Weighted Multi-Mode Oscillator [BackQuant]

Weighted Multi‑Mode Oscillator [BackQuant]

1. What Is It?
The Weighted Multi‑Mode Oscillator (WMMO) is a next‑generation momentum tool that turns a dynamically‑weighted moving average into a 0‑100 bounded oscillator.
It lets you decide how each bar is weighted (by volume, volatility, momentum or a hybrid blend) and how the result is normalised (Percentile, Z‑Score or Min‑Max).
The outcome is a self‑adapting gauge that delivers crystal‑clear overbought / oversold zones, divergence clues and regime shifts on any market or timeframe.

2. How It Works
• Dynamic Weight Engine
  ▪ Volume – emphasises bars with exceptional participation.
  ▪ Volatility – inverse ATR weighting filters noisy spikes.
  ▪ Momentum – amplifies strong directional ROC bursts.
  ▪ Hybrid – equal‑weight blend of the three dimensions.

• Multi‑Mode Smoothing
  Choose from 8 MA types (EMA, DEMA, HMA, LINREG, TEMA, RMA, SMA, WMA) plus a secondary smoothing factor to fine‑tune lag vs. responsiveness.

• Normalization Suite
  ▪ Percentile – rank vs. recent history (context aware).
  ▪ Z‑Score – standard deviations from mean (statistical extremes).
  ▪ Min‑Max – scale between rolling high/low (trend friendly).

3. Reading the Oscillator

Zone Default Level Interpretation
Bull > 80 Acceleration; momentum buyers in control
Neutral 20 – 80 Consolidation / no edge
Bear < 20 Exhaustion; sellers dominate

Gradient line/area automatically shades from bright green (strong bull) to deep red (strong bear).
Optional bar‑painting colours price bars the same way for rapid chart scanning.

4. Typical Use‑Cases
Trend Confirmation – Set Weight = Hybrid, Smoothing = EMA. Enter pullbacks only when WMMO > 50 and rising.
Mean Reversion – Weight = Volatility, reduce upper / lower bands to 70 / 30 and fade extremes.
Volume Pulse – Intraday futures: Weight = Volume to catch participation surges before breakout candles.
Divergence Spotting – Compare price highs/lows to WMMO peaks for early reversal clues.

5. Inputs & Styling
Calculation: Source, MA Length, MA Type, Smoothing
Weighting: Volume period & factor, Volatility length, Momentum period
Normalisation: Method, Look‑back, Upper / Lower thresholds
Display: Gradient fills, Threshold lines, Bar‑colouring toggle, Line width & colours
All thresholds, colours and fills are fully customisable inside the settings panel.

6. Built‑In Alerts
WMMO Long – oscillator crosses up through upper threshold.
WMMO Short – oscillator crosses down through lower threshold.
Attach them once and receive push / e‑mail notifications the moment momentum flips.

7. Best Practices
Percentile mode is self‑adaptive and works well across assets; Z‑Score excels in ranges; Min‑Max shines in persistent trends.
Very short MA lengths (< 10) may produce jitter; compensate with higher “Smoothing” or longer look‑backs.
Pair WMMO with structure‑based tools (S/R, trend lines) for higher‑probability trade confluence.

Disclaimer
This script is provided for educational purposes only. It is not financial advice. Always back‑test thoroughly and manage risk before trading live capital.