SuperTrend + Relative Volume (Kernel Optimized)

9 saat önce

Introducing our new KDE Optimized Supertrend + Relative Volume Indicator!

This innovative indicator combines the power of the Supertrend indicator along with Relative Volume. It utilizes the Kernel Density Estimation (KDE) to estimate the probability of a candlestick marking a significant trend break or reversal.

❓How to Interpret the KDE %:

The KDE % is a crucial metric that reflects the likelihood that the current candlestick represents a true break in the SuperTrend line, supported by an increase in relative volume. It estimates the probability of a trend shift or continuation based on historical SuperTrend breaks and volume patterns:

Low KDE %: A lower probability that the current break is significant. Price action is less likely to reverse, and the trend may continue.
Moderate KDE - High KDE %: An increased possibility that a trend reversal or consolidation could occur. Traders should start watching for confirmation signals.

📌How Does It Work?
The SuperTrend indicator uses the Average True Range (ATR) to determine the direction of the trend and identifies when the price crosses the SuperTrend line, signaling a potential trend reversal. Here's how the KDE Optimized SuperTrend Indicator works:

1. SuperTrend Calculation: The SuperTrend indicator is calculated, and when the price breaks above (bullish) or below (bearish) the SuperTrend line, it is logged as a significant event.
   
2. Relative Volume: For each break in the SuperTrend line, we calculate the relative volume (current volume vs. the average volume over a defined period). High relative volume can suggest stronger confirmation of the trend break.
   
3. KDE Array Calculation: KDE is applied to the break points and relative volume data:
   
4. Define the KDE options: Bandwidth, Number of Steps, and Array Range (Array Max - Array Min).
   
5. Create a density range array using the defined number of steps, corresponding to potential break points.
   
6. Apply a Gaussian kernel function to the break points and volume data to estimate the likelihood of the trend break being significant.
   
7. KDE Value and Signal Generation: The KDE array is updated as each break occurs. The KDE % is calculated for the breakout candlestick, representing the likelihood of the trend break being significant. If the KDE value exceeds the defined activation threshold, a darker bullish or bearish arrow is plotted after bar confirmation. If the KDE value falls below the threshold, a more transparent arrow is drawn, indicating a possible but lower probability break.
   

⚙️Settings:
SuperTrend Settings:

• ATR Length: The period over which the Average True Range (ATR) is calculated.
  
• Multiplier: The multiplier applied to the ATR to determine the SuperTrend threshold.
  

KDE Settings:

• Bandwidth: Determines the smoothness of the KDE function and the width of the influence of each break point.
  
• Number of Bins (Steps): Defines the precision of the KDE algorithm, with higher values offering more detailed calculations.
  
• KDE Threshold %: The level at which relative volume is considered significant for confirming a break.
  
• Relative Volume Length: The number of historic candles used in calculating KDE %
  

8 saat önce

Sürüm Notları

Updated KDE Limit

4 saat önce

Sürüm Notları

Updated default settings to improve ease of use

2 saat önce

Sürüm Notları

Split the KDE in two for bullish and bearish signals. Bullish and Bearish KDE's now use buy and sell volume respectively.