On Chart Reverse PMARP

7 Nis

Introducing the On Chart Reverse PMARP

Concept

The PMAR/PMARP is an indicator which calculates :

The ratio between a chosen source price and a user defined moving average ( Price Moving Average Ratio ).
The percentile of the PMAR over an adjustable lookback period ( Price Moving Average Ratio Percentile ).

Here I have 'reverse engineered' the PMAR / PMARP formulas to derive several functions.

These functions calculate the chart price at which the PMARP will cross a particular PMARP level.

I have employed those functions here to give the "crossover" price levels for :

Scale high level
High alert level
High test level
Mid-Line
Low test level
Low alert level
Scale low level

Knowing the price at which these various user defined PMARP levels will be crossed can be useful in setting price levels that trigger components of various strategies.

For example: A trader can use the reverse engineered upper high alert price level, to set a take profit limit order on a long trade, which was entered when PMARP was low.

This 'On Chart' RPMARP indicator displays these 'reverse engineered' price levels as plotted lines on the chart.
This allows the user to see directly on the chart the interplay between the various crossover levels and price action.
This allows for more intuitive Technical Analysis, and allows traders to precisely plan entries, exits and stops for their PMARP based trades.

It optionally plots the user defined moving average from which the PMARP is derived.
It also optionally plots the 'Reverse engineered' midline, test level lines, visual alert level lines, scale max. and min. level lines, and background alert signal bars.

Main Properties :

Price Source :- Choice of price values or external value from another indicator ( default *Close ).
PMAR Length :- User defined time period to be used in calculating the Moving Average for the Price Moving Average Ratio and the PMAR component of the PMARP ( default *21 ).
MA Type :- User defined type of Moving Average which creates the MA for the Price Moving Average Ratio and the PMAR component of the PMARP ( default *EMA ).

Checkbox and color selection box for the optionally plotted Moving Average line.

Price Moving Average Ratio Percentile Properties :

PMARP Length :- The lookback period to be used in calculating the Price Moving Average Ratio Percentile ( default *350 ).

PMARP Level Settings :

Scale High :- Scale high level ( Locked at 100 ).
Hi Alert :- High alert level ( default *99 ).
Hi Test :- High test level ( default *70 ).
Lid Line :- Mid line level ( Locked at 50 ).
Lo Test :- Low test level ( default *30 ).
Lo Alert :- Low alert level ( default *1 ).
Scale Low :- Scale low level ( Locked at 0 ).

Checkboxes and color selection boxes for each of the optionally plotted lines.

PMARP MA Settings :

Checkbox to optionally plot 'reverse engineered' PMARP MA line.
PMARP MA Length :- The time period to be used in calculating the signal Moving Average for the Line Plot ( default *20 ).
PMARP MA Type :- The type of Moving Average which creates the signal Moving Average for the Line Plot ( default *EMA ).
Color Type :- User choice from dropdown between "single" or "dual" line color ( default *dual ).
Single Color :- Color selection box.
Dual Color :- Color selection box. Note: Defines the color of the signal MA when the MA is falling in "dual" line coloring mode.

Signal Bar Settings :

Signal Bars Transparency :- Sets the transparency of the vertical signal bars ( default *70 ).
Checkboxes and color selection boxes for Upper/Lower alert signal bars.