As a third new weighted moving average I present the Volume-Volatility Weighted Moving Average.
The Volume-Volatility Weighted Moving Average (VVwma) calculates the average price over a certain period, weighted by both volume and volatilty, Big volume doesn't necessarily move price a lot but is very important, big price moves don't always need big volume but also have a lot of importance!
In this indicator both big volume moves as well as big price moves are factored in to calculate the ma behaviour.
The ma has a tendancy to quickly give an indication of a ranging vs trending market by angle of the ma. In ranging market it quickly flattens out and could be used to filter out insignificant low volume/volatility moves compared to regular ma's or the standard volume weighted ma
Another use of it could be as entry/exit signals or as a means of a trailing stop or a hard exit for a strategy or as a "baseline" to combine with other signals
feel free to experiment!!!
If you use the VVwma in your scripts or your work, a shoutout would be nice!!
This makes a fantastic exit indicator (and great for many other uses). When the price crosses and closes this line get out, just adjust the settings to your needs and test it.
Hi Duyck, I think that's what I was looking for. I have the V/V weighted ma (length 13) crossed with the 54 EMA in the 1-hour chart. It looks like my search may have ended. Theoretically. For now. Great work - I'm very happy with it.
Kind regards
Jack
Duyck
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@JackBerlin, hi, nice to hear, I have some more experimenting to do too.
Gr, JD.
JackBerlin
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@Duyck, a few months have now passed and I have now grown far beyond the development level of May 2020. But the V/V weighted ma is still part of my standard charting equipment.
UnknownUnicorn2955934
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holy smokes this is great! Follows massive drops and flatlines when ranging. Thanks!
Duyck
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@stluvin, Thanks for the feedback!
Gr, JD.
stevenwalter0
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This is great, i love your innovation this and the VAMA are a much better way to do moving averages. You are making the tesla of indicators.