the user.
Disclaimer :
The current script should be used in confluence with other trading strategies and not in isolation. The scripts works best on 5M and 15M Timeframes and should be used with caution on lower timeframes.
This indicator is not intended to give exact entry or exit points for a trade but to provide a general idea of the trend & determine a good range for entering or exiting the trade. Please DYOR
Credit & References :
This script uses the default technical analysis reference library provided by PineScript (denoted as ta)
IV Squeeze - Sunil Bhave This script calculates both Bollinger Bands and Keltner Channels on a 5-minute chart. It identifies IV squeeze conditions when the lower Bollinger Band is above the lower Keltner Channel and the upper Bollinger Band is below the upper Keltner Channel. When a squeeze is detected, it plots a red triangle below the chart bars and alerts you with a message.
Please note that this script is for educational purposes only.
Nadaraya-Watson Envelope Strategy (Non-Repainting) Log ScaleIn the diverse world of trading strategies, the Nadaraya-Watson Envelope Strategy offers a different approach. Grounded in mathematical analysis, this strategy utilizes the Nadaraya-Watson kernel regression, a method traditionally employed for interpreting complex data patterns.
At the core of this strategy lies the concept of 'envelopes', which are essentially dynamic volatility bands formed around the price based on a custom Average True Range (ATR). These envelopes help provide guidance on potential market entry and exit points. The strategy suggests considering a buy when the price crosses the lower envelope and a sell when it crosses the upper envelope.
One distinctive characteristic of the Nadaraya-Watson Envelope Strategy is its use of a logarithmic scale, as opposed to a linear scale. The logarithmic scale can be advantageous when dealing with larger timeframes and assets with wide-ranging price movements.
The strategy is implemented using Pine Script v5, and includes several adjustable parameters such as the lookback window, relative weighting, and the regression start point, providing a level of flexibility.
However, it's important to maintain a balanced view. While the use of mathematical models like the Nadaraya-Watson kernel regression may provide insightful data analysis, no strategy can guarantee success. Thorough backtesting, understanding the mathematical principles involved, and sound risk management are always essential when applying any trading strategy.
The Nadaraya-Watson Envelope Strategy thus offers another tool for traders to consider. As with all strategies, its effectiveness will largely depend on the trader's understanding, application, and the specific market conditions.
RAINBOW AVERAGES - INDICATOR - (AS) - 1/3
-INTRODUCTION:
This is the first of three scripts I intend to publish using rainbow indicators. This script serves as a groundwork for the other two. It is a RAINBOW MOVING AVERAGES indicator primarily designed for trend detection. The upcoming script will also be an indicator but with overlay=false (below the chart, not on it) and will utilize RAINBOW BANDS and RAINBOW OSCILLATOR. The third script will be a strategy combining all of them.
RAINBOW moving averages can be used in various ways, but this script is mainly intended for trend analysis. It is meant to be used with overlay=true, but if the user wishes, it can be viewed below the chart. To achieve this, you need to change the code from overlay=true to false and turn off the first switch that plots the rainbow on the chart (or simply move the indicator to a new pane below). By doing this, you will be able to see how all four conditions used to detect trends work on the chart. But let's not get ahead of ourselves.
-WHAT IS IT:
In its simplest form, this indicator uses 10 moving averages colored like a rainbow. The calculation is as follows:
MA0: This is the main moving average and can be defined with the type (SMA, EMA, RMA, WMA, SINE), length, and price source. However, the second moving average (MA1) is calculated using MA0 as its source, MA2 uses MA1 as the data source, and so on, until the last one, MA9. Hence, there are 10 moving averages. The first moving average is special as all the others derive from it. This indicator has many potential uses, such as entry/exit signals, volatility indication, and stop-loss placement, but for now, we will focus on trend detection.
-TREND DETECTION:
The indicator offers four different background color options based on the user's preference:
0-NONE: No background color is applied as no trend detection tools is being used (boring)
1-CHANGE: The background color is determined by summing the changes of all 10 moving averages (from two bars). If the sum is positive and not falling, the background color is GREEN. If the sum is negative and not rising, the background color is RED. From early testing, it works well for the beginning of a movement but not so much for a lasting trend.
2-RAINBW: The background color is green when all the moving averages are in ascending order, indicating a bullish trend. It is red when all the moving averages are in descending order, indicating a bearish trend. For example, if MA1>MA2>MA3>MA4..., the background color is green. If MA1 threshold, and red indicates width < -threshold.
4-DIRECT: The background color is determined by counting the number of moving averages that are either above or below the input source. If the specified number of moving averages is above the source, the background color is green. If the specified number of moving averages is below the source, the background color is red. If all ten MAs are below the price source, the indicator will show 10, and if all ten MAs are above, it will show -10. The specific value will be set later in the settings (same for 3-TSHOLD variant). This method works well for lasting trends.
Note: If the indicator is turned into a below-chart version, all four color options can be seen as separate indicators.
-PARAMETERS - SETTINGS:
The first line is an on/off switch to plot the skittles indicator (and some info in the tooltip). The second line has already been discussed, which is the background color and the selection of the source (only used for MA0!).
The line "MA1: TYP/LEN" is where we define the parameters of MA0 (important). We choose from the types of moving averages (SMA, EMA, RMA, WMA, SINE) and set the length.
Important Note: It says MA1, but it should be MA0!.
The next line defines whether we want to smooth MA1 (which is actually MA0) and the period for smoothing. When smoothing is turned on, MA0 will be smoothed using a 3-pole super smoother. It's worth noting that although this only applies to MA0, as the other MAs are derived from it, they will also be smoothed.
In the line below, we define the type and length of MAs for MA2 (and other MAs except MA0). The same type and length are used for MA1 to MA9. It's important to remember that these values should be smaller. For example, if we set 55, it means that MA1 is the average of 55 periods of MA0, MA2 will be 55 periods of MA1, and so on. I encourage trying different combinations of MA types as it can be easily adjusted for ur type of trading. RMA looks quirky.
Moving on to the last line, we define some inputs for the background color:
TSH: The threshold value when using 3-TSHOLD-BGC. It's a good idea to change the chart to a pane below for easier adjustment. The default values are based on EURUSD-5M.
BG_DIR: The value that must be crossed or equal to the MA score if using 4-DIRECT-BGC. There are 10 MAs, so the maximum value is also 10. For example, if you set it to 9, it means that at least 9 MAs must be below/above the price for the script to detect a trend. Higher values are recommended as most of the time, this indicator oscillates either around the maximum or minimum value.
-SUMMARY OF SETTINGS:
L1 - PLOT MAs and general info tooltip
L2 - Select the source for MA0 and type of trend detection.
L3 - Set the type and length of MA0 (important).
L4 - Turn smoothing on/off for MA0 and set the period for super smoothing.
L5 - Set the type and length for the rest of the MAs.
L6 - Set values if using 4-DIRECT or 3-TSHOLD for the trend detection.
-OTHERS:
To see trend indicators, you need to turn off the plotting of MAs (first line), and then choose the variant you want for the background color. This will plot it on the chart below.
Keep in mind that M1 int settings stands for MA0 and MA2 for all of the 9 MAs left.
Yes, it may seem more complicated than it actually is. In a nutshell, these are 10 MAs, and each one after MA0 uses the previous one as its source. Plus few conditions for range detection. rest is mainly plots and colors.
There are tooltips to help you with the parameters.
I hope this will be useful to someone. If you have any ideas, feedback, or spot errors in the code, LET ME KNOW.
Stay tuned for the remaining two scripts using skittles indicators and check out my other scripts.
-ALSO:
I'm always looking for ideas for interesting indicators and strategies that I could code, so if you don't know Pinescript, just message me, and I would be glad to write your own indicator/strategy for free, obviously.
-----May the force of the market be with you, and until we meet again,
Dynamic Trend RipperThe "Dynamic Trend Ripper" indicator is designed to identify dynamic support and resistance levels based on exponential moving averages (EMA) and the average true range (ATR). It aims to assist traders in identifying potential trading opportunities by visualizing dynamic support and resistance areas on the price chart. Think of it as more of overbought or oversold areas then true support and resistance,
The indicator calculates two sets of EMAs: two for the top cloud and two for the bottom cloud. The lengths of these EMAs are determined by user-defined input parameters. Additionally, the indicator uses the ATR to adjust the EMAs, enhancing their effectiveness as dynamic support and resistance levels.
The top cloud is formed by adding the ATR to the top fast EMA and subtracting the ATR from the top slow EMA. The bottom cloud is formed by subtracting the ATR from the bottom fast EMA and adding the ATR to the bottom slow EMA.
The indicator plots the dynamic OB (Overbought) level, which is the top fast EMA plus the ATR multiplied by the OBOS multiplier. It also plots the dynamic OS (Oversold) level, which is the top slow EMA minus the ATR multiplied by the OBOS multiplier. These levels are visualized using colored lines on the chart.
The top fast EMA, top slow EMA, bottom fast EMA, and bottom slow EMA are also plotted on the chart. The area between the top slow EMA and top fast EMA is filled with a color, forming the top cloud. The area between the bottom fast EMA and bottom slow EMA is filled with another color, forming the bottom cloud. The color of the clouds changes based on the relationship between the top fast EMA and top slow EMA. If the Regular Fast EMA is greater than the Regular slow EMA, indicating a bullish trend, the clouds are displayed in green. Otherwise, if the top fast EMA is less than the top slow EMA, indicating a bearish trend, the clouds are displayed in red.
The indicator can be used to identify potential support and resistance zones where the price may encounter obstacles or reverse its direction. Traders can look for price interactions with the dynamic support and resistance levels, as well as the OB and OS levels, to make trading decisions. For example, a trader might consider entering a short trade when the price approaches the top cloud, or a long trade when the price bounces off the bottom cloud.
By incorporating the ATR, which measures volatility, the indicator adjusts the EMAs to adapt to changing market conditions. Traders can watch for price reactions or reversals near these levels to gauge potential overextension or exhaustion in the price movement. I'm not going to claim this as my own idea, but I will say that I came up with this version myself. I haven't seen anyone else take this approach which is why I think it can be revolutionary to trading.
EXTREME OVERBOUGHT/SOLD BANDS
ATR-ADJUSTED EMA'S
