Cauchy Distribution Oscillator by c00l75ITALIANO: Questo script è un indicatore che non viene sovrapposto al grafico dei prezzi. Utilizza una finestra di lookback di 14 periodi (che può essere modificata dall’utente) per calcolare la distribuzione di Cauchy per ogni periodo.
La distribuzione di Cauchy è una distribuzione di probabilità continua che viene utilizzata in statistica. Ha una forma simile a quella della distribuzione normale, ma con code più pesanti. Questo significa che ha una maggiore probabilità di generare valori estremi rispetto alla distribuzione normale. E' una distribuzione di probabilità che descrive nel piano euclideo l'intersezione tra l'asse delle ascisse ed una retta passante per un punto fissato ed inclinata ad un angolo che segue la distribuzione continua uniforme.
Nello script, viene utilizzata una funzione che calcola il valore della distribuzione di Cauchy per un dato valore x, utilizzando altre 2 variabili per le quali ho impostato un valore fisso. Il risultato viene quindi memorizzato in un array e la media viene calcolata per tutti i valori nell’array.
E' un oscillatore un po' "estremo", che misura il momentum del prezzo in maniera decisa e per tanto, secondo la mia opinione, va utilizzato di concerto con altri indicatori per poter prendere decisioni consapevoli.
Ad ogni modo se vi piace mettete un "boost" e lasciate un commento se volete altre funzioni o modifiche su questo script.
ENGLISH: This script is an indicator that is not overlaid on the price chart. It uses a 14-period lookback window (which can be modified by the user) to calculate the Cauchy distribution for each period.
The Cauchy distribution is a continuous probability distribution that is used in statistics. It has a similar shape to the normal distribution, but with heavier tails. This means that it has a higher probability of generating extreme values than the normal distribution. It is a probability distribution that describes in the Euclidean plane the intersection of the x-axis and a line passing through a fixed point and inclined at an angle that follows the uniform continuous distribution.
In the script, a function is used that calculates the value of the Cauchy distribution for a given x value, using 2 other variables for which I set a fixed value. The result is then stored in an array and the mean is calculated for all the values in the array.
It is a somewhat "extreme" oscillator, measuring price momentum in a decisive way and therefore, in my opinion, should be used in concert with other indicators in order to make informed decisions.
Anyway if you like it put a "boost" and leave a comment if you want other functions or modifications on this script.
Ortalanmış Osilatörler
Basic Polychromatic Momentum IndicatorBasic Polychromatic Momentum Indicator with alerts
PMI involves taking the difference between the current price and the price n periods ago, and then subtracting from it the difference between the current price and the price n periods ago, divided by n. This gives a smoothed version of the momentum indicator.
The user can also specify a smoothing factor using the "smoothing" input, which applies a simple moving average to the PMI. The resulting smoothed PMI is plotted on the chart in blue, with a dotted gray line at the zero level.
Polychromatic Momentum IndicatorPolychromatic Momentum is a generalized Momentum study considering a number of Momentum values controlled by the length input. The greatest weight is given to the most recent Momentum value, while the precedent values are given lesser weight. Each Momentum value is assigned weight equal to inverse square root of Momentum distance (number of bars prior to the current bar). Then the sum of the weighted Momentum values is divided by the sum of the square roots.
GKD-C Smoother Momentum MACD w/ dual DSL [Loxx]Giga Kaleidoscope GKD-C Smoother Momentum MACD w/ dual DSL is a Confirmation module included in Loxx's "Giga Kaleidoscope Modularized Trading System".
█ GKD-C Smoother Momentum MACD w/ dual DSL
What is Smoother Momentum?
Smoother Momentum is a technical indicator used to evaluate the momentum of financial assets over a specific period. It is a popular tool among traders and analysts as it helps filter out noise from the price data and provides a clearer understanding of the underlying trend. The code snippet provided is a function, smmom(), that calculates the Smoother Momentum using a combination of Exponential Moving Averages (EMAs). In the following, we will delve into the concept of Smoother Momentum, its formulation, and the rationale behind the calculations.
Smoother Momentum Formula:
The Smoother Momentum calculation involves three EMAs with different smoothing factors. The function smmom() takes two input parameters: src, which represents the source data (such as price), and per, which represents the period for smoothing.
smmom(float src, float per)=>
float alphareg = 2.0 / (1.0 + per)
float alphadbl = 2.0 / (1.0 + math.sqrt(per))
float ema = src
float ema21 = src
float ema22 = src
if bar_index > 0
ema := nz(ema ) + alphareg * (src - nz(ema ))
ema21 := nz(ema21 ) + alphadbl * (src - nz(ema21 ))
ema22 := nz(ema22 ) + alphadbl * (ema21 - nz(ema22 ))
float out = (ema22 - ema)
out
The smoothing factors for the three EMAs are as follows:
alphareg = 2.0 / (1.0 + per)
alphadbl = 2.0 / (1.0 + sqrt(per))
These factors determine the degree of smoothing applied to the input data. The alphareg factor provides regular smoothing, while the alphadbl factor introduces a double smoothing effect.
The three EMAs are calculated as follows:
ema = src
ema21 = src
ema22 = src
For each bar index greater than zero, the EMAs are updated using the following formulas:
ema := nz(ema ) + alphareg * (src - nz(ema ))
ema21 := nz(ema21 ) + alphadbl * (src - nz(ema21 ))
ema22 := nz(ema22 ) + alphadbl * (ema21 - nz(ema22 ))
The Smoother Momentum (out) is then calculated as the difference between ema22 and ema:
out = (ema22 - ema)
Rationale Behind Smoother Momentum:
The Smoother Momentum indicator is designed to provide a refined view of an asset's momentum by employing multiple levels of smoothing. By incorporating the regular EMA (ema) and the double smoothed EMAs (ema21 and ema22), the indicator minimizes the impact of price fluctuations, resulting in a smoother momentum line.
The use of different smoothing factors allows the indicator to capture both short-term and long-term price movements, making it a valuable tool for various trading strategies. The Smoother Momentum provides traders with a better understanding of the underlying trend and helps them identify potential entry and exit points.
Smoother Momentum is a powerful technical indicator that offers valuable insights into an asset's momentum by leveraging a combination of Exponential Moving Averages with different smoothing factors. The smmom() function is an efficient implementation of the Smoother Momentum indicator, providing traders and analysts with a clear and concise view of the asset's underlying trend. By incorporating this indicator into their trading strategies, market participants can make more informed decisions and improve their overall performance.
What is the Moving Average Convergence Divergence (MACD)?
The Moving Average Convergence Divergence (MACD) is a widely-used technical indicator that measures the relationship between two Exponential Moving Averages (EMAs) of an asset's price. Developed by Gerald Appel in the 1970s, the MACD is employed by traders and analysts to identify trend reversals, bullish or bearish momentum, and potential entry or exit points in the market. This following will provide an in-depth understanding of the MACD, its formulation, and the rationale behind its calculations.
MACD Formula:
The MACD is derived from two Exponential Moving Averages of different periods, usually 12 and 26. The MACD line is calculated as the difference between the short-term (12-period) EMA and the long-term (26-period) EMA. Alongside the MACD line, a signal line, typically a 9-period EMA of the MACD line, is calculated. The interaction between the MACD line and the signal line forms the basis for generating trading signals.
Here are the formulas for calculating the MACD components:
1. Short-term EMA (12-period): EMA_short = EMA(price, 12)
2. Long-term EMA (26-period): EMA_long = EMA(price, 26)
3. MACD Line: MACD = EMA_short - EMA_long
4. Signal Line (9-period EMA of MACD): Signal = EMA(MACD, 9)
5. Additionally, the MACD Histogram represents the difference between the MACD line and the signal line, visualizing the degree of separation between the two lines.
MACD Histogram: Histogram = MACD - Signal
Rationale Behind MACD:
The MACD indicator is based on the principle that moving averages can provide insights into an asset's trend and momentum. By calculating the difference between two EMAs of different periods, the MACD line oscillates around the zero line, capturing the underlying trend and momentum of the asset. When the short-term EMA is above the long-term EMA, the MACD line is positive, indicating bullish momentum. Conversely, when the short-term EMA is below the long-term EMA, the MACD line is negative, signifying bearish momentum.
The signal line, a 9-period EMA of the MACD line, serves as a smoothing factor and a trigger for trading signals. When the MACD line crosses above the signal line, it generates a bullish signal, suggesting a potential buying opportunity. On the other hand, when the MACD line crosses below the signal line, it produces a bearish signal, indicating a possible selling opportunity.
The MACD Histogram visualizes the divergence between the MACD line and the signal line, helping traders assess the strength of the trend and the momentum. A widening histogram signifies an increasing divergence between the two lines, indicating stronger momentum, while a narrowing histogram denotes decreasing divergence, suggesting weakening momentum.
The Moving Average Convergence Divergence (MACD) is a powerful and versatile technical indicator that offers valuable insights into an asset's trend and momentum. By examining the interactions between the MACD line, the signal line, and the MACD Histogram, traders can identify potential trend reversals, bullish or bearish momentum, and entry or exit points in the market. The MACD's effectiveness in various market conditions and its compatibility with different trading strategies make it an indispensable tool for market participants seeking to make well-informed decisions and enhance their overall performance.
What is a Discontinued Signal Line (DSL)?
Many indicators employ signal lines to more easily identify trends or desired states of the indicator. The concept of a signal line is straightforward: by comparing a value to its smoothed, slightly lagging state, one can determine the current momentum or state.
The Discontinued Signal Line builds on this fundamental idea by extending it: rather than having a single signal line, multiple lines are used based on the indicator's current value.
The "signal" line is calculated as follows:
When a specific level is crossed in the desired direction, the EMA of that value is calculated for the intended signal line.
When that level is crossed in the opposite direction, the previous "signal" line value is "inherited," becoming a sort of level.
This approach combines signal lines and levels, aiming to integrate the advantages of both methods.
In essence, DSL enhances the signal line concept by inheriting the previous signal line's value and converting it into a level.
You can select between anchored and unanchored DSL, as well as utilize zero-line crosses without DSL.
What is the Smoother Momentum MACD w/ dual DSL?
This indicator uses the Smoother Momentum algorithm to calculate a MACD. Signals are created by middle crosses, signal crosses, or DSL crosses.
█ Giga Kaleidoscope Modularized Trading System
Core components of an NNFX algorithmic trading strategy
The NNFX algorithm is built on the principles of trend, momentum, and volatility. There are six core components in the NNFX trading algorithm:
1. Volatility - price volatility; e.g., Average True Range, True Range Double, Close-to-Close, etc.
2. Baseline - a moving average to identify price trend
3. Confirmation 1 - a technical indicator used to identify trends
4. Confirmation 2 - a technical indicator used to identify trends
5. Continuation - a technical indicator used to identify trends
6. Volatility/Volume - a technical indicator used to identify volatility/volume breakouts/breakdown
7. Exit - a technical indicator used to determine when a trend is exhausted
What is Volatility in the NNFX trading system?
In the NNFX (No Nonsense Forex) trading system, ATR (Average True Range) is typically used to measure the volatility of an asset. It is used as a part of the system to help determine the appropriate stop loss and take profit levels for a trade. ATR is calculated by taking the average of the true range values over a specified period.
True range is calculated as the maximum of the following values:
-Current high minus the current low
-Absolute value of the current high minus the previous close
-Absolute value of the current low minus the previous close
ATR is a dynamic indicator that changes with changes in volatility. As volatility increases, the value of ATR increases, and as volatility decreases, the value of ATR decreases. By using ATR in NNFX system, traders can adjust their stop loss and take profit levels according to the volatility of the asset being traded. This helps to ensure that the trade is given enough room to move, while also minimizing potential losses.
Other types of volatility include True Range Double (TRD), Close-to-Close, and Garman-Klass
What is a Baseline indicator?
The baseline is essentially a moving average, and is used to determine the overall direction of the market.
The baseline in the NNFX system is used to filter out trades that are not in line with the long-term trend of the market. The baseline is plotted on the chart along with other indicators, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR).
Trades are only taken when the price is in the same direction as the baseline. For example, if the baseline is sloping upwards, only long trades are taken, and if the baseline is sloping downwards, only short trades are taken. This approach helps to ensure that trades are in line with the overall trend of the market, and reduces the risk of entering trades that are likely to fail.
By using a baseline in the NNFX system, traders can have a clear reference point for determining the overall trend of the market, and can make more informed trading decisions. The baseline helps to filter out noise and false signals, and ensures that trades are taken in the direction of the long-term trend.
What is a Confirmation indicator?
Confirmation indicators are technical indicators that are used to confirm the signals generated by primary indicators. Primary indicators are the core indicators used in the NNFX system, such as the Average True Range (ATR), the Moving Average (MA), and the Relative Strength Index (RSI).
The purpose of the confirmation indicators is to reduce false signals and improve the accuracy of the trading system. They are designed to confirm the signals generated by the primary indicators by providing additional information about the strength and direction of the trend.
Some examples of confirmation indicators that may be used in the NNFX system include the Bollinger Bands, the MACD (Moving Average Convergence Divergence), and the MACD Oscillator. These indicators can provide information about the volatility, momentum, and trend strength of the market, and can be used to confirm the signals generated by the primary indicators.
In the NNFX system, confirmation indicators are used in combination with primary indicators and other filters to create a trading system that is robust and reliable. By using multiple indicators to confirm trading signals, the system aims to reduce the risk of false signals and improve the overall profitability of the trades.
What is a Continuation indicator?
In the NNFX (No Nonsense Forex) trading system, a continuation indicator is a technical indicator that is used to confirm a current trend and predict that the trend is likely to continue in the same direction. A continuation indicator is typically used in conjunction with other indicators in the system, such as a baseline indicator, to provide a comprehensive trading strategy.
What is a Volatility/Volume indicator?
Volume indicators, such as the On Balance Volume (OBV), the Chaikin Money Flow (CMF), or the Volume Price Trend (VPT), are used to measure the amount of buying and selling activity in a market. They are based on the trading volume of the market, and can provide information about the strength of the trend. In the NNFX system, volume indicators are used to confirm trading signals generated by the Moving Average and the Relative Strength Index. Volatility indicators include Average Direction Index, Waddah Attar, and Volatility Ratio. In the NNFX trading system, volatility is a proxy for volume and vice versa.
By using volume indicators as confirmation tools, the NNFX trading system aims to reduce the risk of false signals and improve the overall profitability of trades. These indicators can provide additional information about the market that is not captured by the primary indicators, and can help traders to make more informed trading decisions. In addition, volume indicators can be used to identify potential changes in market trends and to confirm the strength of price movements.
What is an Exit indicator?
The exit indicator is used in conjunction with other indicators in the system, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR), to provide a comprehensive trading strategy.
The exit indicator in the NNFX system can be any technical indicator that is deemed effective at identifying optimal exit points. Examples of exit indicators that are commonly used include the Parabolic SAR, the Average Directional Index (ADX), and the Chandelier Exit.
The purpose of the exit indicator is to identify when a trend is likely to reverse or when the market conditions have changed, signaling the need to exit a trade. By using an exit indicator, traders can manage their risk and prevent significant losses.
In the NNFX system, the exit indicator is used in conjunction with a stop loss and a take profit order to maximize profits and minimize losses. The stop loss order is used to limit the amount of loss that can be incurred if the trade goes against the trader, while the take profit order is used to lock in profits when the trade is moving in the trader's favor.
Overall, the use of an exit indicator in the NNFX trading system is an important component of a comprehensive trading strategy. It allows traders to manage their risk effectively and improve the profitability of their trades by exiting at the right time.
How does Loxx's GKD (Giga Kaleidoscope Modularized Trading System) implement the NNFX algorithm outlined above?
Loxx's GKD v1.0 system has five types of modules (indicators/strategies). These modules are:
1. GKD-BT - Backtesting module (Volatility, Number 1 in the NNFX algorithm)
2. GKD-B - Baseline module (Baseline and Volatility/Volume, Numbers 1 and 2 in the NNFX algorithm)
3. GKD-C - Confirmation 1/2 and Continuation module (Confirmation 1/2 and Continuation, Numbers 3, 4, and 5 in the NNFX algorithm)
4. GKD-V - Volatility/Volume module (Confirmation 1/2, Number 6 in the NNFX algorithm)
5. GKD-E - Exit module (Exit, Number 7 in the NNFX algorithm)
(additional module types will added in future releases)
Each module interacts with every module by passing data between modules. Data is passed between each module as described below:
GKD-B => GKD-V => GKD-C(1) => GKD-C(2) => GKD-C(Continuation) => GKD-E => GKD-BT
That is, the Baseline indicator passes its data to Volatility/Volume. The Volatility/Volume indicator passes its values to the Confirmation 1 indicator. The Confirmation 1 indicator passes its values to the Confirmation 2 indicator. The Confirmation 2 indicator passes its values to the Continuation indicator. The Continuation indicator passes its values to the Exit indicator, and finally, the Exit indicator passes its values to the Backtest strategy.
This chaining of indicators requires that each module conform to Loxx's GKD protocol, therefore allowing for the testing of every possible combination of technical indicators that make up the six components of the NNFX algorithm.
What does the application of the GKD trading system look like?
Example trading system:
Backtest: Strategy with 1-3 take profits, trailing stop loss, multiple types of PnL volatility, and 2 backtesting styles
Baseline: Hull Moving Average
Volatility/Volume: Hurst Exponent
Confirmation 1: Smoother Momentum MACD w/ dual DSL as shown on the chart above
Confirmation 2: Williams Percent Range
Continuation: Fisher Transform
Exit: Rex Oscillator
Each GKD indicator is denoted with a module identifier of either: GKD-BT, GKD-B, GKD-C, GKD-V, or GKD-E. This allows traders to understand to which module each indicator belongs and where each indicator fits into the GKD protocol chain.
Giga Kaleidoscope Modularized Trading System Signals (based on the NNFX algorithm)
Standard Entry
1. GKD-C Confirmation 1 Signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
6. GKD-C Confirmation 1 signal was less than 7 candles prior
Volatility/Volume Entry
1. GKD-V Volatility/Volume signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-B Baseline agrees
6. GKD-C Confirmation 1 signal was less than 7 candles prior
Continuation Entry
1. Standard Entry, Baseline Entry, or Pullback; entry triggered previously
2. GKD-B Baseline hasn't crossed since entry signal trigger
3. GKD-C Confirmation Continuation Indicator signals
4. GKD-C Confirmation 1 agrees
5. GKD-B Baseline agrees
6. GKD-C Confirmation 2 agrees
1-Candle Rule Standard Entry
1. GKD-C Confirmation 1 signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
1-Candle Rule Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 1 signal was less than 7 candles prior
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume Agrees
1-Candle Rule Volatility/Volume Entry
1. GKD-V Volatility/Volume signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 1 signal was less than 7 candles prior
Next Candle:
1. Price retraced (Long: close < close or Short: close > close)
2. GKD-B Volatility/Volume agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-B Baseline agrees
PullBack Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is beyond 1.0x Volatility of Baseline
Next Candle:
1. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
2. GKD-C Confirmation 1 agrees
3. GKD-C Confirmation 2 agrees
4. GKD-V Volatility/Volume Agrees
]█ Setting up the GKD
The GKD system involves chaining indicators together. These are the steps to set this up.
Use a GKD-C indicator alone on a chart
1. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Simple"
Use a GKD-V indicator alone on a chart
**nothing, it's already useable on the chart without any settings changes
Use a GKD-B indicator alone on a chart
**nothing, it's already useable on the chart without any settings changes
Baseline (Baseline, Backtest)
1. Import the GKD-B Baseline into the GKD-BT Backtest: "Input into Volatility/Volume or Backtest (Baseline testing)"
2. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Baseline"
Volatility/Volume (Volatility/Volume, Backte st)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Solo"
2. Inside the GKD-V indicator, change the "Signal Type" setting to "Crossing" (neither traditional nor both can be backtested)
3. Import the GKD-V indicator into the GKD-BT Backtest: "Input into C1 or Backtest"
4. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Volatility/Volume"
5. Inside the GKD-BT Backtest, a) change the setting "Backtest Type" to "Trading" if using a directional GKD-V indicator; or, b) change the setting "Backtest Type" to "Full" if using a directional or non-directional GKD-V indicator (non-directional GKD-V can only test Longs and Shorts separately)
6. If "Backtest Type" is set to "Full": Inside the GKD-BT Backtest, change the setting "Backtest Side" to "Long" or "Short
7. If "Backtest Type" is set to "Full": To allow the system to open multiple orders at one time so you test all Longs or Shorts, open the GKD-BT Backtest, click the tab "Properties" and then insert a value of something like 10 orders into the "Pyramiding" settings. This will allow 10 orders to be opened at one time which should be enough to catch all possible Longs or Shorts.
Solo Confirmation Simple (Confirmation, Backtest)
1. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Simple"
1. Import the GKD-C indicator into the GKD-BT Backtest: "Input into Backtest"
2. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Solo Confirmation Simple"
Solo Confirmation Complex without Exits (Baseline, Volatility/Volume, Confirmation, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Complex"
4. Import the GKD-V indicator into the GKD-C indicator: "Input into C1 or Backtest"
5. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full wo/ Exits"
6. Import the GKD-C into the GKD-BT Backtest: "Input into Exit or Backtest"
Solo Confirmation Complex with Exits (Baseline, Volatility/Volume, Confirmation, Exit, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Complex"
4. Import the GKD-V indicator into the GKD-C indicator: "Input into C1 or Backtest"
5. Import the GKD-C indicator into the GKD-E indicator: "Input into Exit"
6. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full w/ Exits"
7. Import the GKD-E into the GKD-BT Backtest: "Input into Backtest"
Full GKD without Exits (Baseline, Volatility/Volume, Confirmation 1, Confirmation 2, Continuation, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C 1 indicator, change the "Confirmation Type" setting to "Confirmation 1"
4. Import the GKD-V indicator into the GKD-C 1 indicator: "Input into C1 or Backtest"
5. Inside the GKD-C 2 indicator, change the "Confirmation Type" setting to "Confirmation 2"
6. Import the GKD-C 1 indicator into the GKD-C 2 indicator: "Input into C2"
7. Inside the GKD-C Continuation indicator, change the "Confirmation Type" setting to "Continuation"
8. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full wo/ Exits"
9. Import the GKD-E into the GKD-BT Backtest: "Input into Exit or Backtest"
Full GKD with Exits (Baseline, Volatility/Volume, Confirmation 1, Confirmation 2, Continuation, Exit, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C 1 indicator, change the "Confirmation Type" setting to "Confirmation 1"
4. Import the GKD-V indicator into the GKD-C 1 indicator: "Input into C1 or Backtest"
5. Inside the GKD-C 2 indicator, change the "Confirmation Type" setting to "Confirmation 2"
6. Import the GKD-C 1 indicator into the GKD-C 2 indicator: "Input into C2"
7. Inside the GKD-C Continuation indicator, change the "Confirmation Type" setting to "Continuation"
8. Import the GKD-C Continuation indicator into the GKD-E indicator: "Input into Exit"
9. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full w/ Exits"
10. Import the GKD-E into the GKD-BT Backtest: "Input into Backtest"
Baseline + Volatility/Volume (Baseline, Volatility/Volume, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Baseline + Volatility/Volume"
2. Inside the GKD-V indicator, make sure the "Signal Type" setting is set to "Traditional"
3. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
4. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Baseline + Volatility/Volume"
5. Import the GKD-V into the GKD-BT Backtest: "Input into C1 or Backtest"
6. Inside the GKD-BT Backtest, change the setting "Backtest Type" to "Full". For this backtest, you must test Longs and Shorts separately
7. To allow the system to open multiple orders at one time so you can test all Longs or Shorts, open the GKD-BT Backtest, click the tab "Properties" and then insert a value of something like 10 orders into the "Pyramiding" settings. This will allow 10 orders to be opened at one time which should be enough to catch all possible Longs or Shorts.
Requirements
Inputs
Confirmation 1: GKD-V Volatility / Volume indicator
Confirmation 2: GKD-C Confirmation indicator
Continuation: GKD-C Confirmation indicator
Solo Confirmation Simple: GKD-B Baseline
Solo Confirmation Complex: GKD-V Volatility / Volume indicator
Solo Confirmation Super Complex: GKD-V Volatility / Volume indicator
Stacked 1: None
Stacked 2+: GKD-C, GKD-V, or GKD-B Stacked 1
Outputs
Confirmation 1: GKD-C Confirmation 2 indicator
Confirmation 2: GKD-C Continuation indicator
Continuation: GKD-E Exit indicator
Solo Confirmation Simple: GKD-BT Backtest
Solo Confirmation Complex: GKD-BT Backtest or GKD-E Exit indicator
Solo Confirmation Super Complex: GKD-C Continuation indicator
Stacked 1: GKD-C, GKD-V, or GKD-B Stacked 2+
Stacked 2+: GKD-C, GKD-V, or GKD-B Stacked 2+ or GKD-BT Backtest
Additional features will be added in future releases.
RSI-ROC Momentum AlertThis is the RSI-ROC Momentum Alert trading indicator, designed to help traders identify potential buy and sell signals based on the momentum of price movements.
The indicator is based on two technical indicators: the Rate of Change (ROC) and the Relative Strength Index (RSI). The ROC measures the speed of price changes over a given period, while the RSI measures the strength of price movements. By combining these two indicators, this trading indicator aims to provide a comprehensive view of the market momentum.
An RSI below its oversold level, which shows as a green background, in addition to a ROC crossing above its moving average (turns green) signals a buying opportunity.
An RSI above its overbought level, which shows as a red background, in addition to a ROC crossing below its moving average (turns red) signals a selling opportunity.
Traders can use this indicator to identify potential momentum shifts and adjust their trading strategies accordingly.
The ROC component of the indicator uses a user-defined length parameter to calculate the ROC and a simple moving average (SMA) of the ROC. The color of the ROC line changes to green when it is above the ROC SMA and to red when it is below the ROC SMA. The ROC SMA color changes whether it's above or below a value of 0.
The RSI component of the indicator uses a user-defined length parameter to calculate the RSI, and user-defined RSI Low and RSI High values to identify potential buy and sell signals. When the RSI falls below the RSI Low value, a green background color is applied to the chart to indicate a potential buy signal. Conversely, when the RSI rises above the RSI High value, a red background color is applied to the chart to indicate a potential sell signal.
This indicator is intended to be used on any time frame and any asset, and can be customized at will.
GKD-C Step Chart of RSX of Averages [Loxx]Giga Kaleidoscope GKD-C Step Chart of RSX of Averages is a Confirmation module included in Loxx's "Giga Kaleidoscope Modularized Trading System".
█ GKD-C Step Chart of RSX of Averages
What is the RSX?
The Jurik RSX is a technical indicator developed by Mark Jurik to measure the momentum and strength of price movements in financial markets, such as stocks, commodities, and currencies. It is an advanced version of the traditional Relative Strength Index (RSI), designed to offer smoother and less lagging signals compared to the standard RSI.
The main advantage of the Jurik RSX is that it provides more accurate and timely signals for traders and analysts, thanks to its improved calculation methods that reduce noise and lag in the indicator's output. This enables better decision-making when analyzing market trends and potential trading opportunities.
A Comprehensive Analysis of the stepChart() Algorithm for Financial Technical Analysis
Technical analysis is a widely adopted method for forecasting financial market trends by evaluating historical price data and utilizing various statistical tools. We examine an algorithm that implements the stepChart() function, a custom indicator designed to assist traders in identifying trends and making more informed decisions. We will provide an in-depth analysis of the code, exploring its structure, purpose, and functionality.
The code can be divided into two main sections: the stepChart() function definition and its application to charting data. We will first examine the stepChart() function definition, followed by its application.
stepChart() Function Definition
The stepChart() function takes two arguments: a floating-point number 'srcprice' representing the source price and a simple integer 'stepSize' to determine the increment for evaluating trends.
Within the function, five floating-point variables are initialized: steps, trend, rtrend, rbar_high, and rbar_low. These variables will be used to compute the step chart values and store the trends and bar high/low values.
The 'bar_index' variable is employed to identify the current bar in the price chart. If the current bar is the first one (bar_index == 0), the function initializes the steps, rbar_high, rbar_low, trend, and rtrend variables using the source price and step size. If stepSize is greater than 0, the variables are initialized using the rounded value of srcprice divided by stepSize, multiplied by stepSize. Otherwise, they are initialized to srcprice.
In the following part of the function, the code checks if the absolute difference between the source price and the previous steps value is less than the step size. If true, the current steps value remains unchanged. If not, the code enters a while loop that continues incrementing or decrementing the steps value by the step size until the absolute difference between the source price and the steps value is less than or equal to the step size.
Next, the trend variable is calculated based on the relationship between the current steps value and the previous steps value. The rbar_high, rbar_low, and rtrend variables are updated accordingly.
Finally, the function returns a list containing rbar_high, rbar_low, and rtrend values.
Application of the stepChart() Function
In this section, the stepChart() function is applied to the RSX of the smoothed moving average of the closing prices of a financial instrument. The moving average and RSX functions are used to calculate the moving average and RSX, respectively.
The stepChart() function is called with the RSX values and the user-defined step size. The resulting values are stored in the rbar_high, rbar_low, and rtrend variables.
Next, the bar_high, bar_low, bar_close, and bar_open variables are set based on the values of rbar_high, rbar_low, and rtrend. These variables will be used to plot the stepChart() on the price chart. The bar_high variable is set to rbar_high, and the bar_low variable is set to rbar_high if rbar_high is equal to rbar_low, or to rbar_low otherwise. The bar_close variable is set to bar_high if rtrend equals 1, and to bar_low otherwise. Lastly, the bar_open variable is set to bar_low if rtrend equals 1, and to bar_high otherwise.
Finally, we use the built in Pine function plotcandle to plot the candles on the chart.
The stepChart() function is an innovative technical analysis tool designed to help traders identify trends in financial markets. By combining the RSX and moving average indicators and utilizing the step chart approach, this custom indicator provides a visually appealing and intuitive representation of price trends. Understanding the intricacies of this code can prove invaluable for traders looking to make well-informed decisions
Core components of an NNFX algorithmic trading strategy
The NNFX algorithm is built on the principles of trend, momentum, and volatility. There are six core components in the NNFX trading algorithm:
1. Volatility - price volatility; e.g., Average True Range, True Range Double, Close-to-Close, etc.
2. Baseline - a moving average to identify price trend
3. Confirmation 1 - a technical indicator used to identify trends
4. Confirmation 2 - a technical indicator used to identify trends
5. Continuation - a technical indicator used to identify trends
6. Volatility/Volume - a technical indicator used to identify volatility/volume breakouts/breakdown
7. Exit - a technical indicator used to determine when a trend is exhausted
What is Volatility in the NNFX trading system?
In the NNFX (No Nonsense Forex) trading system, ATR (Average True Range) is typically used to measure the volatility of an asset. It is used as a part of the system to help determine the appropriate stop loss and take profit levels for a trade. ATR is calculated by taking the average of the true range values over a specified period.
True range is calculated as the maximum of the following values:
-Current high minus the current low
-Absolute value of the current high minus the previous close
-Absolute value of the current low minus the previous close
ATR is a dynamic indicator that changes with changes in volatility. As volatility increases, the value of ATR increases, and as volatility decreases, the value of ATR decreases. By using ATR in NNFX system, traders can adjust their stop loss and take profit levels according to the volatility of the asset being traded. This helps to ensure that the trade is given enough room to move, while also minimizing potential losses.
Other types of volatility include True Range Double (TRD), Close-to-Close, and Garman-Klass
What is a Baseline indicator?
The baseline is essentially a moving average, and is used to determine the overall direction of the market.
The baseline in the NNFX system is used to filter out trades that are not in line with the long-term trend of the market. The baseline is plotted on the chart along with other indicators, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR).
Trades are only taken when the price is in the same direction as the baseline. For example, if the baseline is sloping upwards, only long trades are taken, and if the baseline is sloping downwards, only short trades are taken. This approach helps to ensure that trades are in line with the overall trend of the market, and reduces the risk of entering trades that are likely to fail.
By using a baseline in the NNFX system, traders can have a clear reference point for determining the overall trend of the market, and can make more informed trading decisions. The baseline helps to filter out noise and false signals, and ensures that trades are taken in the direction of the long-term trend.
What is a Confirmation indicator?
Confirmation indicators are technical indicators that are used to confirm the signals generated by primary indicators. Primary indicators are the core indicators used in the NNFX system, such as the Average True Range (ATR), the Moving Average (MA), and the Relative Strength Index (RSI).
The purpose of the confirmation indicators is to reduce false signals and improve the accuracy of the trading system. They are designed to confirm the signals generated by the primary indicators by providing additional information about the strength and direction of the trend.
Some examples of confirmation indicators that may be used in the NNFX system include the Bollinger Bands, the MACD (Moving Average Convergence Divergence), and the MACD Oscillator. These indicators can provide information about the volatility, momentum, and trend strength of the market, and can be used to confirm the signals generated by the primary indicators.
In the NNFX system, confirmation indicators are used in combination with primary indicators and other filters to create a trading system that is robust and reliable. By using multiple indicators to confirm trading signals, the system aims to reduce the risk of false signals and improve the overall profitability of the trades.
What is a Continuation indicator?
In the NNFX (No Nonsense Forex) trading system, a continuation indicator is a technical indicator that is used to confirm a current trend and predict that the trend is likely to continue in the same direction. A continuation indicator is typically used in conjunction with other indicators in the system, such as a baseline indicator, to provide a comprehensive trading strategy.
What is a Volatility/Volume indicator?
Volume indicators, such as the On Balance Volume (OBV), the Chaikin Money Flow (CMF), or the Volume Price Trend (VPT), are used to measure the amount of buying and selling activity in a market. They are based on the trading volume of the market, and can provide information about the strength of the trend. In the NNFX system, volume indicators are used to confirm trading signals generated by the Moving Average and the Relative Strength Index. Volatility indicators include Average Direction Index, Waddah Attar, and Volatility Ratio. In the NNFX trading system, volatility is a proxy for volume and vice versa.
By using volume indicators as confirmation tools, the NNFX trading system aims to reduce the risk of false signals and improve the overall profitability of trades. These indicators can provide additional information about the market that is not captured by the primary indicators, and can help traders to make more informed trading decisions. In addition, volume indicators can be used to identify potential changes in market trends and to confirm the strength of price movements.
What is an Exit indicator?
The exit indicator is used in conjunction with other indicators in the system, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR), to provide a comprehensive trading strategy.
The exit indicator in the NNFX system can be any technical indicator that is deemed effective at identifying optimal exit points. Examples of exit indicators that are commonly used include the Parabolic SAR, the Average Directional Index (ADX), and the Chandelier Exit.
The purpose of the exit indicator is to identify when a trend is likely to reverse or when the market conditions have changed, signaling the need to exit a trade. By using an exit indicator, traders can manage their risk and prevent significant losses.
In the NNFX system, the exit indicator is used in conjunction with a stop loss and a take profit order to maximize profits and minimize losses. The stop loss order is used to limit the amount of loss that can be incurred if the trade goes against the trader, while the take profit order is used to lock in profits when the trade is moving in the trader's favor.
Overall, the use of an exit indicator in the NNFX trading system is an important component of a comprehensive trading strategy. It allows traders to manage their risk effectively and improve the profitability of their trades by exiting at the right time.
How does Loxx's GKD (Giga Kaleidoscope Modularized Trading System) implement the NNFX algorithm outlined above?
Loxx's GKD v1.0 system has five types of modules (indicators/strategies). These modules are:
1. GKD-BT - Backtesting module (Volatility, Number 1 in the NNFX algorithm)
2. GKD-B - Baseline module (Baseline and Volatility/Volume, Numbers 1 and 2 in the NNFX algorithm)
3. GKD-C - Confirmation 1/2 and Continuation module (Confirmation 1/2 and Continuation, Numbers 3, 4, and 5 in the NNFX algorithm)
4. GKD-V - Volatility/Volume module (Confirmation 1/2, Number 6 in the NNFX algorithm)
5. GKD-E - Exit module (Exit, Number 7 in the NNFX algorithm)
(additional module types will added in future releases)
Each module interacts with every module by passing data between modules. Data is passed between each module as described below:
GKD-B => GKD-V => GKD-C(1) => GKD-C(2) => GKD-C(Continuation) => GKD-E => GKD-BT
That is, the Baseline indicator passes its data to Volatility/Volume. The Volatility/Volume indicator passes its values to the Confirmation 1 indicator. The Confirmation 1 indicator passes its values to the Confirmation 2 indicator. The Confirmation 2 indicator passes its values to the Continuation indicator. The Continuation indicator passes its values to the Exit indicator, and finally, the Exit indicator passes its values to the Backtest strategy.
This chaining of indicators requires that each module conform to Loxx's GKD protocol, therefore allowing for the testing of every possible combination of technical indicators that make up the six components of the NNFX algorithm.
What does the application of the GKD trading system look like?
Example trading system:
Backtest: Strategy with 1-3 take profits, trailing stop loss, multiple types of PnL volatility, and 2 backtesting styles
Baseline: Hull Moving Average
Volatility/Volume: Hurst Exponent
Confirmation 1: Step Chart of RSX of Averages as shown on the chart above
Confirmation 2: Williams Percent Range
Continuation: Fisher Transform
Exit: Rex Oscillator
Each GKD indicator is denoted with a module identifier of either: GKD-BT, GKD-B, GKD-C, GKD-V, or GKD-E. This allows traders to understand to which module each indicator belongs and where each indicator fits into the GKD protocol chain.
Giga Kaleidoscope Modularized Trading System Signals (based on the NNFX algorithm)
Standard Entry
1. GKD-C Confirmation 1 Signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
6. GKD-C Confirmation 1 signal was less than 7 candles prior
Volatility/Volume Entry
1. GKD-V Volatility/Volume signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-B Baseline agrees
6. GKD-C Confirmation 1 signal was less than 7 candles prior
Continuation Entry
1. Standard Entry, Baseline Entry, or Pullback; entry triggered previously
2. GKD-B Baseline hasn't crossed since entry signal trigger
3. GKD-C Confirmation Continuation Indicator signals
4. GKD-C Confirmation 1 agrees
5. GKD-B Baseline agrees
6. GKD-C Confirmation 2 agrees
1-Candle Rule Standard Entry
1. GKD-C Confirmation 1 signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
1-Candle Rule Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 1 signal was less than 7 candles prior
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume Agrees
1-Candle Rule Volatility/Volume Entry
1. GKD-V Volatility/Volume signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 1 signal was less than 7 candles prior
Next Candle:
1. Price retraced (Long: close < close or Short: close > close)
2. GKD-B Volatility/Volume agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-B Baseline agrees
PullBack Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is beyond 1.0x Volatility of Baseline
Next Candle:
1. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
2. GKD-C Confirmation 1 agrees
3. GKD-C Confirmation 2 agrees
4. GKD-V Volatility/Volume Agrees
]█ Setting up the GKD
The GKD system involves chaining indicators together. These are the steps to set this up.
Use a GKD-C indicator alone on a chart
1. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Simple"
Use a GKD-V indicator alone on a chart
**nothing, it's already useable on the chart without any settings changes
Use a GKD-B indicator alone on a chart
**nothing, it's already useable on the chart without any settings changes
Baseline (Baseline, Backtest)
1. Import the GKD-B Baseline into the GKD-BT Backtest: "Input into Volatility/Volume or Backtest (Baseline testing)"
2. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Baseline"
Volatility/Volume (Volatility/Volume, Backte st)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Solo"
2. Inside the GKD-V indicator, change the "Signal Type" setting to "Crossing" (neither traditional nor both can be backtested)
3. Import the GKD-V indicator into the GKD-BT Backtest: "Input into C1 or Backtest"
4. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Volatility/Volume"
5. Inside the GKD-BT Backtest, a) change the setting "Backtest Type" to "Trading" if using a directional GKD-V indicator; or, b) change the setting "Backtest Type" to "Full" if using a directional or non-directional GKD-V indicator (non-directional GKD-V can only test Longs and Shorts separately)
6. If "Backtest Type" is set to "Full": Inside the GKD-BT Backtest, change the setting "Backtest Side" to "Long" or "Short
7. If "Backtest Type" is set to "Full": To allow the system to open multiple orders at one time so you test all Longs or Shorts, open the GKD-BT Backtest, click the tab "Properties" and then insert a value of something like 10 orders into the "Pyramiding" settings. This will allow 10 orders to be opened at one time which should be enough to catch all possible Longs or Shorts.
Solo Confirmation Simple (Confirmation, Backtest)
1. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Simple"
1. Import the GKD-C indicator into the GKD-BT Backtest: "Input into Backtest"
2. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Solo Confirmation Simple"
Solo Confirmation Complex without Exits (Baseline, Volatility/Volume, Confirmation, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Complex"
4. Import the GKD-V indicator into the GKD-C indicator: "Input into C1 or Backtest"
5. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full wo/ Exits"
6. Import the GKD-C into the GKD-BT Backtest: "Input into Exit or Backtest"
Solo Confirmation Complex with Exits (Baseline, Volatility/Volume, Confirmation, Exit, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Complex"
4. Import the GKD-V indicator into the GKD-C indicator: "Input into C1 or Backtest"
5. Import the GKD-C indicator into the GKD-E indicator: "Input into Exit"
6. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full w/ Exits"
7. Import the GKD-E into the GKD-BT Backtest: "Input into Backtest"
Full GKD without Exits (Baseline, Volatility/Volume, Confirmation 1, Confirmation 2, Continuation, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C 1 indicator, change the "Confirmation Type" setting to "Confirmation 1"
4. Import the GKD-V indicator into the GKD-C 1 indicator: "Input into C1 or Backtest"
5. Inside the GKD-C 2 indicator, change the "Confirmation Type" setting to "Confirmation 2"
6. Import the GKD-C 1 indicator into the GKD-C 2 indicator: "Input into C2"
7. Inside the GKD-C Continuation indicator, change the "Confirmation Type" setting to "Continuation"
8. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full wo/ Exits"
9. Import the GKD-E into the GKD-BT Backtest: "Input into Exit or Backtest"
Full GKD with Exits (Baseline, Volatility/Volume, Confirmation 1, Confirmation 2, Continuation, Exit, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C 1 indicator, change the "Confirmation Type" setting to "Confirmation 1"
4. Import the GKD-V indicator into the GKD-C 1 indicator: "Input into C1 or Backtest"
5. Inside the GKD-C 2 indicator, change the "Confirmation Type" setting to "Confirmation 2"
6. Import the GKD-C 1 indicator into the GKD-C 2 indicator: "Input into C2"
7. Inside the GKD-C Continuation indicator, change the "Confirmation Type" setting to "Continuation"
8. Import the GKD-C Continuation indicator into the GKD-E indicator: "Input into Exit"
9. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full w/ Exits"
10. Import the GKD-E into the GKD-BT Backtest: "Input into Backtest"
Baseline + Volatility/Volume (Baseline, Volatility/Volume, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Baseline + Volatility/Volume"
2. Inside the GKD-V indicator, make sure the "Signal Type" setting is set to "Traditional"
3. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
4. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Baseline + Volatility/Volume"
5. Import the GKD-V into the GKD-BT Backtest: "Input into C1 or Backtest"
6. Inside the GKD-BT Backtest, change the setting "Backtest Type" to "Full". For this backtest, you must test Longs and Shorts separately
7. To allow the system to open multiple orders at one time so you can test all Longs or Shorts, open the GKD-BT Backtest, click the tab "Properties" and then insert a value of something like 10 orders into the "Pyramiding" settings. This will allow 10 orders to be opened at one time which should be enough to catch all possible Longs or Shorts.
Requirements
Inputs
Confirmation 1: GKD-V Volatility / Volume indicator
Confirmation 2: GKD-C Confirmation indicator
Continuation: GKD-C Confirmation indicator
Solo Confirmation Simple: GKD-B Baseline
Solo Confirmation Complex: GKD-V Volatility / Volume indicator
Solo Confirmation Super Complex: GKD-V Volatility / Volume indicator
Stacked 1: None
Stacked 2+: GKD-C, GKD-V, or GKD-B Stacked 1
Outputs
Confirmation 1: GKD-C Confirmation 2 indicator
Confirmation 2: GKD-C Continuation indicator
Continuation: GKD-E Exit indicator
Solo Confirmation Simple: GKD-BT Backtest
Solo Confirmation Complex: GKD-BT Backtest or GKD-E Exit indicator
Solo Confirmation Super Complex: GKD-C Continuation indicator
Stacked 1: GKD-C, GKD-V, or GKD-B Stacked 2+
Stacked 2+: GKD-C, GKD-V, or GKD-B Stacked 2+ or GKD-BT Backtest
Additional features will be added in future releases.
GKD-C RAVI Fisher Transform [Loxx]Giga Kaleidoscope GKD-C RAVI Fisher Transform is a Confirmation module included in Loxx's "Giga Kaleidoscope Modularized Trading System".
█ Giga Kaleidoscope Modularized Trading System
What is Loxx's "Giga Kaleidoscope Modularized Trading System"?
The Giga Kaleidoscope Modularized Trading System is a trading system built on the philosophy of the NNFX (No Nonsense Forex) algorithmic trading.
What is the NNFX algorithmic trading strategy?
The NNFX (No-Nonsense Forex) trading system is a comprehensive approach to Forex trading that is designed to simplify the process and remove the confusion and complexity that often surrounds trading. The system was developed by a Forex trader who goes by the pseudonym "VP" and has gained a significant following in the Forex community.
The NNFX trading system is based on a set of rules and guidelines that help traders make objective and informed decisions. These rules cover all aspects of trading, including market analysis, trade entry, stop loss placement, and trade management.
Here are the main components of the NNFX trading system:
1. Trading Philosophy: The NNFX trading system is based on the idea that successful trading requires a comprehensive understanding of the market, objective analysis, and strict risk management. The system aims to remove subjective elements from trading and focuses on objective rules and guidelines.
2. Technical Analysis: The NNFX trading system relies heavily on technical analysis and uses a range of indicators to identify high-probability trading opportunities. The system uses a combination of trend-following and mean-reverting strategies to identify trades.
3. Market Structure: The NNFX trading system emphasizes the importance of understanding the market structure, including price action, support and resistance levels, and market cycles. The system uses a range of tools to identify the market structure, including trend lines, channels, and moving averages.
4. Trade Entry: The NNFX trading system has strict rules for trade entry. The system uses a combination of technical indicators to identify high-probability trades, and traders must meet specific criteria to enter a trade.
5. Stop Loss Placement: The NNFX trading system places a significant emphasis on risk management and requires traders to place a stop loss order on every trade. The system uses a combination of technical analysis and market structure to determine the appropriate stop loss level.
6. Trade Management: The NNFX trading system has specific rules for managing open trades. The system aims to minimize risk and maximize profit by using a combination of trailing stops, take profit levels, and position sizing.
Overall, the NNFX trading system is designed to be a straightforward and easy-to-follow approach to Forex trading that can be applied by traders of all skill levels.
Core components of an NNFX algorithmic trading strategy
The NNFX algorithm is built on the principles of trend, momentum, and volatility. There are six core components in the NNFX trading algorithm:
1. Volatility - price volatility; e.g., Average True Range, True Range Double, Close-to-Close, etc.
2. Baseline - a moving average to identify price trend
3. Confirmation 1 - a technical indicator used to identify trends
4. Confirmation 2 - a technical indicator used to identify trends
5. Continuation - a technical indicator used to identify trends
6. Volatility/Volume - a technical indicator used to identify volatility/volume breakouts/breakdown
7. Exit - a technical indicator used to determine when a trend is exhausted
What is Volatility in the NNFX trading system?
In the NNFX (No Nonsense Forex) trading system, ATR (Average True Range) is typically used to measure the volatility of an asset. It is used as a part of the system to help determine the appropriate stop loss and take profit levels for a trade. ATR is calculated by taking the average of the true range values over a specified period.
True range is calculated as the maximum of the following values:
-Current high minus the current low
-Absolute value of the current high minus the previous close
-Absolute value of the current low minus the previous close
ATR is a dynamic indicator that changes with changes in volatility. As volatility increases, the value of ATR increases, and as volatility decreases, the value of ATR decreases. By using ATR in NNFX system, traders can adjust their stop loss and take profit levels according to the volatility of the asset being traded. This helps to ensure that the trade is given enough room to move, while also minimizing potential losses.
Other types of volatility include True Range Double (TRD), Close-to-Close, and Garman-Klass
What is a Baseline indicator?
The baseline is essentially a moving average, and is used to determine the overall direction of the market.
The baseline in the NNFX system is used to filter out trades that are not in line with the long-term trend of the market. The baseline is plotted on the chart along with other indicators, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR).
Trades are only taken when the price is in the same direction as the baseline. For example, if the baseline is sloping upwards, only long trades are taken, and if the baseline is sloping downwards, only short trades are taken. This approach helps to ensure that trades are in line with the overall trend of the market, and reduces the risk of entering trades that are likely to fail.
By using a baseline in the NNFX system, traders can have a clear reference point for determining the overall trend of the market, and can make more informed trading decisions. The baseline helps to filter out noise and false signals, and ensures that trades are taken in the direction of the long-term trend.
What is a Confirmation indicator?
Confirmation indicators are technical indicators that are used to confirm the signals generated by primary indicators. Primary indicators are the core indicators used in the NNFX system, such as the Average True Range (ATR), the Moving Average (MA), and the Relative Strength Index (RSI).
The purpose of the confirmation indicators is to reduce false signals and improve the accuracy of the trading system. They are designed to confirm the signals generated by the primary indicators by providing additional information about the strength and direction of the trend.
Some examples of confirmation indicators that may be used in the NNFX system include the Bollinger Bands, the MACD (Moving Average Convergence Divergence), and the MACD Oscillator. These indicators can provide information about the volatility, momentum, and trend strength of the market, and can be used to confirm the signals generated by the primary indicators.
In the NNFX system, confirmation indicators are used in combination with primary indicators and other filters to create a trading system that is robust and reliable. By using multiple indicators to confirm trading signals, the system aims to reduce the risk of false signals and improve the overall profitability of the trades.
What is a Continuation indicator?
In the NNFX (No Nonsense Forex) trading system, a continuation indicator is a technical indicator that is used to confirm a current trend and predict that the trend is likely to continue in the same direction. A continuation indicator is typically used in conjunction with other indicators in the system, such as a baseline indicator, to provide a comprehensive trading strategy.
What is a Volatility/Volume indicator?
Volume indicators, such as the On Balance Volume (OBV), the Chaikin Money Flow (CMF), or the Volume Price Trend (VPT), are used to measure the amount of buying and selling activity in a market. They are based on the trading volume of the market, and can provide information about the strength of the trend. In the NNFX system, volume indicators are used to confirm trading signals generated by the Moving Average and the Relative Strength Index. Volatility indicators include Average Direction Index, Waddah Attar, and Volatility Ratio. In the NNFX trading system, volatility is a proxy for volume and vice versa.
By using volume indicators as confirmation tools, the NNFX trading system aims to reduce the risk of false signals and improve the overall profitability of trades. These indicators can provide additional information about the market that is not captured by the primary indicators, and can help traders to make more informed trading decisions. In addition, volume indicators can be used to identify potential changes in market trends and to confirm the strength of price movements.
What is an Exit indicator?
The exit indicator is used in conjunction with other indicators in the system, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR), to provide a comprehensive trading strategy.
The exit indicator in the NNFX system can be any technical indicator that is deemed effective at identifying optimal exit points. Examples of exit indicators that are commonly used include the Parabolic SAR, the Average Directional Index (ADX), and the Chandelier Exit.
The purpose of the exit indicator is to identify when a trend is likely to reverse or when the market conditions have changed, signaling the need to exit a trade. By using an exit indicator, traders can manage their risk and prevent significant losses.
In the NNFX system, the exit indicator is used in conjunction with a stop loss and a take profit order to maximize profits and minimize losses. The stop loss order is used to limit the amount of loss that can be incurred if the trade goes against the trader, while the take profit order is used to lock in profits when the trade is moving in the trader's favor.
Overall, the use of an exit indicator in the NNFX trading system is an important component of a comprehensive trading strategy. It allows traders to manage their risk effectively and improve the profitability of their trades by exiting at the right time.
How does Loxx's GKD (Giga Kaleidoscope Modularized Trading System) implement the NNFX algorithm outlined above?
Loxx's GKD v1.0 system has five types of modules (indicators/strategies). These modules are:
1. GKD-BT - Backtesting module (Volatility, Number 1 in the NNFX algorithm)
2. GKD-B - Baseline module (Baseline and Volatility/Volume, Numbers 1 and 2 in the NNFX algorithm)
3. GKD-C - Confirmation 1/2 and Continuation module (Confirmation 1/2 and Continuation, Numbers 3, 4, and 5 in the NNFX algorithm)
4. GKD-V - Volatility/Volume module (Confirmation 1/2, Number 6 in the NNFX algorithm)
5. GKD-E - Exit module (Exit, Number 7 in the NNFX algorithm)
(additional module types will added in future releases)
Each module interacts with every module by passing data between modules. Data is passed between each module as described below:
GKD-B => GKD-V => GKD-C(1) => GKD-C(2) => GKD-C(Continuation) => GKD-E => GKD-BT
That is, the Baseline indicator passes its data to Volatility/Volume. The Volatility/Volume indicator passes its values to the Confirmation 1 indicator. The Confirmation 1 indicator passes its values to the Confirmation 2 indicator. The Confirmation 2 indicator passes its values to the Continuation indicator. The Continuation indicator passes its values to the Exit indicator, and finally, the Exit indicator passes its values to the Backtest strategy.
This chaining of indicators requires that each module conform to Loxx's GKD protocol, therefore allowing for the testing of every possible combination of technical indicators that make up the six components of the NNFX algorithm.
What does the application of the GKD trading system look like?
Example trading system:
Backtest: Strategy with 1-3 take profits, trailing stop loss, multiple types of PnL volatility, and 2 backtesting styles
Baseline: Hull Moving Average
Volatility/Volume: Hurst Exponent
Confirmation 1: RAVI Fisher Transform as shown on the chart above
Confirmation 2: Williams Percent Range
Continuation: Fisher Transform
Exit: Rex Oscillator
Each GKD indicator is denoted with a module identifier of either: GKD-BT, GKD-B, GKD-C, GKD-V, or GKD-E. This allows traders to understand to which module each indicator belongs and where each indicator fits into the GKD protocol chain.
Giga Kaleidoscope Modularized Trading System Signals (based on the NNFX algorithm)
Standard Entry
1. GKD-C Confirmation 1 Signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
6. GKD-C Confirmation 1 signal was less than 7 candles prior
Volatility/Volume Entry
1. GKD-V Volatility/Volume signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-B Baseline agrees
6. GKD-C Confirmation 1 signal was less than 7 candles prior
Continuation Entry
1. Standard Entry, Baseline Entry, or Pullback; entry triggered previously
2. GKD-B Baseline hasn't crossed since entry signal trigger
3. GKD-C Confirmation Continuation Indicator signals
4. GKD-C Confirmation 1 agrees
5. GKD-B Baseline agrees
6. GKD-C Confirmation 2 agrees
1-Candle Rule Standard Entry
1. GKD-C Confirmation 1 signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
1-Candle Rule Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 1 signal was less than 7 candles prior
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume Agrees
1-Candle Rule Volatility/Volume Entry
1. GKD-V Volatility/Volume signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 1 signal was less than 7 candles prior
Next Candle:
1. Price retraced (Long: close < close or Short: close > close)
2. GKD-B Volatility/Volume agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-B Baseline agrees
PullBack Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is beyond 1.0x Volatility of Baseline
Next Candle:
1. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
2. GKD-C Confirmation 1 agrees
3. GKD-C Confirmation 2 agrees
4. GKD-V Volatility/Volume Agrees
]█ Setting up the GKD
The GKD system involves chaining indicators together. These are the steps to set this up.
Use a GKD-C indicator alone on a chart
1. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Simple"
Use a GKD-V indicator alone on a chart
**nothing, it's already useable on the chart without any settings changes
Use a GKD-B indicator alone on a chart
**nothing, it's already useable on the chart without any settings changes
Baseline (Baseline, Backtest)
1. Import the GKD-B Baseline into the GKD-BT Backtest: "Input into Volatility/Volume or Backtest (Baseline testing)"
2. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Baseline"
Volatility/Volume (Volatility/Volume, Backte st)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Solo"
2. Inside the GKD-V indicator, change the "Signal Type" setting to "Crossing" (neither traditional nor both can be backtested)
3. Import the GKD-V indicator into the GKD-BT Backtest: "Input into C1 or Backtest"
4. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Volatility/Volume"
5. Inside the GKD-BT Backtest, a) change the setting "Backtest Type" to "Trading" if using a directional GKD-V indicator; or, b) change the setting "Backtest Type" to "Full" if using a directional or non-directional GKD-V indicator (non-directional GKD-V can only test Longs and Shorts separately)
6. If "Backtest Type" is set to "Full": Inside the GKD-BT Backtest, change the setting "Backtest Side" to "Long" or "Short
7. If "Backtest Type" is set to "Full": To allow the system to open multiple orders at one time so you test all Longs or Shorts, open the GKD-BT Backtest, click the tab "Properties" and then insert a value of something like 10 orders into the "Pyramiding" settings. This will allow 10 orders to be opened at one time which should be enough to catch all possible Longs or Shorts.
Solo Confirmation Simple (Confirmation, Backtest)
1. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Simple"
1. Import the GKD-C indicator into the GKD-BT Backtest: "Input into Backtest"
2. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Solo Confirmation Simple"
Solo Confirmation Complex without Exits (Baseline, Volatility/Volume, Confirmation, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Complex"
4. Import the GKD-V indicator into the GKD-C indicator: "Input into C1 or Backtest"
5. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full wo/ Exits"
6. Import the GKD-C into the GKD-BT Backtest: "Input into Exit or Backtest"
Solo Confirmation Complex with Exits (Baseline, Volatility/Volume, Confirmation, Exit, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Complex"
4. Import the GKD-V indicator into the GKD-C indicator: "Input into C1 or Backtest"
5. Import the GKD-C indicator into the GKD-E indicator: "Input into Exit"
6. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full w/ Exits"
7. Import the GKD-E into the GKD-BT Backtest: "Input into Backtest"
Full GKD without Exits (Baseline, Volatility/Volume, Confirmation 1, Confirmation 2, Continuation, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C 1 indicator, change the "Confirmation Type" setting to "Confirmation 1"
4. Import the GKD-V indicator into the GKD-C 1 indicator: "Input into C1 or Backtest"
5. Inside the GKD-C 2 indicator, change the "Confirmation Type" setting to "Confirmation 2"
6. Import the GKD-C 1 indicator into the GKD-C 2 indicator: "Input into C2"
7. Inside the GKD-C Continuation indicator, change the "Confirmation Type" setting to "Continuation"
8. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full wo/ Exits"
9. Import the GKD-E into the GKD-BT Backtest: "Input into Exit or Backtest"
Full GKD with Exits (Baseline, Volatility/Volume, Confirmation 1, Confirmation 2, Continuation, Exit, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C 1 indicator, change the "Confirmation Type" setting to "Confirmation 1"
4. Import the GKD-V indicator into the GKD-C 1 indicator: "Input into C1 or Backtest"
5. Inside the GKD-C 2 indicator, change the "Confirmation Type" setting to "Confirmation 2"
6. Import the GKD-C 1 indicator into the GKD-C 2 indicator: "Input into C2"
7. Inside the GKD-C Continuation indicator, change the "Confirmation Type" setting to "Continuation"
8. Import the GKD-C Continuation indicator into the GKD-E indicator: "Input into Exit"
9. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full w/ Exits"
10. Import the GKD-E into the GKD-BT Backtest: "Input into Backtest"
Baseline + Volatility/Volume (Baseline, Volatility/Volume, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Baseline + Volatility/Volume"
2. Inside the GKD-V indicator, make sure the "Signal Type" setting is set to "Traditional"
3. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
4. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Baseline + Volatility/Volume"
5. Import the GKD-V into the GKD-BT Backtest: "Input into C1 or Backtest"
6. Inside the GKD-BT Backtest, change the setting "Backtest Type" to "Full". For this backtest, you must test Longs and Shorts separately
7. To allow the system to open multiple orders at one time so you can test all Longs or Shorts, open the GKD-BT Backtest, click the tab "Properties" and then insert a value of something like 10 orders into the "Pyramiding" settings. This will allow 10 orders to be opened at one time which should be enough to catch all possible Longs or Shorts.
█ GKD-C RAVI Fisher Transform
What is the Fisher Transform?
The Fisher Transform is a technical analysis indicator developed by John Ehlers, an expert in the field of signal processing and technical analysis. The Fisher Transform is designed to convert price data into a Gaussian probability distribution, which makes it easier to identify market turning points and produce clearer trading signals.
The Fisher Transform is particularly useful in financial markets because price data often exhibit non-Gaussian characteristics, such as skewness and kurtosis. By converting the data into a Gaussian distribution, the Fisher Transform helps to highlight extreme price movements and generate more accurate trading signals.
To calculate the Fisher Transform, follow these steps:
1. Normalize the price data by computing the price relative to a moving average or another relevant indicator, ensuring the data falls within a range of -1 to 1.
2. Apply the Fisher Transform formula to the normalized price data:
Fisher Transform = 0.5 * ln
where ln represents the natural logarithm and X is the normalized price data.
3. Smooth the transformed data using a moving average or another smoothing technique to reduce noise and improve signal clarity.
The Fisher Transform indicator generates trading signals based on crossovers. A buy signal occurs when the Fisher Transform value crosses above a certain threshold, while a sell signal occurs when the Fisher Transform value crosses below a different threshold. These thresholds can be adjusted to match specific trading styles and market conditions. Traders often use the Fisher Transform in conjunction with other technical analysis tools to confirm signals and improve their trading strategies.
What is RAVI (Range Action Verification Index) ?
The RAVI (Range Action Verification Index) indicator is a technical analysis tool developed by Tushar Chande, a well-known expert in the field of technical analysis. The RAVI indicator is designed to help traders identify the market's current trend and distinguish between trending and range-bound market conditions.
The RAVI indicator measures the difference between two moving averages of different lengths and expresses the result as a percentage. It essentially quantifies the degree of price change over time, allowing traders to assess the strength of a trend or the lack thereof.
To calculate the RAVI indicator, follow these steps:
1. Choose two different lengths for the moving averages, a short period (e.g., 7 periods) and a long period (e.g., 65 periods).
2. Calculate the Simple Moving Average (SMA) for both short and long periods.
3. Subtract the long period SMA from the short period SMA.
4. Divide the result by the long period SMA.
5. Multiply the result by 100 to express the value as a percentage.
The RAVI indicator generates trading signals based on the crossing of predefined thresholds. A common approach is to use two threshold levels, such as 3% and -3%. When the RAVI value crosses above the upper threshold (3%), it indicates the start of an uptrend, and traders may consider entering a long position. Conversely, when the RAVI value crosses below the lower threshold (-3%), it suggests the start of a downtrend, and traders may consider entering a short position.
In range-bound or sideways market conditions, the RAVI values typically stay within the threshold levels, providing no clear trading signals. In such cases, traders may opt to use other range trading strategies or indicators.
It's important to note that the RAVI indicator, like any other technical analysis tool, should be used in conjunction with other indicators and analysis techniques to confirm signals and improve overall trading strategies.
What is the RAVI Fisher Transform?
This indicator runs a specialized Fisher Transform through a RAVI algorihtm to reduce false signals.
Requirements
Inputs
Confirmation 1: GKD-V Volatility / Volume indicator
Confirmation 2: GKD-C Confirmation indicator
Continuation: GKD-C Confirmation indicator
Solo Confirmation Simple: GKD-B Baseline
Solo Confirmation Complex: GKD-V Volatility / Volume indicator
Solo Confirmation Super Complex: GKD-V Volatility / Volume indicator
Stacked 1: None
Stacked 2+: GKD-C, GKD-V, or GKD-B Stacked 1
Outputs
Confirmation 1: GKD-C Confirmation 2 indicator
Confirmation 2: GKD-C Continuation indicator
Continuation: GKD-E Exit indicator
Solo Confirmation Simple: GKD-BT Backtest
Solo Confirmation Complex: GKD-BT Backtest or GKD-E Exit indicator
Solo Confirmation Super Complex: GKD-C Continuation indicator
Stacked 1: GKD-C, GKD-V, or GKD-B Stacked 2+
Stacked 2+: GKD-C, GKD-V, or GKD-B Stacked 2+ or GKD-BT Backtest
Additional features will be added in future releases.
GKD-C Non-Lag Inverse Fisher Transform of RSX [Loxx]Giga Kaleidoscope GKD-C Non-Lag Inverse Fisher Transform of RSX is a Confirmation module included in Loxx's "Giga Kaleidoscope Modularized Trading System".
█ Giga Kaleidoscope Modularized Trading System
What is Loxx's "Giga Kaleidoscope Modularized Trading System"?
The Giga Kaleidoscope Modularized Trading System is a trading system built on the philosophy of the NNFX (No Nonsense Forex) algorithmic trading.
What is the NNFX algorithmic trading strategy?
The NNFX (No-Nonsense Forex) trading system is a comprehensive approach to Forex trading that is designed to simplify the process and remove the confusion and complexity that often surrounds trading. The system was developed by a Forex trader who goes by the pseudonym "VP" and has gained a significant following in the Forex community.
The NNFX trading system is based on a set of rules and guidelines that help traders make objective and informed decisions. These rules cover all aspects of trading, including market analysis, trade entry, stop loss placement, and trade management.
Here are the main components of the NNFX trading system:
1. Trading Philosophy: The NNFX trading system is based on the idea that successful trading requires a comprehensive understanding of the market, objective analysis, and strict risk management. The system aims to remove subjective elements from trading and focuses on objective rules and guidelines.
2. Technical Analysis: The NNFX trading system relies heavily on technical analysis and uses a range of indicators to identify high-probability trading opportunities. The system uses a combination of trend-following and mean-reverting strategies to identify trades.
3. Market Structure: The NNFX trading system emphasizes the importance of understanding the market structure, including price action, support and resistance levels, and market cycles. The system uses a range of tools to identify the market structure, including trend lines, channels, and moving averages.
4. Trade Entry: The NNFX trading system has strict rules for trade entry. The system uses a combination of technical indicators to identify high-probability trades, and traders must meet specific criteria to enter a trade.
5. Stop Loss Placement: The NNFX trading system places a significant emphasis on risk management and requires traders to place a stop loss order on every trade. The system uses a combination of technical analysis and market structure to determine the appropriate stop loss level.
6. Trade Management: The NNFX trading system has specific rules for managing open trades. The system aims to minimize risk and maximize profit by using a combination of trailing stops, take profit levels, and position sizing.
Overall, the NNFX trading system is designed to be a straightforward and easy-to-follow approach to Forex trading that can be applied by traders of all skill levels.
Core components of an NNFX algorithmic trading strategy
The NNFX algorithm is built on the principles of trend, momentum, and volatility. There are six core components in the NNFX trading algorithm:
1. Volatility - price volatility; e.g., Average True Range, True Range Double, Close-to-Close, etc.
2. Baseline - a moving average to identify price trend
3. Confirmation 1 - a technical indicator used to identify trends
4. Confirmation 2 - a technical indicator used to identify trends
5. Continuation - a technical indicator used to identify trends
6. Volatility/Volume - a technical indicator used to identify volatility/volume breakouts/breakdown
7. Exit - a technical indicator used to determine when a trend is exhausted
What is Volatility in the NNFX trading system?
In the NNFX (No Nonsense Forex) trading system, ATR (Average True Range) is typically used to measure the volatility of an asset. It is used as a part of the system to help determine the appropriate stop loss and take profit levels for a trade. ATR is calculated by taking the average of the true range values over a specified period.
True range is calculated as the maximum of the following values:
-Current high minus the current low
-Absolute value of the current high minus the previous close
-Absolute value of the current low minus the previous close
ATR is a dynamic indicator that changes with changes in volatility. As volatility increases, the value of ATR increases, and as volatility decreases, the value of ATR decreases. By using ATR in NNFX system, traders can adjust their stop loss and take profit levels according to the volatility of the asset being traded. This helps to ensure that the trade is given enough room to move, while also minimizing potential losses.
Other types of volatility include True Range Double (TRD), Close-to-Close, and Garman-Klass
What is a Baseline indicator?
The baseline is essentially a moving average, and is used to determine the overall direction of the market.
The baseline in the NNFX system is used to filter out trades that are not in line with the long-term trend of the market. The baseline is plotted on the chart along with other indicators, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR).
Trades are only taken when the price is in the same direction as the baseline. For example, if the baseline is sloping upwards, only long trades are taken, and if the baseline is sloping downwards, only short trades are taken. This approach helps to ensure that trades are in line with the overall trend of the market, and reduces the risk of entering trades that are likely to fail.
By using a baseline in the NNFX system, traders can have a clear reference point for determining the overall trend of the market, and can make more informed trading decisions. The baseline helps to filter out noise and false signals, and ensures that trades are taken in the direction of the long-term trend.
What is a Confirmation indicator?
Confirmation indicators are technical indicators that are used to confirm the signals generated by primary indicators. Primary indicators are the core indicators used in the NNFX system, such as the Average True Range (ATR), the Moving Average (MA), and the Relative Strength Index (RSI).
The purpose of the confirmation indicators is to reduce false signals and improve the accuracy of the trading system. They are designed to confirm the signals generated by the primary indicators by providing additional information about the strength and direction of the trend.
Some examples of confirmation indicators that may be used in the NNFX system include the Bollinger Bands, the MACD (Moving Average Convergence Divergence), and the MACD Oscillator. These indicators can provide information about the volatility, momentum, and trend strength of the market, and can be used to confirm the signals generated by the primary indicators.
In the NNFX system, confirmation indicators are used in combination with primary indicators and other filters to create a trading system that is robust and reliable. By using multiple indicators to confirm trading signals, the system aims to reduce the risk of false signals and improve the overall profitability of the trades.
What is a Continuation indicator?
In the NNFX (No Nonsense Forex) trading system, a continuation indicator is a technical indicator that is used to confirm a current trend and predict that the trend is likely to continue in the same direction. A continuation indicator is typically used in conjunction with other indicators in the system, such as a baseline indicator, to provide a comprehensive trading strategy.
What is a Volatility/Volume indicator?
Volume indicators, such as the On Balance Volume (OBV), the Chaikin Money Flow (CMF), or the Volume Price Trend (VPT), are used to measure the amount of buying and selling activity in a market. They are based on the trading volume of the market, and can provide information about the strength of the trend. In the NNFX system, volume indicators are used to confirm trading signals generated by the Moving Average and the Relative Strength Index. Volatility indicators include Average Direction Index, Waddah Attar, and Volatility Ratio. In the NNFX trading system, volatility is a proxy for volume and vice versa.
By using volume indicators as confirmation tools, the NNFX trading system aims to reduce the risk of false signals and improve the overall profitability of trades. These indicators can provide additional information about the market that is not captured by the primary indicators, and can help traders to make more informed trading decisions. In addition, volume indicators can be used to identify potential changes in market trends and to confirm the strength of price movements.
What is an Exit indicator?
The exit indicator is used in conjunction with other indicators in the system, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR), to provide a comprehensive trading strategy.
The exit indicator in the NNFX system can be any technical indicator that is deemed effective at identifying optimal exit points. Examples of exit indicators that are commonly used include the Parabolic SAR, the Average Directional Index (ADX), and the Chandelier Exit.
The purpose of the exit indicator is to identify when a trend is likely to reverse or when the market conditions have changed, signaling the need to exit a trade. By using an exit indicator, traders can manage their risk and prevent significant losses.
In the NNFX system, the exit indicator is used in conjunction with a stop loss and a take profit order to maximize profits and minimize losses. The stop loss order is used to limit the amount of loss that can be incurred if the trade goes against the trader, while the take profit order is used to lock in profits when the trade is moving in the trader's favor.
Overall, the use of an exit indicator in the NNFX trading system is an important component of a comprehensive trading strategy. It allows traders to manage their risk effectively and improve the profitability of their trades by exiting at the right time.
How does Loxx's GKD (Giga Kaleidoscope Modularized Trading System) implement the NNFX algorithm outlined above?
Loxx's GKD v1.0 system has five types of modules (indicators/strategies). These modules are:
1. GKD-BT - Backtesting module (Volatility, Number 1 in the NNFX algorithm)
2. GKD-B - Baseline module (Baseline and Volatility/Volume, Numbers 1 and 2 in the NNFX algorithm)
3. GKD-C - Confirmation 1/2 and Continuation module (Confirmation 1/2 and Continuation, Numbers 3, 4, and 5 in the NNFX algorithm)
4. GKD-V - Volatility/Volume module (Confirmation 1/2, Number 6 in the NNFX algorithm)
5. GKD-E - Exit module (Exit, Number 7 in the NNFX algorithm)
(additional module types will added in future releases)
Each module interacts with every module by passing data between modules. Data is passed between each module as described below:
GKD-B => GKD-V => GKD-C(1) => GKD-C(2) => GKD-C(Continuation) => GKD-E => GKD-BT
That is, the Baseline indicator passes its data to Volatility/Volume. The Volatility/Volume indicator passes its values to the Confirmation 1 indicator. The Confirmation 1 indicator passes its values to the Confirmation 2 indicator. The Confirmation 2 indicator passes its values to the Continuation indicator. The Continuation indicator passes its values to the Exit indicator, and finally, the Exit indicator passes its values to the Backtest strategy.
This chaining of indicators requires that each module conform to Loxx's GKD protocol, therefore allowing for the testing of every possible combination of technical indicators that make up the six components of the NNFX algorithm.
What does the application of the GKD trading system look like?
Example trading system:
Backtest: Strategy with 1-3 take profits, trailing stop loss, multiple types of PnL volatility, and 2 backtesting styles
Baseline: Hull Moving Average
Volatility/Volume: Hurst Exponent
Confirmation 1: Non-Lag Inverse Fisher Transform of RSX as shown on the chart above
Confirmation 2: Williams Percent Range
Continuation: Fisher Transform
Exit: Rex Oscillator
Each GKD indicator is denoted with a module identifier of either: GKD-BT, GKD-B, GKD-C, GKD-V, or GKD-E. This allows traders to understand to which module each indicator belongs and where each indicator fits into the GKD protocol chain.
Giga Kaleidoscope Modularized Trading System Signals (based on the NNFX algorithm)
Standard Entry
1. GKD-C Confirmation 1 Signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
6. GKD-C Confirmation 1 signal was less than 7 candles prior
Volatility/Volume Entry
1. GKD-V Volatility/Volume signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-B Baseline agrees
6. GKD-C Confirmation 1 signal was less than 7 candles prior
Continuation Entry
1. Standard Entry, Baseline Entry, or Pullback; entry triggered previously
2. GKD-B Baseline hasn't crossed since entry signal trigger
3. GKD-C Confirmation Continuation Indicator signals
4. GKD-C Confirmation 1 agrees
5. GKD-B Baseline agrees
6. GKD-C Confirmation 2 agrees
1-Candle Rule Standard Entry
1. GKD-C Confirmation 1 signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
1-Candle Rule Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 1 signal was less than 7 candles prior
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume Agrees
1-Candle Rule Volatility/Volume Entry
1. GKD-V Volatility/Volume signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 1 signal was less than 7 candles prior
Next Candle:
1. Price retraced (Long: close < close or Short: close > close)
2. GKD-B Volatility/Volume agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-B Baseline agrees
PullBack Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is beyond 1.0x Volatility of Baseline
Next Candle:
1. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
2. GKD-C Confirmation 1 agrees
3. GKD-C Confirmation 2 agrees
4. GKD-V Volatility/Volume Agrees
]█ Setting up the GKD
The GKD system involves chaining indicators together. These are the steps to set this up.
Use a GKD-C indicator alone on a chart
1. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Simple"
Use a GKD-V indicator alone on a chart
**nothing, it's already useable on the chart without any settings changes
Use a GKD-B indicator alone on a chart
**nothing, it's already useable on the chart without any settings changes
Baseline (Baseline, Backtest)
1. Import the GKD-B Baseline into the GKD-BT Backtest: "Input into Volatility/Volume or Backtest (Baseline testing)"
2. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Baseline"
Volatility/Volume (Volatility/Volume, Backte st)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Solo"
2. Inside the GKD-V indicator, change the "Signal Type" setting to "Crossing" (neither traditional nor both can be backtested)
3. Import the GKD-V indicator into the GKD-BT Backtest: "Input into C1 or Backtest"
4. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Volatility/Volume"
5. Inside the GKD-BT Backtest, a) change the setting "Backtest Type" to "Trading" if using a directional GKD-V indicator; or, b) change the setting "Backtest Type" to "Full" if using a directional or non-directional GKD-V indicator (non-directional GKD-V can only test Longs and Shorts separately)
6. If "Backtest Type" is set to "Full": Inside the GKD-BT Backtest, change the setting "Backtest Side" to "Long" or "Short
7. If "Backtest Type" is set to "Full": To allow the system to open multiple orders at one time so you test all Longs or Shorts, open the GKD-BT Backtest, click the tab "Properties" and then insert a value of something like 10 orders into the "Pyramiding" settings. This will allow 10 orders to be opened at one time which should be enough to catch all possible Longs or Shorts.
Solo Confirmation Simple (Confirmation, Backtest)
1. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Simple"
1. Import the GKD-C indicator into the GKD-BT Backtest: "Input into Backtest"
2. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Solo Confirmation Simple"
Solo Confirmation Complex without Exits (Baseline, Volatility/Volume, Confirmation, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Complex"
4. Import the GKD-V indicator into the GKD-C indicator: "Input into C1 or Backtest"
5. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full wo/ Exits"
6. Import the GKD-C into the GKD-BT Backtest: "Input into Exit or Backtest"
Solo Confirmation Complex with Exits (Baseline, Volatility/Volume, Confirmation, Exit, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Complex"
4. Import the GKD-V indicator into the GKD-C indicator: "Input into C1 or Backtest"
5. Import the GKD-C indicator into the GKD-E indicator: "Input into Exit"
6. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full w/ Exits"
7. Import the GKD-E into the GKD-BT Backtest: "Input into Backtest"
Full GKD without Exits (Baseline, Volatility/Volume, Confirmation 1, Confirmation 2, Continuation, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C 1 indicator, change the "Confirmation Type" setting to "Confirmation 1"
4. Import the GKD-V indicator into the GKD-C 1 indicator: "Input into C1 or Backtest"
5. Inside the GKD-C 2 indicator, change the "Confirmation Type" setting to "Confirmation 2"
6. Import the GKD-C 1 indicator into the GKD-C 2 indicator: "Input into C2"
7. Inside the GKD-C Continuation indicator, change the "Confirmation Type" setting to "Continuation"
8. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full wo/ Exits"
9. Import the GKD-E into the GKD-BT Backtest: "Input into Exit or Backtest"
Full GKD with Exits (Baseline, Volatility/Volume, Confirmation 1, Confirmation 2, Continuation, Exit, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C 1 indicator, change the "Confirmation Type" setting to "Confirmation 1"
4. Import the GKD-V indicator into the GKD-C 1 indicator: "Input into C1 or Backtest"
5. Inside the GKD-C 2 indicator, change the "Confirmation Type" setting to "Confirmation 2"
6. Import the GKD-C 1 indicator into the GKD-C 2 indicator: "Input into C2"
7. Inside the GKD-C Continuation indicator, change the "Confirmation Type" setting to "Continuation"
8. Import the GKD-C Continuation indicator into the GKD-E indicator: "Input into Exit"
9. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full w/ Exits"
10. Import the GKD-E into the GKD-BT Backtest: "Input into Backtest"
Baseline + Volatility/Volume (Baseline, Volatility/Volume, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Baseline + Volatility/Volume"
2. Inside the GKD-V indicator, make sure the "Signal Type" setting is set to "Traditional"
3. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
4. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Baseline + Volatility/Volume"
5. Import the GKD-V into the GKD-BT Backtest: "Input into C1 or Backtest"
6. Inside the GKD-BT Backtest, change the setting "Backtest Type" to "Full". For this backtest, you must test Longs and Shorts separately
7. To allow the system to open multiple orders at one time so you can test all Longs or Shorts, open the GKD-BT Backtest, click the tab "Properties" and then insert a value of something like 10 orders into the "Pyramiding" settings. This will allow 10 orders to be opened at one time which should be enough to catch all possible Longs or Shorts.
█ GKD-C Non-Lag Inverse Fisher Transform of RSX
What is the Inverse Fisher Transform?
The Inverse Fisher Transform (IFT) is a technical analysis indicator developed by John Ehlers, an expert in the field of signal processing and technical analysis. The IFT is designed to convert price data into a Gaussian probability distribution, which makes it easier to identify market turning points and produce clearer trading signals.
The Inverse Fisher Transform is based on the Fisher Transform, which is a mathematical technique used to convert non-Gaussian distributions into Gaussian distributions. The Fisher Transform is particularly useful in financial markets because price data often exhibit non-Gaussian characteristics, such as skewness and kurtosis.
To calculate the Inverse Fisher Transform, follow these steps:
1. Normalize the price data by computing the price relative to a moving average or another relevant indicator, ensuring the data falls within a range of -1 to 1.
2. Apply the Fisher Transform formula to the normalized price data:
Fisher Transform = 0.5 * ln
where ln represents the natural logarithm and X is the normalized price data.
3. Smooth the transformed data using a moving average or another smoothing technique to reduce noise and improve signal clarity.
4. Apply the Inverse Fisher Transform formula to the smoothed Fisher Transform data:
Inverse Fisher Transform = (exp(2 * Y) - 1) / (exp(2 * Y) + 1)
where Y represents the smoothed Fisher Transform data and exp is the exponential function.
The Inverse Fisher Transform indicator generates trading signals based on crossovers. A buy signal occurs when the IFT crosses above a certain threshold, while a sell signal occurs when the IFT crosses below a different threshold. These thresholds can be adjusted to match specific trading styles and market conditions. Traders often use the IFT in conjunction with other technical analysis tools to confirm signals and improve their trading strategies.
What is RSX?
The Jurik RSX ( Relative Strength Index ) is a technical indicator used in financial markets to measure the strength of price movement. It was developed by Mark Jurik and is based on the RSI formula, with the addition of smoothing and other modifications.
The Jurik RSX is designed to be smoother and more responsive than traditional RSI indicators, making it more useful for detecting trends and trading signals. It is also less prone to false signals and noise, which can be a problem with some other technical indicators.
The Jurik RSX can be used in a variety of ways, including as a trend-following indicator or a momentum indicator . It can also be combined with other indicators and trading strategies to improve overall performance.
What is the Non-Lag Moving Average?
The Non-Linear Generalized Moving Average (non-LAGMA) is a type of moving average that aims to provide a smoother and more accurate representation of the underlying data trend than a traditional moving average. It does this by applying weighted coefficients to the data based on its position in the cycle, which helps to reduce the impact of noise and outliers.
Unlike a simple moving average (SMA) or an exponential moving average (EMA), the non-LAGMA takes a more adaptive approach to calculating the average by assigning different weights to the data points in the input window. This weighting system helps to emphasize more recent data points and reduce the lag often associated with traditional moving averages, making it more responsive to changing market conditions.
The non-LAGMA can be used as a trend-following indicator or as a signal generator for trading strategies, similar to other moving averages. Traders may use non-LAGMA in conjunction with other technical analysis tools to confirm signals and improve their trading strategies. It is particularly useful in markets with high levels of noise or when attempting to identify trends in the early stages of their formation.
What is the Non-Lag Inverse Fisher Transform of RSX?
This indicator smooths RSX with a Non-Lag Filter and then injects this output into an Inverse Fisher Transform calculation. This indicator has three types of signals: middle, signal, and levels cross.
Requirements
Inputs
Confirmation 1: GKD-V Volatility / Volume indicator
Confirmation 2: GKD-C Confirmation indicator
Continuation: GKD-C Confirmation indicator
Solo Confirmation Simple: GKD-B Baseline
Solo Confirmation Complex: GKD-V Volatility / Volume indicator
Solo Confirmation Super Complex: GKD-V Volatility / Volume indicator
Stacked 1: None
Stacked 2+: GKD-C, GKD-V, or GKD-B Stacked 1
Outputs
Confirmation 1: GKD-C Confirmation 2 indicator
Confirmation 2: GKD-C Continuation indicator
Continuation: GKD-E Exit indicator
Solo Confirmation Simple: GKD-BT Backtest
Solo Confirmation Complex: GKD-BT Backtest or GKD-E Exit indicator
Solo Confirmation Super Complex: GKD-C Continuation indicator
Stacked 1: GKD-C, GKD-V, or GKD-B Stacked 2+
Stacked 2+: GKD-C, GKD-V, or GKD-B Stacked 2+ or GKD-BT Backtest
Additional features will be added in future releases.
Trend Lines + Figure Detect (cross) SL + TP + RSI + PosicionDescription:
This indicator works with 2 main set ups.
1.-Price Action: 2 Trending lines : 1 superior with relevant high at 120 periods and 1 inferior with releveant lows of 120 perios.
2.-(hiden) 2 RSI Trending lines (based on 14 period and close) : 1 superior trend line with relevant high at 120 periods and 1 inferior trend line with releveant lows of 120 perios.
This indicador works as follows:
1.- Indicator detect chart form with trend lines and based on the last bar to 120 candles before.
Chart detected:
1.- Wedges = Cuña
2.- Chanels = Canal
2.- Indicador calculate trend lines superior and inferior of RSI with 120 candels previus.
2.- The indicator activate alerts once these conditions presented at the same time:
a) Price breake above trend line superior or breake under line inferior.
b) RSI brease above trend line superior or inferior.
How to use:
1.- Add indicator
2.- Indicator will show
*Buy / Sell Alerts.
3.- Stop Loss (Red Line) and Take Profit (Green Line) will be calculated automatically based on trading system theory with wedges and chanels.
4.- In Buy postion take Profit will be recalculated once new lows above the stop loss are presented.
In Sell postion take Profit will be recalculated once new lows above the stop loss are presented.
5.- Once price achiece take porfit level it will trigert an alert.
6.- Trade will be closed when Price cross the Stop Loss or Take Profit Dinamic.
Originality:
This is based on what I would like to know before start trading and loos a lot of money buying or selling with out any strategy regarding risk management, trade management, set up entry and close levels.
Risk Management:
Paramenters:
Risk = 1%
Capital = Variable Account Capital.
These 2 variables that the user can change, the indicator will sugget the lot size on that trade to avoid loose more that 1% of the capital in case the trade close with losss.
Moonhub Cycle IndexMoonhub Cycle Index is a composite index derived from three popular technical analysis indicators: Moving Average Convergence Divergence (MACD), Schaff Trend Cycle (STC), and Detrended Price Oscillator (DPO). The indicator is designed to help identify potential trends and market sentiment by combining the unique characteristics of each indicator.
Key components of the indicator include:
Input Parameters:
COEMA Length (len_DIema): The length of the Exponential Moving Average (EMA) applied to the Custom Index. Default is set to 9.
COSMA Length (len_DIsma): The length of the Simple Moving Average (SMA) applied to the Custom Index. Default is set to 30.
Indicators:
MACD: A momentum oscillator that shows the relationship between two moving averages of a security's price. It is calculated using the difference between the 12-period and 26-period EMA, and a 9-period EMA (signal line) of the MACD.
STC: A cyclic indicator that identifies cyclical trends in the market. It is calculated using the Stochastic oscillator formula applied to the close, high, and low prices over a 10-period lookback window.
DPO: A price oscillator that eliminates the trend from price data to focus on underlying cycles. It is calculated using a custom function that shifts the price by half the length and subtracts the SMA from the shifted price.
Custom Index: The composite index is calculated by taking the average of the MACD line, STC, and DPO.
COEMA and COSMA: Exponential and Simple Moving Averages applied to the Custom Index using the lengths specified by the input parameters (len_DIema and len_DIsma).
Plots: The Custom Index, COEMA, and COSMA are plotted with different colors and line widths to visualize their interaction and provide insights into potential market trends.
This Custom Index Indicator can be useful for traders who want to analyze the market using a combination of these indicators to make more informed decisions. It can also help identify potential trends and market sentiment by combining the unique characteristics of each indicator.
GKD-C Nyquist Moving Average (NMA) MACD [Loxx]Giga Kaleidoscope GKD-C Nyquist Moving Average (NMA) MACD is a Confirmation module included in Loxx's "Giga Kaleidoscope Modularized Trading System".
█ Giga Kaleidoscope Modularized Trading System
What is Loxx's "Giga Kaleidoscope Modularized Trading System"?
The Giga Kaleidoscope Modularized Trading System is a trading system built on the philosophy of the NNFX (No Nonsense Forex) algorithmic trading.
What is the NNFX algorithmic trading strategy?
The NNFX (No-Nonsense Forex) trading system is a comprehensive approach to Forex trading that is designed to simplify the process and remove the confusion and complexity that often surrounds trading. The system was developed by a Forex trader who goes by the pseudonym "VP" and has gained a significant following in the Forex community.
The NNFX trading system is based on a set of rules and guidelines that help traders make objective and informed decisions. These rules cover all aspects of trading, including market analysis, trade entry, stop loss placement, and trade management.
Here are the main components of the NNFX trading system:
1. Trading Philosophy: The NNFX trading system is based on the idea that successful trading requires a comprehensive understanding of the market, objective analysis, and strict risk management. The system aims to remove subjective elements from trading and focuses on objective rules and guidelines.
2. Technical Analysis: The NNFX trading system relies heavily on technical analysis and uses a range of indicators to identify high-probability trading opportunities. The system uses a combination of trend-following and mean-reverting strategies to identify trades.
3. Market Structure: The NNFX trading system emphasizes the importance of understanding the market structure, including price action, support and resistance levels, and market cycles. The system uses a range of tools to identify the market structure, including trend lines, channels, and moving averages.
4. Trade Entry: The NNFX trading system has strict rules for trade entry. The system uses a combination of technical indicators to identify high-probability trades, and traders must meet specific criteria to enter a trade.
5. Stop Loss Placement: The NNFX trading system places a significant emphasis on risk management and requires traders to place a stop loss order on every trade. The system uses a combination of technical analysis and market structure to determine the appropriate stop loss level.
6. Trade Management: The NNFX trading system has specific rules for managing open trades. The system aims to minimize risk and maximize profit by using a combination of trailing stops, take profit levels, and position sizing.
Overall, the NNFX trading system is designed to be a straightforward and easy-to-follow approach to Forex trading that can be applied by traders of all skill levels.
Core components of an NNFX algorithmic trading strategy
The NNFX algorithm is built on the principles of trend, momentum, and volatility. There are six core components in the NNFX trading algorithm:
1. Volatility - price volatility; e.g., Average True Range, True Range Double, Close-to-Close, etc.
2. Baseline - a moving average to identify price trend
3. Confirmation 1 - a technical indicator used to identify trends
4. Confirmation 2 - a technical indicator used to identify trends
5. Continuation - a technical indicator used to identify trends
6. Volatility/Volume - a technical indicator used to identify volatility/volume breakouts/breakdown
7. Exit - a technical indicator used to determine when a trend is exhausted
What is Volatility in the NNFX trading system?
In the NNFX (No Nonsense Forex) trading system, ATR (Average True Range) is typically used to measure the volatility of an asset. It is used as a part of the system to help determine the appropriate stop loss and take profit levels for a trade. ATR is calculated by taking the average of the true range values over a specified period.
True range is calculated as the maximum of the following values:
-Current high minus the current low
-Absolute value of the current high minus the previous close
-Absolute value of the current low minus the previous close
ATR is a dynamic indicator that changes with changes in volatility. As volatility increases, the value of ATR increases, and as volatility decreases, the value of ATR decreases. By using ATR in NNFX system, traders can adjust their stop loss and take profit levels according to the volatility of the asset being traded. This helps to ensure that the trade is given enough room to move, while also minimizing potential losses.
Other types of volatility include True Range Double (TRD), Close-to-Close, and Garman-Klass
What is a Baseline indicator?
The baseline is essentially a moving average, and is used to determine the overall direction of the market.
The baseline in the NNFX system is used to filter out trades that are not in line with the long-term trend of the market. The baseline is plotted on the chart along with other indicators, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR).
Trades are only taken when the price is in the same direction as the baseline. For example, if the baseline is sloping upwards, only long trades are taken, and if the baseline is sloping downwards, only short trades are taken. This approach helps to ensure that trades are in line with the overall trend of the market, and reduces the risk of entering trades that are likely to fail.
By using a baseline in the NNFX system, traders can have a clear reference point for determining the overall trend of the market, and can make more informed trading decisions. The baseline helps to filter out noise and false signals, and ensures that trades are taken in the direction of the long-term trend.
What is a Confirmation indicator?
Confirmation indicators are technical indicators that are used to confirm the signals generated by primary indicators. Primary indicators are the core indicators used in the NNFX system, such as the Average True Range (ATR), the Moving Average (MA), and the Relative Strength Index (RSI).
The purpose of the confirmation indicators is to reduce false signals and improve the accuracy of the trading system. They are designed to confirm the signals generated by the primary indicators by providing additional information about the strength and direction of the trend.
Some examples of confirmation indicators that may be used in the NNFX system include the Bollinger Bands, the MACD (Moving Average Convergence Divergence), and the MACD Oscillator. These indicators can provide information about the volatility, momentum, and trend strength of the market, and can be used to confirm the signals generated by the primary indicators.
In the NNFX system, confirmation indicators are used in combination with primary indicators and other filters to create a trading system that is robust and reliable. By using multiple indicators to confirm trading signals, the system aims to reduce the risk of false signals and improve the overall profitability of the trades.
What is a Continuation indicator?
In the NNFX (No Nonsense Forex) trading system, a continuation indicator is a technical indicator that is used to confirm a current trend and predict that the trend is likely to continue in the same direction. A continuation indicator is typically used in conjunction with other indicators in the system, such as a baseline indicator, to provide a comprehensive trading strategy.
What is a Volatility/Volume indicator?
Volume indicators, such as the On Balance Volume (OBV), the Chaikin Money Flow (CMF), or the Volume Price Trend (VPT), are used to measure the amount of buying and selling activity in a market. They are based on the trading volume of the market, and can provide information about the strength of the trend. In the NNFX system, volume indicators are used to confirm trading signals generated by the Moving Average and the Relative Strength Index. Volatility indicators include Average Direction Index, Waddah Attar, and Volatility Ratio. In the NNFX trading system, volatility is a proxy for volume and vice versa.
By using volume indicators as confirmation tools, the NNFX trading system aims to reduce the risk of false signals and improve the overall profitability of trades. These indicators can provide additional information about the market that is not captured by the primary indicators, and can help traders to make more informed trading decisions. In addition, volume indicators can be used to identify potential changes in market trends and to confirm the strength of price movements.
What is an Exit indicator?
The exit indicator is used in conjunction with other indicators in the system, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR), to provide a comprehensive trading strategy.
The exit indicator in the NNFX system can be any technical indicator that is deemed effective at identifying optimal exit points. Examples of exit indicators that are commonly used include the Parabolic SAR, the Average Directional Index (ADX), and the Chandelier Exit.
The purpose of the exit indicator is to identify when a trend is likely to reverse or when the market conditions have changed, signaling the need to exit a trade. By using an exit indicator, traders can manage their risk and prevent significant losses.
In the NNFX system, the exit indicator is used in conjunction with a stop loss and a take profit order to maximize profits and minimize losses. The stop loss order is used to limit the amount of loss that can be incurred if the trade goes against the trader, while the take profit order is used to lock in profits when the trade is moving in the trader's favor.
Overall, the use of an exit indicator in the NNFX trading system is an important component of a comprehensive trading strategy. It allows traders to manage their risk effectively and improve the profitability of their trades by exiting at the right time.
How does Loxx's GKD (Giga Kaleidoscope Modularized Trading System) implement the NNFX algorithm outlined above?
Loxx's GKD v1.0 system has five types of modules (indicators/strategies). These modules are:
1. GKD-BT - Backtesting module (Volatility, Number 1 in the NNFX algorithm)
2. GKD-B - Baseline module (Baseline and Volatility/Volume, Numbers 1 and 2 in the NNFX algorithm)
3. GKD-C - Confirmation 1/2 and Continuation module (Confirmation 1/2 and Continuation, Numbers 3, 4, and 5 in the NNFX algorithm)
4. GKD-V - Volatility/Volume module (Confirmation 1/2, Number 6 in the NNFX algorithm)
5. GKD-E - Exit module (Exit, Number 7 in the NNFX algorithm)
(additional module types will added in future releases)
Each module interacts with every module by passing data between modules. Data is passed between each module as described below:
GKD-B => GKD-V => GKD-C(1) => GKD-C(2) => GKD-C(Continuation) => GKD-E => GKD-BT
That is, the Baseline indicator passes its data to Volatility/Volume. The Volatility/Volume indicator passes its values to the Confirmation 1 indicator. The Confirmation 1 indicator passes its values to the Confirmation 2 indicator. The Confirmation 2 indicator passes its values to the Continuation indicator. The Continuation indicator passes its values to the Exit indicator, and finally, the Exit indicator passes its values to the Backtest strategy.
This chaining of indicators requires that each module conform to Loxx's GKD protocol, therefore allowing for the testing of every possible combination of technical indicators that make up the six components of the NNFX algorithm.
What does the application of the GKD trading system look like?
Example trading system:
Backtest: Strategy with 1-3 take profits, trailing stop loss, multiple types of PnL volatility, and 2 backtesting styles
Baseline: Hull Moving Average
Volatility/Volume: Hurst Exponent
Confirmation 1: Nyquist Moving Average (NMA) MACD as shown on the chart above
Confirmation 2: Williams Percent Range
Continuation: Fisher Transform
Exit: Rex Oscillator
Each GKD indicator is denoted with a module identifier of either: GKD-BT, GKD-B, GKD-C, GKD-V, or GKD-E. This allows traders to understand to which module each indicator belongs and where each indicator fits into the GKD protocol chain.
Giga Kaleidoscope Modularized Trading System Signals (based on the NNFX algorithm)
Standard Entry
1. GKD-C Confirmation 1 Signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
6. GKD-C Confirmation 1 signal was less than 7 candles prior
Volatility/Volume Entry
1. GKD-V Volatility/Volume signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-B Baseline agrees
6. GKD-C Confirmation 1 signal was less than 7 candles prior
Continuation Entry
1. Standard Entry, Baseline Entry, or Pullback; entry triggered previously
2. GKD-B Baseline hasn't crossed since entry signal trigger
3. GKD-C Confirmation Continuation Indicator signals
4. GKD-C Confirmation 1 agrees
5. GKD-B Baseline agrees
6. GKD-C Confirmation 2 agrees
1-Candle Rule Standard Entry
1. GKD-C Confirmation 1 signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
1-Candle Rule Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 1 signal was less than 7 candles prior
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume Agrees
1-Candle Rule Volatility/Volume Entry
1. GKD-V Volatility/Volume signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 1 signal was less than 7 candles prior
Next Candle:
1. Price retraced (Long: close < close or Short: close > close)
2. GKD-B Volatility/Volume agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-B Baseline agrees
PullBack Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is beyond 1.0x Volatility of Baseline
Next Candle:
1. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
2. GKD-C Confirmation 1 agrees
3. GKD-C Confirmation 2 agrees
4. GKD-V Volatility/Volume Agrees
]█ Setting up the GKD
The GKD system involves chaining indicators together. These are the steps to set this up.
Use a GKD-C indicator alone on a chart
1. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Simple"
Use a GKD-V indicator alone on a chart
**nothing, it's already useable on the chart without any settings changes
Use a GKD-B indicator alone on a chart
**nothing, it's already useable on the chart without any settings changes
Baseline (Baseline, Backtest)
1. Import the GKD-B Baseline into the GKD-BT Backtest: "Input into Volatility/Volume or Backtest (Baseline testing)"
2. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Baseline"
Volatility/Volume (Volatility/Volume, Backte st)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Solo"
2. Inside the GKD-V indicator, change the "Signal Type" setting to "Crossing" (neither traditional nor both can be backtested)
3. Import the GKD-V indicator into the GKD-BT Backtest: "Input into C1 or Backtest"
4. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Volatility/Volume"
5. Inside the GKD-BT Backtest, a) change the setting "Backtest Type" to "Trading" if using a directional GKD-V indicator; or, b) change the setting "Backtest Type" to "Full" if using a directional or non-directional GKD-V indicator (non-directional GKD-V can only test Longs and Shorts separately)
6. If "Backtest Type" is set to "Full": Inside the GKD-BT Backtest, change the setting "Backtest Side" to "Long" or "Short
7. If "Backtest Type" is set to "Full": To allow the system to open multiple orders at one time so you test all Longs or Shorts, open the GKD-BT Backtest, click the tab "Properties" and then insert a value of something like 10 orders into the "Pyramiding" settings. This will allow 10 orders to be opened at one time which should be enough to catch all possible Longs or Shorts.
Solo Confirmation Simple (Confirmation, Backtest)
1. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Simple"
1. Import the GKD-C indicator into the GKD-BT Backtest: "Input into Backtest"
2. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Solo Confirmation Simple"
Solo Confirmation Complex without Exits (Baseline, Volatility/Volume, Confirmation, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Complex"
4. Import the GKD-V indicator into the GKD-C indicator: "Input into C1 or Backtest"
5. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full wo/ Exits"
6. Import the GKD-C into the GKD-BT Backtest: "Input into Exit"
Solo Confirmation Complex with Exits (Baseline, Volatility/Volume, Confirmation, Exit, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Complex"
4. Import the GKD-V indicator into the GKD-C indicator: "Input into C1 or Backtest"
5. Import the GKD-C indicator into the GKD-E indicator: "Input into Exit"
6. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full w/ Exits"
7. Import the GKD-E into the GKD-BT Backtest: "Input into Backtest"
Full GKD without Exits (Baseline, Volatility/Volume, Confirmation 1, Confirmation 2, Continuation, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C 1 indicator, change the "Confirmation Type" setting to "Confirmation 1"
4. Import the GKD-V indicator into the GKD-C 1 indicator: "Input into C1 or Backtest"
5. Inside the GKD-C 2 indicator, change the "Confirmation Type" setting to "Confirmation 2"
6. Import the GKD-C 1 indicator into the GKD-C 2 indicator: "Input into C2"
7. Inside the GKD-C Continuation indicator, change the "Confirmation Type" setting to "Continuation"
8. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full wo/ Exits"
9. Import the GKD-E into the GKD-BT Backtest: "Input into Exit"
Full GKD with Exits (Baseline, Volatility/Volume, Confirmation 1, Confirmation 2, Continuation, Exit, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C 1 indicator, change the "Confirmation Type" setting to "Confirmation 1"
4. Import the GKD-V indicator into the GKD-C 1 indicator: "Input into C1 or Backtest"
5. Inside the GKD-C 2 indicator, change the "Confirmation Type" setting to "Confirmation 2"
6. Import the GKD-C 1 indicator into the GKD-C 2 indicator: "Input into C2"
7. Inside the GKD-C Continuation indicator, change the "Confirmation Type" setting to "Continuation"
8. Import the GKD-C Continuation indicator into the GKD-E indicator: "Input into Exit"
9. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full w/ Exits"
10. Import the GKD-E into the GKD-BT Backtest: "Input into Backtest"
Baseline + Volatility/Volume (Baseline, Volatility/Volume, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Baseline + Volatility/Volume"
2. Inside the GKD-V indicator, make sure the "Signal Type" setting is set to "Traditional"
3. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
4. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Baseline + Volatility/Volume"
5. Import the GKD-V into the GKD-BT Backtest: "Input into C1 or Backtest"
6. Inside the GKD-BT Backtest, change the setting "Backtest Type" to "Full". For this backtest, you must test Longs and Shorts separately
7. To allow the system to open multiple orders at one time so you can test all Longs or Shorts, open the GKD-BT Backtest, click the tab "Properties" and then insert a value of something like 10 orders into the "Pyramiding" settings. This will allow 10 orders to be opened at one time which should be enough to catch all possible Longs or Shorts.
█ GKD-C Nyquist Moving Average (NMA) MACD
What is the Nyquist Moving Average (NMA) MACD?
The Nyquist Moving Average (NMA) is a lesser-known type of moving average in the field of technical analysis. It is designed to reduce lag and improve the responsiveness of moving averages. The name "Nyquist" likely originates from the Nyquist-Shannon sampling theorem, which states that a continuous-time signal can be accurately reconstructed from its discrete samples if the sampling rate is at least twice the highest frequency component of the original signal. The NMA tries to apply this concept to moving averages by reducing the time lag and improving the signal's fidelity to the underlying price movement.
The Nyquist Moving Average is calculated using a primary period (nper) and a secondary period (smper). A lambda value is determined by the ratio of nper to smper, and if lambda is less than 2, it is adjusted to meet the Nyquist-Shannon sampling theorem's requirements. Then, an alpha value is calculated using lambda and nper. Two moving averages are calculated using the specified type (e.g., simple, exponential, etc.), source data, and the primary and secondary periods. The final NMA is obtained using the alpha value and the two moving averages.
While the NMA is not as popular or widely used as other types of moving averages, like the Simple Moving Average (SMA) or the Exponential Moving Average (EMA), it can still be a valuable tool for technical analysts and traders looking for a more responsive moving average with reduced lag.
As with any technical indicator, it is essential to use the Nyquist Moving Average in conjunction with other indicators and analysis methods to maximize its effectiveness and reduce the risk of false signals.
What is the MACD?
The Moving Average Convergence Divergence (MACD) is a widely used technical analysis indicator developed by Gerald Appel in the late 1970s. The MACD is a momentum oscillator that helps traders identify changes in the strength, direction, and duration of a market trend. It is calculated using exponential moving averages (EMAs) and can provide buy and sell signals based on the interaction between the MACD line, the signal line, and the MACD histogram.
The MACD consists of three components:
1. MACD Line: The MACD line is calculated by subtracting a longer-period EMA from a shorter-period EMA. Typically, a 26-day EMA is subtracted from a 12-day EMA. The resulting line represents the difference between the two EMAs and highlights the momentum of the underlying asset.
2. Signal Line: The signal line is a 9-day EMA of the MACD line. It is used to smooth out the fluctuations of the MACD line and generate trading signals based on crossovers between the MACD line and the signal line.
3. MACD Histogram: The MACD histogram is a visual representation of the difference between the MACD line and the signal line. It is plotted as vertical bars above or below the zero line, with bars above the zero line indicating positive momentum and bars below the zero line indicating negative momentum.
The MACD generates trading signals based on the interaction between the MACD line, the signal line, and the MACD histogram:
1. Bullish Crossover: A buy signal is generated when the MACD line crosses above the signal line, indicating that the short-term momentum is stronger than the long-term momentum and suggesting a potential upward move in the asset's price.
2. Bearish Crossover: A sell signal is generated when the MACD line crosses below the signal line, indicating that the short-term momentum is weaker than the long-term momentum and suggesting a potential downward move in the asset's price.
3. Histogram Divergence: The MACD histogram can also provide signals based on divergences between the histogram and the asset's price. A bullish divergence occurs when the asset's price forms a lower low while the histogram forms a higher low, suggesting a potential reversal to the upside. A bearish divergence occurs when the asset's price forms a higher high while the histogram forms a lower high, suggesting a potential reversal to the downside.
It is essential to use the MACD in conjunction with other technical analysis tools and methods to increase the reliability of the signals and reduce the risk of false signals. Additionally, the MACD is a lagging indicator, meaning it is based on historical data and may not always provide timely signals.
What is the Nyquist Moving Average (NMA) MACD
This indicator uses the Nyquist Moving averge in the MACD caculation instead of the typical EMA.
Requirements
Inputs
Confirmation 1: GKD-V Volatility / Volume indicator
Confirmation 2: GKD-C Confirmation indicator
Continuation: GKD-C Confirmation indicator
Solo Confirmation Simple: GKD-B Baseline
Solo Confirmation Complex: GKD-V Volatility / Volume indicator
Solo Confirmation Super Complex: GKD-V Volatility / Volume indicator
Stacked 1: None
Stacked 2+: GKD-C, GKD-V, or GKD-B Stacked 1
Outputs
Confirmation 1: GKD-C Confirmation 2 indicator
Confirmation 2: GKD-C Continuation indicator
Continuation: GKD-E Exit indicator
Solo Confirmation Simple: GKD-BT Backtest
Solo Confirmation Complex: GKD-BT Backtest or GKD-E Exit indicator
Solo Confirmation Super Complex: GKD-C Continuation indicator
Stacked 1: GKD-C, GKD-V, or GKD-B Stacked 2+
Stacked 2+: GKD-C, GKD-V, or GKD-B Stacked 2+ or GKD-BT Backtest
Additional features will be added in future releases.
Know the trend - KTT---------- ENGLISH -----------
This indicator combines the values of four common indicators (MACD, MACD signal, normalized RSI and linear regression) to provide a unified view of the market trend. The indicator calculates the average of the rescaled values of these four indicators and plots it on the chart as a line that changes color based on its position relative to 0. If the line is above 0, it is colored black to indicate a bullish trend. If the line is below 0, it is colored red to indicate a bearish trend. The user can enter a value for the length of the indicator to customize the time period used for calculating the underlying indicators. The indicator works on any time frame.
---------- ITALIANO -----------
Questo indicatore combina i valori di quattro indicatori comuni (MACD, segnale MACD, RSI normalizzato e regressione lineare) per fornire una visione unificata del trend del mercato. L’indicatore calcola la media dei valori riscalati di questi quattro indicatori e la disegna sul grafico come una linea che cambia colore in base alla sua posizione rispetto allo 0. Se la linea è sopra lo 0, viene colorata di nero per indicare un trend rialzista. Se la linea è sotto lo 0, viene colorata di rosso per indicare un trend ribassista. L’utente può inserire un valore per la lunghezza dell’indicatore per personalizzare il periodo di tempo utilizzato per il calcolo degli indicatori sottostanti. L’indicatore funziona su ogni time frame.
GKD-C Stepped Moving Average of CCI [Loxx]Giga Kaleidoscope GKD-C Stepped Moving Average of CCI is a Confirmation module included in Loxx's "Giga Kaleidoscope Modularized Trading System".
█ Giga Kaleidoscope Modularized Trading System
What is Loxx's "Giga Kaleidoscope Modularized Trading System"?
The Giga Kaleidoscope Modularized Trading System is a trading system built on the philosophy of the NNFX (No Nonsense Forex) algorithmic trading.
What is the NNFX algorithmic trading strategy?
The NNFX (No-Nonsense Forex) trading system is a comprehensive approach to Forex trading that is designed to simplify the process and remove the confusion and complexity that often surrounds trading. The system was developed by a Forex trader who goes by the pseudonym "VP" and has gained a significant following in the Forex community.
The NNFX trading system is based on a set of rules and guidelines that help traders make objective and informed decisions. These rules cover all aspects of trading, including market analysis, trade entry, stop loss placement, and trade management.
Here are the main components of the NNFX trading system:
1. Trading Philosophy: The NNFX trading system is based on the idea that successful trading requires a comprehensive understanding of the market, objective analysis, and strict risk management. The system aims to remove subjective elements from trading and focuses on objective rules and guidelines.
2. Technical Analysis: The NNFX trading system relies heavily on technical analysis and uses a range of indicators to identify high-probability trading opportunities. The system uses a combination of trend-following and mean-reverting strategies to identify trades.
3. Market Structure: The NNFX trading system emphasizes the importance of understanding the market structure, including price action, support and resistance levels, and market cycles. The system uses a range of tools to identify the market structure, including trend lines, channels, and moving averages.
4. Trade Entry: The NNFX trading system has strict rules for trade entry. The system uses a combination of technical indicators to identify high-probability trades, and traders must meet specific criteria to enter a trade.
5. Stop Loss Placement: The NNFX trading system places a significant emphasis on risk management and requires traders to place a stop loss order on every trade. The system uses a combination of technical analysis and market structure to determine the appropriate stop loss level.
6. Trade Management: The NNFX trading system has specific rules for managing open trades. The system aims to minimize risk and maximize profit by using a combination of trailing stops, take profit levels, and position sizing.
Overall, the NNFX trading system is designed to be a straightforward and easy-to-follow approach to Forex trading that can be applied by traders of all skill levels.
Core components of an NNFX algorithmic trading strategy
The NNFX algorithm is built on the principles of trend, momentum, and volatility. There are six core components in the NNFX trading algorithm:
1. Volatility - price volatility; e.g., Average True Range, True Range Double, Close-to-Close, etc.
2. Baseline - a moving average to identify price trend
3. Confirmation 1 - a technical indicator used to identify trends
4. Confirmation 2 - a technical indicator used to identify trends
5. Continuation - a technical indicator used to identify trends
6. Volatility/Volume - a technical indicator used to identify volatility/volume breakouts/breakdown
7. Exit - a technical indicator used to determine when a trend is exhausted
What is Volatility in the NNFX trading system?
In the NNFX (No Nonsense Forex) trading system, ATR (Average True Range) is typically used to measure the volatility of an asset. It is used as a part of the system to help determine the appropriate stop loss and take profit levels for a trade. ATR is calculated by taking the average of the true range values over a specified period.
True range is calculated as the maximum of the following values:
-Current high minus the current low
-Absolute value of the current high minus the previous close
-Absolute value of the current low minus the previous close
ATR is a dynamic indicator that changes with changes in volatility. As volatility increases, the value of ATR increases, and as volatility decreases, the value of ATR decreases. By using ATR in NNFX system, traders can adjust their stop loss and take profit levels according to the volatility of the asset being traded. This helps to ensure that the trade is given enough room to move, while also minimizing potential losses.
Other types of volatility include True Range Double (TRD), Close-to-Close, and Garman-Klass
What is a Baseline indicator?
The baseline is essentially a moving average, and is used to determine the overall direction of the market.
The baseline in the NNFX system is used to filter out trades that are not in line with the long-term trend of the market. The baseline is plotted on the chart along with other indicators, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR).
Trades are only taken when the price is in the same direction as the baseline. For example, if the baseline is sloping upwards, only long trades are taken, and if the baseline is sloping downwards, only short trades are taken. This approach helps to ensure that trades are in line with the overall trend of the market, and reduces the risk of entering trades that are likely to fail.
By using a baseline in the NNFX system, traders can have a clear reference point for determining the overall trend of the market, and can make more informed trading decisions. The baseline helps to filter out noise and false signals, and ensures that trades are taken in the direction of the long-term trend.
What is a Confirmation indicator?
Confirmation indicators are technical indicators that are used to confirm the signals generated by primary indicators. Primary indicators are the core indicators used in the NNFX system, such as the Average True Range (ATR), the Moving Average (MA), and the Relative Strength Index (RSI).
The purpose of the confirmation indicators is to reduce false signals and improve the accuracy of the trading system. They are designed to confirm the signals generated by the primary indicators by providing additional information about the strength and direction of the trend.
Some examples of confirmation indicators that may be used in the NNFX system include the Bollinger Bands, the MACD (Moving Average Convergence Divergence), and the MACD Oscillator. These indicators can provide information about the volatility, momentum, and trend strength of the market, and can be used to confirm the signals generated by the primary indicators.
In the NNFX system, confirmation indicators are used in combination with primary indicators and other filters to create a trading system that is robust and reliable. By using multiple indicators to confirm trading signals, the system aims to reduce the risk of false signals and improve the overall profitability of the trades.
What is a Continuation indicator?
In the NNFX (No Nonsense Forex) trading system, a continuation indicator is a technical indicator that is used to confirm a current trend and predict that the trend is likely to continue in the same direction. A continuation indicator is typically used in conjunction with other indicators in the system, such as a baseline indicator, to provide a comprehensive trading strategy.
What is a Volatility/Volume indicator?
Volume indicators, such as the On Balance Volume (OBV), the Chaikin Money Flow (CMF), or the Volume Price Trend (VPT), are used to measure the amount of buying and selling activity in a market. They are based on the trading volume of the market, and can provide information about the strength of the trend. In the NNFX system, volume indicators are used to confirm trading signals generated by the Moving Average and the Relative Strength Index. Volatility indicators include Average Direction Index, Waddah Attar, and Volatility Ratio. In the NNFX trading system, volatility is a proxy for volume and vice versa.
By using volume indicators as confirmation tools, the NNFX trading system aims to reduce the risk of false signals and improve the overall profitability of trades. These indicators can provide additional information about the market that is not captured by the primary indicators, and can help traders to make more informed trading decisions. In addition, volume indicators can be used to identify potential changes in market trends and to confirm the strength of price movements.
What is an Exit indicator?
The exit indicator is used in conjunction with other indicators in the system, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR), to provide a comprehensive trading strategy.
The exit indicator in the NNFX system can be any technical indicator that is deemed effective at identifying optimal exit points. Examples of exit indicators that are commonly used include the Parabolic SAR, the Average Directional Index (ADX), and the Chandelier Exit.
The purpose of the exit indicator is to identify when a trend is likely to reverse or when the market conditions have changed, signaling the need to exit a trade. By using an exit indicator, traders can manage their risk and prevent significant losses.
In the NNFX system, the exit indicator is used in conjunction with a stop loss and a take profit order to maximize profits and minimize losses. The stop loss order is used to limit the amount of loss that can be incurred if the trade goes against the trader, while the take profit order is used to lock in profits when the trade is moving in the trader's favor.
Overall, the use of an exit indicator in the NNFX trading system is an important component of a comprehensive trading strategy. It allows traders to manage their risk effectively and improve the profitability of their trades by exiting at the right time.
How does Loxx's GKD (Giga Kaleidoscope Modularized Trading System) implement the NNFX algorithm outlined above?
Loxx's GKD v1.0 system has five types of modules (indicators/strategies). These modules are:
1. GKD-BT - Backtesting module (Volatility, Number 1 in the NNFX algorithm)
2. GKD-B - Baseline module (Baseline and Volatility/Volume, Numbers 1 and 2 in the NNFX algorithm)
3. GKD-C - Confirmation 1/2 and Continuation module (Confirmation 1/2 and Continuation, Numbers 3, 4, and 5 in the NNFX algorithm)
4. GKD-V - Volatility/Volume module (Confirmation 1/2, Number 6 in the NNFX algorithm)
5. GKD-E - Exit module (Exit, Number 7 in the NNFX algorithm)
(additional module types will added in future releases)
Each module interacts with every module by passing data between modules. Data is passed between each module as described below:
GKD-B => GKD-V => GKD-C(1) => GKD-C(2) => GKD-C(Continuation) => GKD-E => GKD-BT
That is, the Baseline indicator passes its data to Volatility/Volume. The Volatility/Volume indicator passes its values to the Confirmation 1 indicator. The Confirmation 1 indicator passes its values to the Confirmation 2 indicator. The Confirmation 2 indicator passes its values to the Continuation indicator. The Continuation indicator passes its values to the Exit indicator, and finally, the Exit indicator passes its values to the Backtest strategy.
This chaining of indicators requires that each module conform to Loxx's GKD protocol, therefore allowing for the testing of every possible combination of technical indicators that make up the six components of the NNFX algorithm.
What does the application of the GKD trading system look like?
Example trading system:
Backtest: Strategy with 1-3 take profits, trailing stop loss, multiple types of PnL volatility, and 2 backtesting styles
Baseline: Hull Moving Average
Volatility/Volume: Hurst Exponent
Confirmation 1: Stepped Moving Average of CCI as shown on the chart above
Confirmation 2: Williams Percent Range
Continuation: Fisher Transform
Exit: Rex Oscillator
Each GKD indicator is denoted with a module identifier of either: GKD-BT, GKD-B, GKD-C, GKD-V, or GKD-E. This allows traders to understand to which module each indicator belongs and where each indicator fits into the GKD protocol chain.
Giga Kaleidoscope Modularized Trading System Signals (based on the NNFX algorithm)
Standard Entry
1. GKD-C Confirmation 1 Signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
6. GKD-C Confirmation 1 signal was less than 7 candles prior
Volatility/Volume Entry
1. GKD-V Volatility/Volume signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-B Baseline agrees
6. GKD-C Confirmation 1 signal was less than 7 candles prior
Continuation Entry
1. Standard Entry, Baseline Entry, or Pullback; entry triggered previously
2. GKD-B Baseline hasn't crossed since entry signal trigger
3. GKD-C Confirmation Continuation Indicator signals
4. GKD-C Confirmation 1 agrees
5. GKD-B Baseline agrees
6. GKD-C Confirmation 2 agrees
1-Candle Rule Standard Entry
1. GKD-C Confirmation 1 signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
1-Candle Rule Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 1 signal was less than 7 candles prior
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume Agrees
1-Candle Rule Volatility/Volume Entry
1. GKD-V Volatility/Volume signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 1 signal was less than 7 candles prior
Next Candle:
1. Price retraced (Long: close < close or Short: close > close)
2. GKD-B Volatility/Volume agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-B Baseline agrees
PullBack Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is beyond 1.0x Volatility of Baseline
Next Candle:
1. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
2. GKD-C Confirmation 1 agrees
3. GKD-C Confirmation 2 agrees
4. GKD-V Volatility/Volume Agrees
]█ Setting up the GKD
The GKD system involves chaining indicators together. These are the steps to set this up.
Use a GKD-C indicator alone on a chart
1. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Simple"
Use a GKD-V indicator alone on a chart
**nothing, it's already useable on the chart without any settings changes
Use a GKD-B indicator alone on a chart
**nothing, it's already useable on the chart without any settings changes
Baseline (Baseline, Backtest)
1. Import the GKD-B Baseline into the GKD-BT Backtest: "Input into Volatility/Volume or Backtest (Baseline testing)"
2. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Baseline"
Volatility/Volume (Volatility/Volume, Backte st)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Solo"
2. Inside the GKD-V indicator, change the "Signal Type" setting to "Crossing" (neither traditional nor both can be backtested)
3. Import the GKD-V indicator into the GKD-BT Backtest: "Input into C1 or Backtest"
4. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Volatility/Volume"
5. Inside the GKD-BT Backtest, a) change the setting "Backtest Type" to "Trading" if using a directional GKD-V indicator; or, b) change the setting "Backtest Type" to "Full" if using a directional or non-directional GKD-V indicator (non-directional GKD-V can only test Longs and Shorts separately)
6. If "Backtest Type" is set to "Full": Inside the GKD-BT Backtest, change the setting "Backtest Side" to "Long" or "Short
7. If "Backtest Type" is set to "Full": To allow the system to open multiple orders at one time so you test all Longs or Shorts, open the GKD-BT Backtest, click the tab "Properties" and then insert a value of something like 10 orders into the "Pyramiding" settings. This will allow 10 orders to be opened at one time which should be enough to catch all possible Longs or Shorts.
Solo Confirmation Simple (Confirmation, Backtest)
1. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Simple"
1. Import the GKD-C indicator into the GKD-BT Backtest: "Input into Backtest"
2. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Solo Confirmation Simple"
Solo Confirmation Complex without Exits (Baseline, Volatility/Volume, Confirmation, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Complex"
4. Import the GKD-V indicator into the GKD-C indicator: "Input into C1 or Backtest"
5. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full wo/ Exits"
6. Import the GKD-C into the GKD-BT Backtest: "Input into Exit"
Solo Confirmation Complex with Exits (Baseline, Volatility/Volume, Confirmation, Exit, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C indicator, change the "Confirmation Type" setting to "Solo Confirmation Complex"
4. Import the GKD-V indicator into the GKD-C indicator: "Input into C1 or Backtest"
5. Import the GKD-C indicator into the GKD-E indicator: "Input into Exit"
6. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full w/ Exits"
7. Import the GKD-E into the GKD-BT Backtest: "Input into Backtest"
Full GKD without Exits (Baseline, Volatility/Volume, Confirmation 1, Confirmation 2, Continuation, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C 1 indicator, change the "Confirmation Type" setting to "Confirmation 1"
4. Import the GKD-V indicator into the GKD-C 1 indicator: "Input into C1 or Backtest"
5. Inside the GKD-C 2 indicator, change the "Confirmation Type" setting to "Confirmation 2"
6. Import the GKD-C 1 indicator into the GKD-C 2 indicator: "Input into C2"
7. Inside the GKD-C Continuation indicator, change the "Confirmation Type" setting to "Continuation"
8. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full wo/ Exits"
9. Import the GKD-E into the GKD-BT Backtest: "Input into Exit"
Full GKD with Exits (Baseline, Volatility/Volume, Confirmation 1, Confirmation 2, Continuation, Exit, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Chained"
2. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
3. Inside the GKD-C 1 indicator, change the "Confirmation Type" setting to "Confirmation 1"
4. Import the GKD-V indicator into the GKD-C 1 indicator: "Input into C1 or Backtest"
5. Inside the GKD-C 2 indicator, change the "Confirmation Type" setting to "Confirmation 2"
6. Import the GKD-C 1 indicator into the GKD-C 2 indicator: "Input into C2"
7. Inside the GKD-C Continuation indicator, change the "Confirmation Type" setting to "Continuation"
8. Import the GKD-C Continuation indicator into the GKD-E indicator: "Input into Exit"
9. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "GKD Full w/ Exits"
10. Import the GKD-E into the GKD-BT Backtest: "Input into Backtest"
Baseline + Volatility/Volume (Baseline, Volatility/Volume, Backtest)
1. Inside the GKD-V indicator, change the "Testing Type" setting to "Baseline + Volatility/Volume"
2. Inside the GKD-V indicator, make sure the "Signal Type" setting is set to "Traditional"
3. Import the GKD-B Baseline into the GKD-V indicator: "Input into Volatility/Volume or Backtest (Baseline testing)"
4. Inside the GKD-BT Backtest, change the setting "Backtest Special" to "Baseline + Volatility/Volume"
5. Import the GKD-V into the GKD-BT Backtest: "Input into C1 or Backtest"
6. Inside the GKD-BT Backtest, change the setting "Backtest Type" to "Full". For this backtest, you must test Longs and Shorts separately
7. To allow the system to open multiple orders at one time so you can test all Longs or Shorts, open the GKD-BT Backtest, click the tab "Properties" and then insert a value of something like 10 orders into the "Pyramiding" settings. This will allow 10 orders to be opened at one time which should be enough to catch all possible Longs or Shorts.
█ GKD-C Stepped Moving Average of CCI
What is Stepped Moving Average?
The Step MA function is a custom implementation of a step-moving average that uses the high and low prices of a security, along with the current price, to calculate the maximum and minimum step-moving average values. It then determines the current trend based on the relationship between the current price and the maximum and minimum values, and calculates the step-moving average for that trend. The calculated step-moving average is returned as the output of the function.
What is CCI?
CCI, or Commodity Channel Index, is a momentum-based technical analysis indicator developed by Donald Lambert in 1980. Initially created for the commodity markets, CCI has since been widely adopted for use in various financial markets, including stocks, forex, and indices.
The CCI measures the difference between the current price and its historical average relative to the average price fluctuations over a specific period. It helps traders identify potential overbought and oversold conditions and possible trend reversals.
The CCI is calculated as follows:
Calculate the Typical Price (TP) for each period: TP = (High + Low + Close) / 3
Calculate the Simple Moving Average (SMA) of the Typical Price over the chosen period (usually 14 or 20 periods).
Calculate the Mean Deviation (MD) by finding the average of the absolute difference between the Typical Price and its SMA for each period.
Calculate the CCI: CCI = (Typical Price - SMA) / (0.015 * Mean Deviation)
The constant 0.015 is a scaling factor that brings the CCI values within a standardized range, typically -100 to +100. Some traders might use different scaling factors depending on their preferences.
When using the CCI, traders consider the following:
Values above +100 typically indicate overbought conditions, suggesting a potential price decline.
Values below -100 typically indicate oversold conditions, suggesting a potential price increase.
CCI crossing above or below the zero line can signal a change in the direction of the market trend.
It is important to note that the CCI is a versatile indicator and can be used in combination with other technical analysis tools to improve the accuracy of trading signals.
What is the Stepped Moving Average of CCI?
This indicator runs the CCI through Stepped Moving Average algorithm to derive a smoother CCI.
Requirements
Inputs
Confirmation 1: GKD-V Volatility / Volume indicator
Confirmation 2: GKD-C Confirmation indicator
Continuation: GKD-C Confirmation indicator
Solo Confirmation Simple: GKD-B Baseline
Solo Confirmation Complex: GKD-V Volatility / Volume indicator
Solo Confirmation Super Complex: GKD-V Volatility / Volume indicator
Stacked 1: None
Stacked 2+: GKD-C, GKD-V, or GKD-B Stacked 1
Outputs
Confirmation 1: GKD-C Confirmation 2 indicator
Confirmation 2: GKD-C Continuation indicator
Continuation: GKD-E Exit indicator
Solo Confirmation Simple: GKD-BT Backtest
Solo Confirmation Complex: GKD-BT Backtest or GKD-E Exit indicator
Solo Confirmation Super Complex: GKD-C Continuation indicator
Stacked 1: GKD-C, GKD-V, or GKD-B Stacked 2+
Stacked 2+: GKD-C, GKD-V, or GKD-B Stacked 2+ or GKD-BT Backtest
Additional features will be added in future releases.
SAR MACDSAR MACD is an idea of implementing Directional MACD with Parabolic SAR to exactly detect and confirm Trend. This p-SAR MACD consist of a HYBRID MACD which acts as MACD TREND oscillator, MACD Oscillator, PSAR Indicator combined with MA line. thus Fake MACD Signals can be eliminated using this SAR MACD. Sideways can be detected using Threshold Levels must be adjusted based on timeframe.
Indicators Hybrid model contains:
1.MACD (12,26,9) Standard with MA Crossovers
2.MACD Trend
3.Parabolic SAR with 0.02
4.Threshold level - indicates Sideways
How to use.
Histogram:
-> HIST MODE: normal MACD indicator
MA Line Color is based on PSAR Direction Blue-Up/ Pink -Down
A crossover upside with a Blue MA line denotes Up confirmation
A Crossover downwards with a red MA line denotes Down Confirmation
Additionally Histogram above zero line and below zero line are to be confirmed
-> MACD MODE: MACD Trend indicator
MA Line Color is based on PSAR Direction Blue-Up/ Pink -Down
A crossover upside with a Blue MA line denotes Up confirmation
A Crossover downwards with a red MA line denotes Down Confirmation
Additionally Histogram above zero line and below zero denotes long term Trend
-> Histogram Color: Indicates candles direction
Yellow indicates Unconfirmed Direction
Green Indicates up direction
Red Indicates Down Direction
Buy Condition:
MA Color - Blue
Histogram- Above Zero
Histogram/Candle -Green
MA Crossover is must
Sell Condition:
MA Color - Red
Histogram- Below Zero
Histogram/Candle -Red
MA Cross under is must
Warning: Must not be used as a standalone indicator. Use for confirmation of your Buy Sell Signals and Entry only.
KST-Based MACDAs a follow-up to my previous script:
I am posting a stand-alone KST-based MACD.
Note that this indicator is highly laggy. Specific care must be taken when using it.
The MACD-Signal crossing is quite delayed but it is a definite confirmation.
For earlier signs, the Histogram must be analyzed. A shift from Green-White signals the 1st Bear Signal.
A MACD-Signal crossing signals the 2nd Bear SIgnal.
The same applies for bull-signs.
This indicator is useful for long-term charts on which one might want to pinpoint clear, longterm divergences.
Standard RSI, Stochastic RSI and MACD are notoriously problematic when trying to pinpoint long-term divergences.
Finally, this indicator is not meant for pinpointing entry-exit positions. I find it useful for macro analysis. In my experience, the decreased sensitivity of this indicator can show very strong signs, that can be quite laggy.
Inside the indicator there is a setting for "exotic calculations". This is an attempt to make this chart work in both linear/ negative charts (T10Y2Y) and log charts (SPX)
Tread lightly, for this is hallowed ground.
-Father Grigori
[blackcat] L3 Banker Fund Oscillator GeminiLevel 3
Background
The large funds or banker fund are often referred to as Whale. Whale can have a significant impact on the price movements in various markets, especially in cryptocurrency . Therefore, how to monitor Whale trends is of great significance both in terms of fundamentals and technical aspects.
Function
I had published (blackcat1402) L3/L4/L5 Banker Fund Flow Trend Oscillator as open sourced version. Since this indicator is one of the most popular indicators in my collections. Many requested advanced features and improvements on accuracy. Here is the link of free version of
L3 Banker Fund Flow Trend Oscillator:
L4 Banker Fund Flow Trend Oscillator:
L5 Banker Fund Flow Trend Oscillator:
To futher develop this category, here i published L3 Banker Fund Oscillator Gemini targetting to make a combo of various types of banker fund models together. Since it is a oscillator ranging 0 to 100, overbought and oversold zones were defined which use dotted yellow-green hline for the former and dotted yellow-red hline for the later.
middle term banker fund model:
red bars : bullish
green bars : bearish
short term banker fund model:
yellow bars : bullish
fuchsia bars : bearish
if middle term banker fund resonantes with short term banker fund for bullish, then it is a strong/confirmed bullish trend.
if middle term banker fund resonantes with short term banker fund for bearish, then it is a strong/confirmed bearish trend.
Remarks
Feedbacks are appreciated.
GKD-C VHF-Adaptive Super Smoother Velocity [Loxx]Giga Kaleidoscope GKD-C VHF-Adaptive Super Smoother Velocity is a Confirmation module included in Loxx's "Giga Kaleidoscope Modularized Trading System".
█ Giga Kaleidoscope Modularized Trading System
What is Loxx's "Giga Kaleidoscope Modularized Trading System"?
The Giga Kaleidoscope Modularized Trading System is a trading system built on the philosophy of the NNFX (No Nonsense Forex) algorithmic trading.
What is the NNFX algorithmic trading strategy?
The NNFX (No-Nonsense Forex) trading system is a comprehensive approach to Forex trading that is designed to simplify the process and remove the confusion and complexity that often surrounds trading. The system was developed by a Forex trader who goes by the pseudonym "VP" and has gained a significant following in the Forex community.
The NNFX trading system is based on a set of rules and guidelines that help traders make objective and informed decisions. These rules cover all aspects of trading, including market analysis, trade entry, stop loss placement, and trade management.
Here are the main components of the NNFX trading system:
1. Trading Philosophy: The NNFX trading system is based on the idea that successful trading requires a comprehensive understanding of the market, objective analysis, and strict risk management. The system aims to remove subjective elements from trading and focuses on objective rules and guidelines.
2. Technical Analysis: The NNFX trading system relies heavily on technical analysis and uses a range of indicators to identify high-probability trading opportunities. The system uses a combination of trend-following and mean-reverting strategies to identify trades.
3. Market Structure: The NNFX trading system emphasizes the importance of understanding the market structure, including price action, support and resistance levels, and market cycles. The system uses a range of tools to identify the market structure, including trend lines, channels, and moving averages.
4. Trade Entry: The NNFX trading system has strict rules for trade entry. The system uses a combination of technical indicators to identify high-probability trades, and traders must meet specific criteria to enter a trade.
5. Stop Loss Placement: The NNFX trading system places a significant emphasis on risk management and requires traders to place a stop loss order on every trade. The system uses a combination of technical analysis and market structure to determine the appropriate stop loss level.
6. Trade Management: The NNFX trading system has specific rules for managing open trades. The system aims to minimize risk and maximize profit by using a combination of trailing stops, take profit levels, and position sizing.
Overall, the NNFX trading system is designed to be a straightforward and easy-to-follow approach to Forex trading that can be applied by traders of all skill levels.
Core components of an NNFX algorithmic trading strategy
The NNFX algorithm is built on the principles of trend, momentum, and volatility. There are six core components in the NNFX trading algorithm:
1. Volatility - price volatility; e.g., Average True Range, True Range Double, Close-to-Close, etc.
2. Baseline - a moving average to identify price trend
3. Confirmation 1 - a technical indicator used to identify trends
4. Confirmation 2 - a technical indicator used to identify trends
5. Continuation - a technical indicator used to identify trends
6. Volatility/Volume - a technical indicator used to identify volatility/volume breakouts/breakdown
7. Exit - a technical indicator used to determine when a trend is exhausted
What is Volatility in the NNFX trading system?
In the NNFX (No Nonsense Forex) trading system, ATR (Average True Range) is typically used to measure the volatility of an asset. It is used as a part of the system to help determine the appropriate stop loss and take profit levels for a trade. ATR is calculated by taking the average of the true range values over a specified period.
True range is calculated as the maximum of the following values:
-Current high minus the current low
-Absolute value of the current high minus the previous close
-Absolute value of the current low minus the previous close
ATR is a dynamic indicator that changes with changes in volatility. As volatility increases, the value of ATR increases, and as volatility decreases, the value of ATR decreases. By using ATR in NNFX system, traders can adjust their stop loss and take profit levels according to the volatility of the asset being traded. This helps to ensure that the trade is given enough room to move, while also minimizing potential losses.
Other types of volatility include True Range Double (TRD), Close-to-Close, and Garman-Klass
What is a Baseline indicator?
The baseline is essentially a moving average, and is used to determine the overall direction of the market.
The baseline in the NNFX system is used to filter out trades that are not in line with the long-term trend of the market. The baseline is plotted on the chart along with other indicators, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR).
Trades are only taken when the price is in the same direction as the baseline. For example, if the baseline is sloping upwards, only long trades are taken, and if the baseline is sloping downwards, only short trades are taken. This approach helps to ensure that trades are in line with the overall trend of the market, and reduces the risk of entering trades that are likely to fail.
By using a baseline in the NNFX system, traders can have a clear reference point for determining the overall trend of the market, and can make more informed trading decisions. The baseline helps to filter out noise and false signals, and ensures that trades are taken in the direction of the long-term trend.
What is a Confirmation indicator?
Confirmation indicators are technical indicators that are used to confirm the signals generated by primary indicators. Primary indicators are the core indicators used in the NNFX system, such as the Average True Range (ATR), the Moving Average (MA), and the Relative Strength Index (RSI).
The purpose of the confirmation indicators is to reduce false signals and improve the accuracy of the trading system. They are designed to confirm the signals generated by the primary indicators by providing additional information about the strength and direction of the trend.
Some examples of confirmation indicators that may be used in the NNFX system include the Bollinger Bands, the MACD (Moving Average Convergence Divergence), and the MACD Oscillator. These indicators can provide information about the volatility, momentum, and trend strength of the market, and can be used to confirm the signals generated by the primary indicators.
In the NNFX system, confirmation indicators are used in combination with primary indicators and other filters to create a trading system that is robust and reliable. By using multiple indicators to confirm trading signals, the system aims to reduce the risk of false signals and improve the overall profitability of the trades.
What is a Continuation indicator?
In the NNFX (No Nonsense Forex) trading system, a continuation indicator is a technical indicator that is used to confirm a current trend and predict that the trend is likely to continue in the same direction. A continuation indicator is typically used in conjunction with other indicators in the system, such as a baseline indicator, to provide a comprehensive trading strategy.
What is a Volatility/Volume indicator?
Volume indicators, such as the On Balance Volume (OBV), the Chaikin Money Flow (CMF), or the Volume Price Trend (VPT), are used to measure the amount of buying and selling activity in a market. They are based on the trading volume of the market, and can provide information about the strength of the trend. In the NNFX system, volume indicators are used to confirm trading signals generated by the Moving Average and the Relative Strength Index. Volatility indicators include Average Direction Index, Waddah Attar, and Volatility Ratio. In the NNFX trading system, volatility is a proxy for volume and vice versa.
By using volume indicators as confirmation tools, the NNFX trading system aims to reduce the risk of false signals and improve the overall profitability of trades. These indicators can provide additional information about the market that is not captured by the primary indicators, and can help traders to make more informed trading decisions. In addition, volume indicators can be used to identify potential changes in market trends and to confirm the strength of price movements.
What is an Exit indicator?
The exit indicator is used in conjunction with other indicators in the system, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR), to provide a comprehensive trading strategy.
The exit indicator in the NNFX system can be any technical indicator that is deemed effective at identifying optimal exit points. Examples of exit indicators that are commonly used include the Parabolic SAR, the Average Directional Index (ADX), and the Chandelier Exit.
The purpose of the exit indicator is to identify when a trend is likely to reverse or when the market conditions have changed, signaling the need to exit a trade. By using an exit indicator, traders can manage their risk and prevent significant losses.
In the NNFX system, the exit indicator is used in conjunction with a stop loss and a take profit order to maximize profits and minimize losses. The stop loss order is used to limit the amount of loss that can be incurred if the trade goes against the trader, while the take profit order is used to lock in profits when the trade is moving in the trader's favor.
Overall, the use of an exit indicator in the NNFX trading system is an important component of a comprehensive trading strategy. It allows traders to manage their risk effectively and improve the profitability of their trades by exiting at the right time.
How does Loxx's GKD (Giga Kaleidoscope Modularized Trading System) implement the NNFX algorithm outlined above?
Loxx's GKD v1.0 system has five types of modules (indicators/strategies). These modules are:
1. GKD-BT - Backtesting module (Volatility, Number 1 in the NNFX algorithm)
2. GKD-B - Baseline module (Baseline and Volatility/Volume, Numbers 1 and 2 in the NNFX algorithm)
3. GKD-C - Confirmation 1/2 and Continuation module (Confirmation 1/2 and Continuation, Numbers 3, 4, and 5 in the NNFX algorithm)
4. GKD-V - Volatility/Volume module (Confirmation 1/2, Number 6 in the NNFX algorithm)
5. GKD-E - Exit module (Exit, Number 7 in the NNFX algorithm)
(additional module types will added in future releases)
Each module interacts with every module by passing data between modules. Data is passed between each module as described below:
GKD-B => GKD-V => GKD-C(1) => GKD-C(2) => GKD-C(Continuation) => GKD-E => GKD-BT
That is, the Baseline indicator passes its data to Volatility/Volume. The Volatility/Volume indicator passes its values to the Confirmation 1 indicator. The Confirmation 1 indicator passes its values to the Confirmation 2 indicator. The Confirmation 2 indicator passes its values to the Continuation indicator. The Continuation indicator passes its values to the Exit indicator, and finally, the Exit indicator passes its values to the Backtest strategy.
This chaining of indicators requires that each module conform to Loxx's GKD protocol, therefore allowing for the testing of every possible combination of technical indicators that make up the six components of the NNFX algorithm.
What does the application of the GKD trading system look like?
Example trading system:
Backtest: Strategy with 1-3 take profits, trailing stop loss, multiple types of PnL volatility, and 2 backtesting styles
Baseline: Hull Moving Average
Volatility/Volume: Hurst Exponent
Confirmation 1: VHF-Adaptive Super Smoother Velocity as shown on the chart above
Confirmation 2: Williams Percent Range
Continuation: Fisher Transform
Exit: Rex Oscillator
Each GKD indicator is denoted with a module identifier of either: GKD-BT, GKD-B, GKD-C, GKD-V, or GKD-E. This allows traders to understand to which module each indicator belongs and where each indicator fits into the GKD protocol chain.
Giga Kaleidoscope Modularized Trading System Signals (based on the NNFX algorithm)
Standard Entry
1. GKD-C Confirmation 1 Signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
6. GKD-C Confirmation 1 signal was less than 7 candles prior
Continuation Entry
1. Standard Entry, Baseline Entry, or Pullback; entry triggered previously
2. GKD-B Baseline hasn't crossed since entry signal trigger
3. GKD-C Confirmation Continuation Indicator signals
4. GKD-C Confirmation 1 agrees
5. GKD-B Baseline agrees
6. GKD-C Confirmation 2 agrees
1-Candle Rule Standard Entry
1. GKD-C Confirmation 1 signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
1-Candle Rule Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 1 signal was less than 7 candles prior
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume Agrees
PullBack Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is beyond 1.0x Volatility of Baseline
Next Candle:
1. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume Agrees
█ GKD-C VHF-Adaptive Super Smoother Velocity
What is a Vertical Horizontal Filter?
The Vertical Horizontal Filter (VHF) is a technical indicator used in trading to identify whether a market is trending or in a sideways trading range. It was developed by Adam White, and is based on the concept that markets tend to exhibit more volatility when they are trending, and less volatility when they are in a sideways range.
The VHF is calculated by taking the ratio of the range of the high and low prices over a specified period to the total range of prices over the same period. The resulting ratio is then multiplied by 100 to create a percentage value.
If the VHF is above a certain threshold, typically 60, it is considered to be indicating a trending market. If it is below the threshold, it is indicating a sideways trading range.
Traders use the VHF to help identify market conditions and to adjust their trading strategies accordingly. In a trending market, traders may look for opportunities to enter or exit positions based on the direction of the trend, while in a sideways trading range, traders may look for opportunities to buy at the bottom of the range and sell at the top.
The VHF can also be used in conjunction with other technical indicators, such as moving averages or momentum indicators, to help confirm trading signals. For example, if the VHF is indicating a trending market and the moving average is also indicating a trend, this may provide a stronger signal to enter or exit a trade.
One potential limitation of the VHF is that it can be less effective in markets that are transitioning between trending and sideways trading ranges. During these periods, the VHF may not accurately reflect the current market conditions, and traders may need to use other indicators or methods to help identify the current trend.
In summary, the Vertical Horizontal Filter (VHF) is a technical indicator used in trading to identify whether a market is trending or in a sideways trading range. It is based on the concept that markets exhibit more volatility when they are trending, and less volatility when they are in a sideways range. Traders use the VHF to help identify market conditions and adjust their trading strategies accordingly.
What is the Super Smoother?
developed by John F. Ehlers. This filter is based on aerospace analog filters and is specifically designed to reduce noise in price data. The noise in price data becomes more pronounced as the high-to-low price swings increase, particularly when the chart is plotted for greater time intervals. The Super Smoother Filter was created to address this problem by eliminating noise entirely, as opposed to moving averages such as the exponential moving average (EMA), which only offer a modest attenuation effect.
The aerospace analog filters that serve as the basis for the Super Smoother Filter are known for their ability to produce incredibly smooth signals while maintaining minimal lag. Ehlers adapted this technology to create a filter that is ideally suited for financial data, particularly when it comes to eliminating noise from price charts.
One of the key advantages of the Super Smoother Filter is its ability to provide a high level of accuracy in identifying trend changes. The filter is able to detect trend reversals with a high degree of precision, allowing traders to make more informed decisions about when to enter or exit a trade.
Overall, the Ehlers’ Super Smoother Filter is a powerful tool for traders and investors looking to reduce noise in price data and identify trend changes with a high level of accuracy. Its unique design, based on aerospace analog filters, makes it an ideal solution for financial data and sets it apart from other smoothing techniques such as moving averages.
What is VHF-Adaptive Super Smoother Velocity?
The VHF Adaptive approach is applied to the calculation of the momentum indicator. The code first calculates the highest and lowest values of the input source over a specified period using the ta.highest and ta.lowest functions. It then computes the noise level by taking the sum of the absolute price changes over the same period.
The VHF ratio is then calculated as the difference between the highest and lowest values divided by the noise level. This ratio is used to determine the time period, tperiod, for the momentum indicator calculation. The tperiod is calculated as a negative logarithmic function of the VHF ratio, which ensures that the time period decreases as the VHF ratio increases, i.e., as the level of volatility in the market increases. The tperiod is then adjusted to ensure it is not less than one.
Finally, the momentum indicator is computed using the Super Smoother Filter (super) applied to the input source with the time period raised to a power of 0.95 for the upper band and 1.05 for the lower band. The power function also ensures that the time period is adjusted based on the VHF ratio, making the indicator more adaptive to changes in market volatility. There are two signal types: middle and levels crosses.
Requirements
Inputs
Confirmation 1 and Solo Confirmation: GKD-V Volatility / Volume indicator
Confirmation 2: GKD-C Confirmation indicator
Outputs
Confirmation 2 and Solo Confirmation Complex: GKD-E Exit indicator
Confirmation 1: GKD-C Confirmation indicator
Continuation: GKD-E Exit indicator
Solo Confirmation Simple: GKD-BT Backtest strategy
Additional features will be added in future releases.
KST con HMA---------- ENGLISH DESCRIPTION ----------
The indicator created is called "KST with HMA" and is used to measure the impulse of an asset's price.
The code begins by defining four variables representing ROC (Rate of Change) period lengths for calculating the KST (Know Sure Thing) and a variable for the length of the HMA (Hull Moving Average).
Next, an HMA function is defined to calculate the Hull Moving Average, a type of weighted moving average that adjusts for price volatility.
ROC values are then calculated for the four periods defined above and KST values are calculated as a weighted sum of the ROC values. These values are then normalized with the HMA and the standard deviation of the HMA is calculated. The normalized value is finally plotted with three different color lines: black for values greater than 1, red for values less than -1, and green for values between -1 and 1.
Finally, a black dashed line is plotted to represent the zero line. The green line indicates a phase of market uncertainty or lateralization, while the indicator can be used to identify buy points above zero and sell points below zero.
---------- ITALIAN DESCRIPTION ----------
L'indicatore creato è chiamato "KST con HMA" e viene utilizzato per misurare l'impulso del prezzo di un asset.
Il codice inizia definendo quattro variabili che rappresentano le lunghezze dei periodi di ROC (Rate of Change) per il calcolo del KST (Know Sure Thing) e una variabile per la lunghezza dell'HMA (Hull Moving Average).
Successivamente viene definita una funzione HMA per il calcolo della Hull Moving Average, un tipo di media mobile ponderata che si adatta alla volatilità del prezzo.
Vengono poi calcolati i valori ROC per i quattro periodi definiti in precedenza e calcolati i valori KST come somma ponderata dei valori ROC. Questi valori vengono poi normalizzati con l'HMA e viene calcolata la deviazione standard dell'HMA. Il valore normalizzato viene infine plottato con tre diverse linee di colore: nero per valori superiori a 1, rosso per valori inferiori a -1 e verde per valori tra -1 e 1.
Infine, viene plottata una linea tratteggiata nera per rappresentare la linea zero. La linea verde indica una fase di incertezza o lateralizzazione del mercato, mentre l'indicatore può essere utilizzato per individuare punti di acquisto sopra lo zero e di vendita al di sotto dello zero.
Reversal Magic BTC [Loxx]What is Reversal Magic BTC ?
Reversal Magic BTC is an indicator that probes momentum and volatility for extreme values up/down to determine where possible reversals may occur for BTCUSD or BTCUSDT pairs. This is a highly specialized indicator tuned only to BTCUSD or BTCUSDT pairs and it only works on the daily timeframe. If you try to use this on any other ticker or any other timeframe other than the daily, then you'll see the indicator pop up with an error next to its name.
Settings
This indicator has two very simple settings:
1) High/Low period to probe highs and lows over the last XX candles
2) Volatility period to calculate the average volatility over the last XX candles
█ How do you use this?
Reversal trading
Ideally you would pair this indicator with a volatility indicator that shows volatility levels from closing price and then set a take profit level at 1x sigma up or down, and stoploss at 1.5x sigma up or down depending on the direction of the trade. Please note: reversal trading is extremely risky as a trend has not yet been established to confirm market direction.
The following indicators are ideal for this scenario
Profit Bands
Multi-Panel: Trade-Volatility-Probability
Swing Trading
This indicator can also be used as an exit indicator to be paired with a trend trading system where you would exit at the extremes up or down.
GKD-C Blau Candlestick Index [Loxx]Giga Kaleidoscope GKD-C Blau Candlestick Index is a Confirmation module included in Loxx's "Giga Kaleidoscope Modularized Trading System".
█ Giga Kaleidoscope Modularized Trading System
What is Loxx's "Giga Kaleidoscope Modularized Trading System"?
The Giga Kaleidoscope Modularized Trading System is a trading system built on the philosophy of the NNFX (No Nonsense Forex) algorithmic trading.
What is the NNFX algorithmic trading strategy?
The NNFX (No-Nonsense Forex) trading system is a comprehensive approach to Forex trading that is designed to simplify the process and remove the confusion and complexity that often surrounds trading. The system was developed by a Forex trader who goes by the pseudonym "VP" and has gained a significant following in the Forex community.
The NNFX trading system is based on a set of rules and guidelines that help traders make objective and informed decisions. These rules cover all aspects of trading, including market analysis, trade entry, stop loss placement, and trade management.
Here are the main components of the NNFX trading system:
1. Trading Philosophy: The NNFX trading system is based on the idea that successful trading requires a comprehensive understanding of the market, objective analysis, and strict risk management. The system aims to remove subjective elements from trading and focuses on objective rules and guidelines.
2. Technical Analysis: The NNFX trading system relies heavily on technical analysis and uses a range of indicators to identify high-probability trading opportunities. The system uses a combination of trend-following and mean-reverting strategies to identify trades.
3. Market Structure: The NNFX trading system emphasizes the importance of understanding the market structure, including price action, support and resistance levels, and market cycles. The system uses a range of tools to identify the market structure, including trend lines, channels, and moving averages.
4. Trade Entry: The NNFX trading system has strict rules for trade entry. The system uses a combination of technical indicators to identify high-probability trades, and traders must meet specific criteria to enter a trade.
5. Stop Loss Placement: The NNFX trading system places a significant emphasis on risk management and requires traders to place a stop loss order on every trade. The system uses a combination of technical analysis and market structure to determine the appropriate stop loss level.
6. Trade Management: The NNFX trading system has specific rules for managing open trades. The system aims to minimize risk and maximize profit by using a combination of trailing stops, take profit levels, and position sizing.
Overall, the NNFX trading system is designed to be a straightforward and easy-to-follow approach to Forex trading that can be applied by traders of all skill levels.
Core components of an NNFX algorithmic trading strategy
The NNFX algorithm is built on the principles of trend, momentum, and volatility. There are six core components in the NNFX trading algorithm:
1. Volatility - price volatility; e.g., Average True Range, True Range Double, Close-to-Close, etc.
2. Baseline - a moving average to identify price trend
3. Confirmation 1 - a technical indicator used to identify trends
4. Confirmation 2 - a technical indicator used to identify trends
5. Continuation - a technical indicator used to identify trends
6. Volatility/Volume - a technical indicator used to identify volatility/volume breakouts/breakdown
7. Exit - a technical indicator used to determine when a trend is exhausted
What is Volatility in the NNFX trading system?
In the NNFX (No Nonsense Forex) trading system, ATR (Average True Range) is typically used to measure the volatility of an asset. It is used as a part of the system to help determine the appropriate stop loss and take profit levels for a trade. ATR is calculated by taking the average of the true range values over a specified period.
True range is calculated as the maximum of the following values:
-Current high minus the current low
-Absolute value of the current high minus the previous close
-Absolute value of the current low minus the previous close
ATR is a dynamic indicator that changes with changes in volatility. As volatility increases, the value of ATR increases, and as volatility decreases, the value of ATR decreases. By using ATR in NNFX system, traders can adjust their stop loss and take profit levels according to the volatility of the asset being traded. This helps to ensure that the trade is given enough room to move, while also minimizing potential losses.
Other types of volatility include True Range Double (TRD), Close-to-Close, and Garman-Klass
What is a Baseline indicator?
The baseline is essentially a moving average, and is used to determine the overall direction of the market.
The baseline in the NNFX system is used to filter out trades that are not in line with the long-term trend of the market. The baseline is plotted on the chart along with other indicators, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR).
Trades are only taken when the price is in the same direction as the baseline. For example, if the baseline is sloping upwards, only long trades are taken, and if the baseline is sloping downwards, only short trades are taken. This approach helps to ensure that trades are in line with the overall trend of the market, and reduces the risk of entering trades that are likely to fail.
By using a baseline in the NNFX system, traders can have a clear reference point for determining the overall trend of the market, and can make more informed trading decisions. The baseline helps to filter out noise and false signals, and ensures that trades are taken in the direction of the long-term trend.
What is a Confirmation indicator?
Confirmation indicators are technical indicators that are used to confirm the signals generated by primary indicators. Primary indicators are the core indicators used in the NNFX system, such as the Average True Range (ATR), the Moving Average (MA), and the Relative Strength Index (RSI).
The purpose of the confirmation indicators is to reduce false signals and improve the accuracy of the trading system. They are designed to confirm the signals generated by the primary indicators by providing additional information about the strength and direction of the trend.
Some examples of confirmation indicators that may be used in the NNFX system include the Bollinger Bands, the MACD (Moving Average Convergence Divergence), and the MACD Oscillator. These indicators can provide information about the volatility, momentum, and trend strength of the market, and can be used to confirm the signals generated by the primary indicators.
In the NNFX system, confirmation indicators are used in combination with primary indicators and other filters to create a trading system that is robust and reliable. By using multiple indicators to confirm trading signals, the system aims to reduce the risk of false signals and improve the overall profitability of the trades.
What is a Continuation indicator?
In the NNFX (No Nonsense Forex) trading system, a continuation indicator is a technical indicator that is used to confirm a current trend and predict that the trend is likely to continue in the same direction. A continuation indicator is typically used in conjunction with other indicators in the system, such as a baseline indicator, to provide a comprehensive trading strategy.
What is a Volatility/Volume indicator?
Volume indicators, such as the On Balance Volume (OBV), the Chaikin Money Flow (CMF), or the Volume Price Trend (VPT), are used to measure the amount of buying and selling activity in a market. They are based on the trading volume of the market, and can provide information about the strength of the trend. In the NNFX system, volume indicators are used to confirm trading signals generated by the Moving Average and the Relative Strength Index. Volatility indicators include Average Direction Index, Waddah Attar, and Volatility Ratio. In the NNFX trading system, volatility is a proxy for volume and vice versa.
By using volume indicators as confirmation tools, the NNFX trading system aims to reduce the risk of false signals and improve the overall profitability of trades. These indicators can provide additional information about the market that is not captured by the primary indicators, and can help traders to make more informed trading decisions. In addition, volume indicators can be used to identify potential changes in market trends and to confirm the strength of price movements.
What is an Exit indicator?
The exit indicator is used in conjunction with other indicators in the system, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR), to provide a comprehensive trading strategy.
The exit indicator in the NNFX system can be any technical indicator that is deemed effective at identifying optimal exit points. Examples of exit indicators that are commonly used include the Parabolic SAR, the Average Directional Index (ADX), and the Chandelier Exit.
The purpose of the exit indicator is to identify when a trend is likely to reverse or when the market conditions have changed, signaling the need to exit a trade. By using an exit indicator, traders can manage their risk and prevent significant losses.
In the NNFX system, the exit indicator is used in conjunction with a stop loss and a take profit order to maximize profits and minimize losses. The stop loss order is used to limit the amount of loss that can be incurred if the trade goes against the trader, while the take profit order is used to lock in profits when the trade is moving in the trader's favor.
Overall, the use of an exit indicator in the NNFX trading system is an important component of a comprehensive trading strategy. It allows traders to manage their risk effectively and improve the profitability of their trades by exiting at the right time.
How does Loxx's GKD (Giga Kaleidoscope Modularized Trading System) implement the NNFX algorithm outlined above?
Loxx's GKD v1.0 system has five types of modules (indicators/strategies). These modules are:
1. GKD-BT - Backtesting module (Volatility, Number 1 in the NNFX algorithm)
2. GKD-B - Baseline module (Baseline and Volatility/Volume, Numbers 1 and 2 in the NNFX algorithm)
3. GKD-C - Confirmation 1/2 and Continuation module (Confirmation 1/2 and Continuation, Numbers 3, 4, and 5 in the NNFX algorithm)
4. GKD-V - Volatility/Volume module (Confirmation 1/2, Number 6 in the NNFX algorithm)
5. GKD-E - Exit module (Exit, Number 7 in the NNFX algorithm)
(additional module types will added in future releases)
Each module interacts with every module by passing data between modules. Data is passed between each module as described below:
GKD-B => GKD-V => GKD-C(1) => GKD-C(2) => GKD-C(Continuation) => GKD-E => GKD-BT
That is, the Baseline indicator passes its data to Volatility/Volume. The Volatility/Volume indicator passes its values to the Confirmation 1 indicator. The Confirmation 1 indicator passes its values to the Confirmation 2 indicator. The Confirmation 2 indicator passes its values to the Continuation indicator. The Continuation indicator passes its values to the Exit indicator, and finally, the Exit indicator passes its values to the Backtest strategy.
This chaining of indicators requires that each module conform to Loxx's GKD protocol, therefore allowing for the testing of every possible combination of technical indicators that make up the six components of the NNFX algorithm.
What does the application of the GKD trading system look like?
Example trading system:
Backtest: Strategy with 1-3 take profits, trailing stop loss, multiple types of PnL volatility, and 2 backtesting styles
Baseline: Hull Moving Average
Volatility/Volume: Hurst Exponent
Confirmation 1: Blau Candlestick Index as shown on the chart above
Confirmation 2: Williams Percent Range
Continuation: Fisher Transform
Exit: Rex Oscillator
Each GKD indicator is denoted with a module identifier of either: GKD-BT, GKD-B, GKD-C, GKD-V, or GKD-E. This allows traders to understand to which module each indicator belongs and where each indicator fits into the GKD protocol chain.
Giga Kaleidoscope Modularized Trading System Signals (based on the NNFX algorithm)
Standard Entry
1. GKD-C Confirmation 1 Signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
6. GKD-C Confirmation 1 signal was less than 7 candles prior
Continuation Entry
1. Standard Entry, Baseline Entry, or Pullback; entry triggered previously
2. GKD-B Baseline hasn't crossed since entry signal trigger
3. GKD-C Confirmation Continuation Indicator signals
4. GKD-C Confirmation 1 agrees
5. GKD-B Baseline agrees
6. GKD-C Confirmation 2 agrees
1-Candle Rule Standard Entry
1. GKD-C Confirmation 1 signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
1-Candle Rule Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 1 signal was less than 7 candles prior
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume Agrees
PullBack Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is beyond 1.0x Volatility of Baseline
Next Candle:
1. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume Agrees
█ GKD-C Blau Candlestick Index
What is Blau Candlestick Index?
The Blau Candlestick Index (CSI) is a technical analysis indicator developed by William Blau and described in his book “Momentum, Direction, and Divergence: Applying the Latest Momentum Indicators for Technical Analysis”. It is based on the Candlestick Momentum Indicator, which measures the difference between the current close price and the open price of a certain number of bars ago. The values of the CSI are normalized by the price range and mapped into the interval ³.
The CSI is calculated using the following formula:
CSI(price1,price2,q,r,s,u) = 100 * CMtm(price1,price2,q,r,s,u) / EMA(EMA(EMA(HH(q)-LL(q),r),s),u)
where:
- price1: close price
- price2: open price q bars ago
- q: number of bars used in calculation of Candlestick Momentum
- cmtm(price1,price2,q): Candlestick Momentum
- CMtm(price1,price2,q,r,s,u): Triple smoothed Candlestick Momentum
- LL(q): lowest price of the q bars
- HH(q): highest price of the q bars
- EMA(...,r): first smoothing - exponentially smoothed moving average with period r, applied to Candlestick Momentum and q-period Price Range
- EMA(EMA(...,r),s): second smoothing - EMA of period s, applied to result of the first smoothing
- EMA(EMA(EMA(...,r),s),u): third smoothing - EMA of period u, applied to result of the second smoothing ³.
The input parameters for this indicator are:
- q: number of bars used in calculation of Candlestick Momentum (default value is 1)
- r: period of the first EMA applied to Candlestick Momentum (default value is 20)
- s: period of the second EMA applied to result of the first smoothing (default value is 5)
- u: period of the third EMA applied to result of the second smoothing (default value is 3)
- AppliedPrice1: price type (default value is PRICE_CLOSE)
- AppliedPrice2: price type (default value is PRICE_OPEN) ³.
(1) Candlestick Index Blau_CSI - indicator for MetaTrader 5 - MQL5. www.mql5.com Accessed 4/6/2023.
(2) The Blau Candlestick Index trading indicator for MT5. www.fxtradingrevolution.com Accessed 4/6/2023.
(3) True Strength Index (TSI) - StockCharts.com. school.stockcharts.com Accessed 4/6/2023.
Requirements
Inputs
Confirmation 1 and Solo Confirmation: GKD-V Volatility / Volume indicator
Confirmation 2: GKD-C Confirmation indicator
Outputs
Confirmation 2 and Solo Confirmation Complex: GKD-E Exit indicator
Confirmation 1: GKD-C Confirmation indicator
Continuation: GKD-E Exit indicator
Solo Confirmation Simple: GKD-BT Backtest strategy
Additional features will be added in future releases.
GKD-C Blau Candlestick Momentum Indicator [Loxx]Giga Kaleidoscope GKD-C Blau Candlestick Momentum Indicator is a Confirmation module included in Loxx's "Giga Kaleidoscope Modularized Trading System".
█ Giga Kaleidoscope Modularized Trading System
What is Loxx's "Giga Kaleidoscope Modularized Trading System"?
The Giga Kaleidoscope Modularized Trading System is a trading system built on the philosophy of the NNFX (No Nonsense Forex) algorithmic trading.
What is the NNFX algorithmic trading strategy?
The NNFX (No-Nonsense Forex) trading system is a comprehensive approach to Forex trading that is designed to simplify the process and remove the confusion and complexity that often surrounds trading. The system was developed by a Forex trader who goes by the pseudonym "VP" and has gained a significant following in the Forex community.
The NNFX trading system is based on a set of rules and guidelines that help traders make objective and informed decisions. These rules cover all aspects of trading, including market analysis, trade entry, stop loss placement, and trade management.
Here are the main components of the NNFX trading system:
1. Trading Philosophy: The NNFX trading system is based on the idea that successful trading requires a comprehensive understanding of the market, objective analysis, and strict risk management. The system aims to remove subjective elements from trading and focuses on objective rules and guidelines.
2. Technical Analysis: The NNFX trading system relies heavily on technical analysis and uses a range of indicators to identify high-probability trading opportunities. The system uses a combination of trend-following and mean-reverting strategies to identify trades.
3. Market Structure: The NNFX trading system emphasizes the importance of understanding the market structure, including price action, support and resistance levels, and market cycles. The system uses a range of tools to identify the market structure, including trend lines, channels, and moving averages.
4. Trade Entry: The NNFX trading system has strict rules for trade entry. The system uses a combination of technical indicators to identify high-probability trades, and traders must meet specific criteria to enter a trade.
5. Stop Loss Placement: The NNFX trading system places a significant emphasis on risk management and requires traders to place a stop loss order on every trade. The system uses a combination of technical analysis and market structure to determine the appropriate stop loss level.
6. Trade Management: The NNFX trading system has specific rules for managing open trades. The system aims to minimize risk and maximize profit by using a combination of trailing stops, take profit levels, and position sizing.
Overall, the NNFX trading system is designed to be a straightforward and easy-to-follow approach to Forex trading that can be applied by traders of all skill levels.
Core components of an NNFX algorithmic trading strategy
The NNFX algorithm is built on the principles of trend, momentum, and volatility. There are six core components in the NNFX trading algorithm:
1. Volatility - price volatility; e.g., Average True Range, True Range Double, Close-to-Close, etc.
2. Baseline - a moving average to identify price trend
3. Confirmation 1 - a technical indicator used to identify trends
4. Confirmation 2 - a technical indicator used to identify trends
5. Continuation - a technical indicator used to identify trends
6. Volatility/Volume - a technical indicator used to identify volatility/volume breakouts/breakdown
7. Exit - a technical indicator used to determine when a trend is exhausted
What is Volatility in the NNFX trading system?
In the NNFX (No Nonsense Forex) trading system, ATR (Average True Range) is typically used to measure the volatility of an asset. It is used as a part of the system to help determine the appropriate stop loss and take profit levels for a trade. ATR is calculated by taking the average of the true range values over a specified period.
True range is calculated as the maximum of the following values:
-Current high minus the current low
-Absolute value of the current high minus the previous close
-Absolute value of the current low minus the previous close
ATR is a dynamic indicator that changes with changes in volatility. As volatility increases, the value of ATR increases, and as volatility decreases, the value of ATR decreases. By using ATR in NNFX system, traders can adjust their stop loss and take profit levels according to the volatility of the asset being traded. This helps to ensure that the trade is given enough room to move, while also minimizing potential losses.
Other types of volatility include True Range Double (TRD), Close-to-Close, and Garman-Klass
What is a Baseline indicator?
The baseline is essentially a moving average, and is used to determine the overall direction of the market.
The baseline in the NNFX system is used to filter out trades that are not in line with the long-term trend of the market. The baseline is plotted on the chart along with other indicators, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR).
Trades are only taken when the price is in the same direction as the baseline. For example, if the baseline is sloping upwards, only long trades are taken, and if the baseline is sloping downwards, only short trades are taken. This approach helps to ensure that trades are in line with the overall trend of the market, and reduces the risk of entering trades that are likely to fail.
By using a baseline in the NNFX system, traders can have a clear reference point for determining the overall trend of the market, and can make more informed trading decisions. The baseline helps to filter out noise and false signals, and ensures that trades are taken in the direction of the long-term trend.
What is a Confirmation indicator?
Confirmation indicators are technical indicators that are used to confirm the signals generated by primary indicators. Primary indicators are the core indicators used in the NNFX system, such as the Average True Range (ATR), the Moving Average (MA), and the Relative Strength Index (RSI).
The purpose of the confirmation indicators is to reduce false signals and improve the accuracy of the trading system. They are designed to confirm the signals generated by the primary indicators by providing additional information about the strength and direction of the trend.
Some examples of confirmation indicators that may be used in the NNFX system include the Bollinger Bands, the MACD (Moving Average Convergence Divergence), and the MACD Oscillator. These indicators can provide information about the volatility, momentum, and trend strength of the market, and can be used to confirm the signals generated by the primary indicators.
In the NNFX system, confirmation indicators are used in combination with primary indicators and other filters to create a trading system that is robust and reliable. By using multiple indicators to confirm trading signals, the system aims to reduce the risk of false signals and improve the overall profitability of the trades.
What is a Continuation indicator?
In the NNFX (No Nonsense Forex) trading system, a continuation indicator is a technical indicator that is used to confirm a current trend and predict that the trend is likely to continue in the same direction. A continuation indicator is typically used in conjunction with other indicators in the system, such as a baseline indicator, to provide a comprehensive trading strategy.
What is a Volatility/Volume indicator?
Volume indicators, such as the On Balance Volume (OBV), the Chaikin Money Flow (CMF), or the Volume Price Trend (VPT), are used to measure the amount of buying and selling activity in a market. They are based on the trading volume of the market, and can provide information about the strength of the trend. In the NNFX system, volume indicators are used to confirm trading signals generated by the Moving Average and the Relative Strength Index. Volatility indicators include Average Direction Index, Waddah Attar, and Volatility Ratio. In the NNFX trading system, volatility is a proxy for volume and vice versa.
By using volume indicators as confirmation tools, the NNFX trading system aims to reduce the risk of false signals and improve the overall profitability of trades. These indicators can provide additional information about the market that is not captured by the primary indicators, and can help traders to make more informed trading decisions. In addition, volume indicators can be used to identify potential changes in market trends and to confirm the strength of price movements.
What is an Exit indicator?
The exit indicator is used in conjunction with other indicators in the system, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR), to provide a comprehensive trading strategy.
The exit indicator in the NNFX system can be any technical indicator that is deemed effective at identifying optimal exit points. Examples of exit indicators that are commonly used include the Parabolic SAR, the Average Directional Index (ADX), and the Chandelier Exit.
The purpose of the exit indicator is to identify when a trend is likely to reverse or when the market conditions have changed, signaling the need to exit a trade. By using an exit indicator, traders can manage their risk and prevent significant losses.
In the NNFX system, the exit indicator is used in conjunction with a stop loss and a take profit order to maximize profits and minimize losses. The stop loss order is used to limit the amount of loss that can be incurred if the trade goes against the trader, while the take profit order is used to lock in profits when the trade is moving in the trader's favor.
Overall, the use of an exit indicator in the NNFX trading system is an important component of a comprehensive trading strategy. It allows traders to manage their risk effectively and improve the profitability of their trades by exiting at the right time.
How does Loxx's GKD (Giga Kaleidoscope Modularized Trading System) implement the NNFX algorithm outlined above?
Loxx's GKD v1.0 system has five types of modules (indicators/strategies). These modules are:
1. GKD-BT - Backtesting module (Volatility, Number 1 in the NNFX algorithm)
2. GKD-B - Baseline module (Baseline and Volatility/Volume, Numbers 1 and 2 in the NNFX algorithm)
3. GKD-C - Confirmation 1/2 and Continuation module (Confirmation 1/2 and Continuation, Numbers 3, 4, and 5 in the NNFX algorithm)
4. GKD-V - Volatility/Volume module (Confirmation 1/2, Number 6 in the NNFX algorithm)
5. GKD-E - Exit module (Exit, Number 7 in the NNFX algorithm)
(additional module types will added in future releases)
Each module interacts with every module by passing data between modules. Data is passed between each module as described below:
GKD-B => GKD-V => GKD-C(1) => GKD-C(2) => GKD-C(Continuation) => GKD-E => GKD-BT
That is, the Baseline indicator passes its data to Volatility/Volume. The Volatility/Volume indicator passes its values to the Confirmation 1 indicator. The Confirmation 1 indicator passes its values to the Confirmation 2 indicator. The Confirmation 2 indicator passes its values to the Continuation indicator. The Continuation indicator passes its values to the Exit indicator, and finally, the Exit indicator passes its values to the Backtest strategy.
This chaining of indicators requires that each module conform to Loxx's GKD protocol, therefore allowing for the testing of every possible combination of technical indicators that make up the six components of the NNFX algorithm.
What does the application of the GKD trading system look like?
Example trading system:
Backtest: Strategy with 1-3 take profits, trailing stop loss, multiple types of PnL volatility, and 2 backtesting styles
Baseline: Hull Moving Average
Volatility/Volume: Hurst Exponent
Confirmation 1: Blau Candlestick Momentum Indicator as shown on the chart above
Confirmation 2: Williams Percent Range
Continuation: Fisher Transform
Exit: Rex Oscillator
Each GKD indicator is denoted with a module identifier of either: GKD-BT, GKD-B, GKD-C, GKD-V, or GKD-E. This allows traders to understand to which module each indicator belongs and where each indicator fits into the GKD protocol chain.
Giga Kaleidoscope Modularized Trading System Signals (based on the NNFX algorithm)
Standard Entry
1. GKD-C Confirmation 1 Signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
6. GKD-C Confirmation 1 signal was less than 7 candles prior
Continuation Entry
1. Standard Entry, Baseline Entry, or Pullback; entry triggered previously
2. GKD-B Baseline hasn't crossed since entry signal trigger
3. GKD-C Confirmation Continuation Indicator signals
4. GKD-C Confirmation 1 agrees
5. GKD-B Baseline agrees
6. GKD-C Confirmation 2 agrees
1-Candle Rule Standard Entry
1. GKD-C Confirmation 1 signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
1-Candle Rule Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 1 signal was less than 7 candles prior
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume Agrees
PullBack Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is beyond 1.0x Volatility of Baseline
Next Candle:
1. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume Agrees
█ GKD-C Blau Candlestick Momentum Indicator
What is Blau Candlestick Momentum Indicator?
The Candlestick Momentum Indicator is a technical analysis indicator developed by William Blau and described in his book “Momentum, Direction, and Divergence: Applying the Latest Momentum Indicators for Technical Analysis”. It measures the difference between the current close price and the open price of a certain number of bars ago. The values of the Candlestick Momentum Indicator are normalized by absolute values and mapped into the interval .
The Candlestick Momentum Indicator is calculated using the following formula:
CMtm(price1,price2,q,r,s,u) = 100 * EMA(EMA(EMA(cmtm(price1,price2,q),r),s),u)
where:
- price1: close price
- price2: open price q bars ago
- q: number of bars used in calculation of Candlestick Momentum
- cmtm(price1,price2,q): Candlestick Momentum
- CMtm(price1,price2,q,r,s,u): Triple smoothed Candlestick Momentum
- EMA(...,r): first smoothing - exponentially smoothed moving average with period r, applied to Candlestick Momentum
- EMA(EMA(...,r),s): second smoothing - EMA of period s, applied to result of the first smoothing
- EMA(EMA(EMA(...,r),s),u): third smoothing - EMA of period u, applied to result of the second smoothing .
The input parameters for this indicator are:
- q: number of bars used in calculation of Candlestick Momentum (default value is 1)
- r: period of the first EMA applied to Candlestick Momentum (default value is 20)
- s: period of the second EMA applied to result of the first smoothing (default value is 5)
- u: period of the third EMA applied to result of the second smoothing (default value is 3)
- AppliedPrice1: price type (default value is PRICE_CLOSE)
- AppliedPrice2: price type (default value is PRICE_OPEN) .
Requirements
Inputs
Confirmation 1 and Solo Confirmation: GKD-V Volatility / Volume indicator
Confirmation 2: GKD-C Confirmation indicator
Outputs
Confirmation 2 and Solo Confirmation Complex: GKD-E Exit indicator
Confirmation 1: GKD-C Confirmation indicator
Continuation: GKD-E Exit indicator
Solo Confirmation Simple: GKD-BT Backtest strategy
Additional features will be added in future releases.
GKD-C Blau Candlestick Momentum Index [Loxx]Giga Kaleidoscope GKD-C Blau Candlestick Momentum Index is a Confirmation module included in Loxx's "Giga Kaleidoscope Modularized Trading System".
█ Giga Kaleidoscope Modularized Trading System
What is Loxx's "Giga Kaleidoscope Modularized Trading System"?
The Giga Kaleidoscope Modularized Trading System is a trading system built on the philosophy of the NNFX (No Nonsense Forex) algorithmic trading.
What is the NNFX algorithmic trading strategy?
The NNFX (No-Nonsense Forex) trading system is a comprehensive approach to Forex trading that is designed to simplify the process and remove the confusion and complexity that often surrounds trading. The system was developed by a Forex trader who goes by the pseudonym "VP" and has gained a significant following in the Forex community.
The NNFX trading system is based on a set of rules and guidelines that help traders make objective and informed decisions. These rules cover all aspects of trading, including market analysis, trade entry, stop loss placement, and trade management.
Here are the main components of the NNFX trading system:
1. Trading Philosophy: The NNFX trading system is based on the idea that successful trading requires a comprehensive understanding of the market, objective analysis, and strict risk management. The system aims to remove subjective elements from trading and focuses on objective rules and guidelines.
2. Technical Analysis: The NNFX trading system relies heavily on technical analysis and uses a range of indicators to identify high-probability trading opportunities. The system uses a combination of trend-following and mean-reverting strategies to identify trades.
3. Market Structure: The NNFX trading system emphasizes the importance of understanding the market structure, including price action, support and resistance levels, and market cycles. The system uses a range of tools to identify the market structure, including trend lines, channels, and moving averages.
4. Trade Entry: The NNFX trading system has strict rules for trade entry. The system uses a combination of technical indicators to identify high-probability trades, and traders must meet specific criteria to enter a trade.
5. Stop Loss Placement: The NNFX trading system places a significant emphasis on risk management and requires traders to place a stop loss order on every trade. The system uses a combination of technical analysis and market structure to determine the appropriate stop loss level.
6. Trade Management: The NNFX trading system has specific rules for managing open trades. The system aims to minimize risk and maximize profit by using a combination of trailing stops, take profit levels, and position sizing.
Overall, the NNFX trading system is designed to be a straightforward and easy-to-follow approach to Forex trading that can be applied by traders of all skill levels.
Core components of an NNFX algorithmic trading strategy
The NNFX algorithm is built on the principles of trend, momentum, and volatility. There are six core components in the NNFX trading algorithm:
1. Volatility - price volatility; e.g., Average True Range, True Range Double, Close-to-Close, etc.
2. Baseline - a moving average to identify price trend
3. Confirmation 1 - a technical indicator used to identify trends
4. Confirmation 2 - a technical indicator used to identify trends
5. Continuation - a technical indicator used to identify trends
6. Volatility/Volume - a technical indicator used to identify volatility/volume breakouts/breakdown
7. Exit - a technical indicator used to determine when a trend is exhausted
What is Volatility in the NNFX trading system?
In the NNFX (No Nonsense Forex) trading system, ATR (Average True Range) is typically used to measure the volatility of an asset. It is used as a part of the system to help determine the appropriate stop loss and take profit levels for a trade. ATR is calculated by taking the average of the true range values over a specified period.
True range is calculated as the maximum of the following values:
-Current high minus the current low
-Absolute value of the current high minus the previous close
-Absolute value of the current low minus the previous close
ATR is a dynamic indicator that changes with changes in volatility. As volatility increases, the value of ATR increases, and as volatility decreases, the value of ATR decreases. By using ATR in NNFX system, traders can adjust their stop loss and take profit levels according to the volatility of the asset being traded. This helps to ensure that the trade is given enough room to move, while also minimizing potential losses.
Other types of volatility include True Range Double (TRD), Close-to-Close, and Garman-Klass
What is a Baseline indicator?
The baseline is essentially a moving average, and is used to determine the overall direction of the market.
The baseline in the NNFX system is used to filter out trades that are not in line with the long-term trend of the market. The baseline is plotted on the chart along with other indicators, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR).
Trades are only taken when the price is in the same direction as the baseline. For example, if the baseline is sloping upwards, only long trades are taken, and if the baseline is sloping downwards, only short trades are taken. This approach helps to ensure that trades are in line with the overall trend of the market, and reduces the risk of entering trades that are likely to fail.
By using a baseline in the NNFX system, traders can have a clear reference point for determining the overall trend of the market, and can make more informed trading decisions. The baseline helps to filter out noise and false signals, and ensures that trades are taken in the direction of the long-term trend.
What is a Confirmation indicator?
Confirmation indicators are technical indicators that are used to confirm the signals generated by primary indicators. Primary indicators are the core indicators used in the NNFX system, such as the Average True Range (ATR), the Moving Average (MA), and the Relative Strength Index (RSI).
The purpose of the confirmation indicators is to reduce false signals and improve the accuracy of the trading system. They are designed to confirm the signals generated by the primary indicators by providing additional information about the strength and direction of the trend.
Some examples of confirmation indicators that may be used in the NNFX system include the Bollinger Bands, the MACD (Moving Average Convergence Divergence), and the MACD Oscillator. These indicators can provide information about the volatility, momentum, and trend strength of the market, and can be used to confirm the signals generated by the primary indicators.
In the NNFX system, confirmation indicators are used in combination with primary indicators and other filters to create a trading system that is robust and reliable. By using multiple indicators to confirm trading signals, the system aims to reduce the risk of false signals and improve the overall profitability of the trades.
What is a Continuation indicator?
In the NNFX (No Nonsense Forex) trading system, a continuation indicator is a technical indicator that is used to confirm a current trend and predict that the trend is likely to continue in the same direction. A continuation indicator is typically used in conjunction with other indicators in the system, such as a baseline indicator, to provide a comprehensive trading strategy.
What is a Volatility/Volume indicator?
Volume indicators, such as the On Balance Volume (OBV), the Chaikin Money Flow (CMF), or the Volume Price Trend (VPT), are used to measure the amount of buying and selling activity in a market. They are based on the trading volume of the market, and can provide information about the strength of the trend. In the NNFX system, volume indicators are used to confirm trading signals generated by the Moving Average and the Relative Strength Index. Volatility indicators include Average Direction Index, Waddah Attar, and Volatility Ratio. In the NNFX trading system, volatility is a proxy for volume and vice versa.
By using volume indicators as confirmation tools, the NNFX trading system aims to reduce the risk of false signals and improve the overall profitability of trades. These indicators can provide additional information about the market that is not captured by the primary indicators, and can help traders to make more informed trading decisions. In addition, volume indicators can be used to identify potential changes in market trends and to confirm the strength of price movements.
What is an Exit indicator?
The exit indicator is used in conjunction with other indicators in the system, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR), to provide a comprehensive trading strategy.
The exit indicator in the NNFX system can be any technical indicator that is deemed effective at identifying optimal exit points. Examples of exit indicators that are commonly used include the Parabolic SAR, the Average Directional Index (ADX), and the Chandelier Exit.
The purpose of the exit indicator is to identify when a trend is likely to reverse or when the market conditions have changed, signaling the need to exit a trade. By using an exit indicator, traders can manage their risk and prevent significant losses.
In the NNFX system, the exit indicator is used in conjunction with a stop loss and a take profit order to maximize profits and minimize losses. The stop loss order is used to limit the amount of loss that can be incurred if the trade goes against the trader, while the take profit order is used to lock in profits when the trade is moving in the trader's favor.
Overall, the use of an exit indicator in the NNFX trading system is an important component of a comprehensive trading strategy. It allows traders to manage their risk effectively and improve the profitability of their trades by exiting at the right time.
How does Loxx's GKD (Giga Kaleidoscope Modularized Trading System) implement the NNFX algorithm outlined above?
Loxx's GKD v1.0 system has five types of modules (indicators/strategies). These modules are:
1. GKD-BT - Backtesting module (Volatility, Number 1 in the NNFX algorithm)
2. GKD-B - Baseline module (Baseline and Volatility/Volume, Numbers 1 and 2 in the NNFX algorithm)
3. GKD-C - Confirmation 1/2 and Continuation module (Confirmation 1/2 and Continuation, Numbers 3, 4, and 5 in the NNFX algorithm)
4. GKD-V - Volatility/Volume module (Confirmation 1/2, Number 6 in the NNFX algorithm)
5. GKD-E - Exit module (Exit, Number 7 in the NNFX algorithm)
(additional module types will added in future releases)
Each module interacts with every module by passing data between modules. Data is passed between each module as described below:
GKD-B => GKD-V => GKD-C(1) => GKD-C(2) => GKD-C(Continuation) => GKD-E => GKD-BT
That is, the Baseline indicator passes its data to Volatility/Volume. The Volatility/Volume indicator passes its values to the Confirmation 1 indicator. The Confirmation 1 indicator passes its values to the Confirmation 2 indicator. The Confirmation 2 indicator passes its values to the Continuation indicator. The Continuation indicator passes its values to the Exit indicator, and finally, the Exit indicator passes its values to the Backtest strategy.
This chaining of indicators requires that each module conform to Loxx's GKD protocol, therefore allowing for the testing of every possible combination of technical indicators that make up the six components of the NNFX algorithm.
What does the application of the GKD trading system look like?
Example trading system:
Backtest: Strategy with 1-3 take profits, trailing stop loss, multiple types of PnL volatility, and 2 backtesting styles
Baseline: Hull Moving Average
Volatility/Volume: Hurst Exponent
Confirmation 1: Blau Candlestick Momentum Index as shown on the chart above
Confirmation 2: Williams Percent Range
Continuation: Fisher Transform
Exit: Rex Oscillator
Each GKD indicator is denoted with a module identifier of either: GKD-BT, GKD-B, GKD-C, GKD-V, or GKD-E. This allows traders to understand to which module each indicator belongs and where each indicator fits into the GKD protocol chain.
Giga Kaleidoscope Modularized Trading System Signals (based on the NNFX algorithm)
Standard Entry
1. GKD-C Confirmation 1 Signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
6. GKD-C Confirmation 1 signal was less than 7 candles prior
Continuation Entry
1. Standard Entry, Baseline Entry, or Pullback; entry triggered previously
2. GKD-B Baseline hasn't crossed since entry signal trigger
3. GKD-C Confirmation Continuation Indicator signals
4. GKD-C Confirmation 1 agrees
5. GKD-B Baseline agrees
6. GKD-C Confirmation 2 agrees
1-Candle Rule Standard Entry
1. GKD-C Confirmation 1 signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
1-Candle Rule Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 1 signal was less than 7 candles prior
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume Agrees
PullBack Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is beyond 1.0x Volatility of Baseline
Next Candle:
1. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume Agrees
█ GKD-C Blau Candlestick Momentum Index
What is Blau Candlestick Momentum Index?
The Blau Candlestick Momentum Index (CMI) is a technical analysis indicator developed by William Blau and described in his book “Momentum, Direction, and Divergence: Applying the Latest Momentum Indicators for Technical Analysis”. It is based on the Candlestick Momentum Indicator, which measures the difference between the current close price and the open price of a certain number of bars ago. The values of the CMI are normalized by the price range and mapped into the interval.
The CMI is calculated using the following formula:
CMI(price1,price2,q,r,s,u) = 100 * CMtm(price1,price2,q,r,s,u) / EMA(EMA(EMA(|cmtm(price1,price2,q)|,r),s),u)
where:
- price1: close price
- price2: open price q bars ago
- q: number of bars used in calculation of Candlestick Momentum
- cmtm(price1,price2,q): Candlestick Momentum
- CMtm(price1,price2,q,r,s,u): Triple smoothed Candlestick Momentum
- EMA(...,r): first smoothing - exponentially smoothed moving average with period r, applied to Candlestick Momentum and absolute value of Candlestick Momentum
- EMA(EMA(...,r),s): second smoothing - EMA of period s, applied to result of the first smoothing
- EMA(EMA(EMA(...,r),s),u): third smoothing - EMA of period u, applied to result of the second smoothing ³.
The input parameters for this indicator are:
- q: number of bars used in calculation of Candlestick Momentum (default value is 1)
- r: period of the first EMA applied to Candlestick Momentum (default value is 20)
- s: period of the second EMA applied to result of the first smoothing (default value is 5)
- u: period of the third EMA applied to result of the second smoothing (default value is 3)
- AppliedPrice1: price type (default value is PRICE_CLOSE)
- AppliedPrice2: price type (default value is PRICE_OPEN) ³.
(2) www.mql5.com ]Candlestick Momentum Index Blau_CMI - indicator for MetaTrader 5 - MQL5. Accessed 4/6/2023.
(3) True Strength Index (TSI) - StockCharts.com. school.stockcharts.com Accessed 4/6/2023.
(4) Candlestick Momentum Index Blau_CMI – indicator for MetaTrader 5. www.forexmt4indicators.com Accessed 4/6/2023.
(5) Candlestick Index Blau_CSI – indicator for MetaTrader 5. Accessed 4/6/2023.
Requirements
Inputs
Confirmation 1 and Solo Confirmation: GKD-V Volatility / Volume indicator
Confirmation 2: GKD-C Confirmation indicator
Outputs
Confirmation 2 and Solo Confirmation Complex: GKD-E Exit indicator
Confirmation 1: GKD-C Confirmation indicator
Continuation: GKD-E Exit indicator
Solo Confirmation Simple: GKD-BT Backtest strategy
Additional features will be added in future releases.
GKD-C Blau Stochastic Momentum Index [Loxx]Giga Kaleidoscope GKD-C Blau Stochastic Momentum Index is a Confirmation module included in Loxx's "Giga Kaleidoscope Modularized Trading System".
█ Giga Kaleidoscope Modularized Trading System
What is Loxx's "Giga Kaleidoscope Modularized Trading System"?
The Giga Kaleidoscope Modularized Trading System is a trading system built on the philosophy of the NNFX (No Nonsense Forex) algorithmic trading.
What is the NNFX algorithmic trading strategy?
The NNFX (No-Nonsense Forex) trading system is a comprehensive approach to Forex trading that is designed to simplify the process and remove the confusion and complexity that often surrounds trading. The system was developed by a Forex trader who goes by the pseudonym "VP" and has gained a significant following in the Forex community.
The NNFX trading system is based on a set of rules and guidelines that help traders make objective and informed decisions. These rules cover all aspects of trading, including market analysis, trade entry, stop loss placement, and trade management.
Here are the main components of the NNFX trading system:
1. Trading Philosophy: The NNFX trading system is based on the idea that successful trading requires a comprehensive understanding of the market, objective analysis, and strict risk management. The system aims to remove subjective elements from trading and focuses on objective rules and guidelines.
2. Technical Analysis: The NNFX trading system relies heavily on technical analysis and uses a range of indicators to identify high-probability trading opportunities. The system uses a combination of trend-following and mean-reverting strategies to identify trades.
3. Market Structure: The NNFX trading system emphasizes the importance of understanding the market structure, including price action, support and resistance levels, and market cycles. The system uses a range of tools to identify the market structure, including trend lines, channels, and moving averages.
4. Trade Entry: The NNFX trading system has strict rules for trade entry. The system uses a combination of technical indicators to identify high-probability trades, and traders must meet specific criteria to enter a trade.
5. Stop Loss Placement: The NNFX trading system places a significant emphasis on risk management and requires traders to place a stop loss order on every trade. The system uses a combination of technical analysis and market structure to determine the appropriate stop loss level.
6. Trade Management: The NNFX trading system has specific rules for managing open trades. The system aims to minimize risk and maximize profit by using a combination of trailing stops, take profit levels, and position sizing.
Overall, the NNFX trading system is designed to be a straightforward and easy-to-follow approach to Forex trading that can be applied by traders of all skill levels.
Core components of an NNFX algorithmic trading strategy
The NNFX algorithm is built on the principles of trend, momentum, and volatility. There are six core components in the NNFX trading algorithm:
1. Volatility - price volatility; e.g., Average True Range, True Range Double, Close-to-Close, etc.
2. Baseline - a moving average to identify price trend
3. Confirmation 1 - a technical indicator used to identify trends
4. Confirmation 2 - a technical indicator used to identify trends
5. Continuation - a technical indicator used to identify trends
6. Volatility/Volume - a technical indicator used to identify volatility/volume breakouts/breakdown
7. Exit - a technical indicator used to determine when a trend is exhausted
What is Volatility in the NNFX trading system?
In the NNFX (No Nonsense Forex) trading system, ATR (Average True Range) is typically used to measure the volatility of an asset. It is used as a part of the system to help determine the appropriate stop loss and take profit levels for a trade. ATR is calculated by taking the average of the true range values over a specified period.
True range is calculated as the maximum of the following values:
-Current high minus the current low
-Absolute value of the current high minus the previous close
-Absolute value of the current low minus the previous close
ATR is a dynamic indicator that changes with changes in volatility. As volatility increases, the value of ATR increases, and as volatility decreases, the value of ATR decreases. By using ATR in NNFX system, traders can adjust their stop loss and take profit levels according to the volatility of the asset being traded. This helps to ensure that the trade is given enough room to move, while also minimizing potential losses.
Other types of volatility include True Range Double (TRD), Close-to-Close, and Garman-Klass
What is a Baseline indicator?
The baseline is essentially a moving average, and is used to determine the overall direction of the market.
The baseline in the NNFX system is used to filter out trades that are not in line with the long-term trend of the market. The baseline is plotted on the chart along with other indicators, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR).
Trades are only taken when the price is in the same direction as the baseline. For example, if the baseline is sloping upwards, only long trades are taken, and if the baseline is sloping downwards, only short trades are taken. This approach helps to ensure that trades are in line with the overall trend of the market, and reduces the risk of entering trades that are likely to fail.
By using a baseline in the NNFX system, traders can have a clear reference point for determining the overall trend of the market, and can make more informed trading decisions. The baseline helps to filter out noise and false signals, and ensures that trades are taken in the direction of the long-term trend.
What is a Confirmation indicator?
Confirmation indicators are technical indicators that are used to confirm the signals generated by primary indicators. Primary indicators are the core indicators used in the NNFX system, such as the Average True Range (ATR), the Moving Average (MA), and the Relative Strength Index (RSI).
The purpose of the confirmation indicators is to reduce false signals and improve the accuracy of the trading system. They are designed to confirm the signals generated by the primary indicators by providing additional information about the strength and direction of the trend.
Some examples of confirmation indicators that may be used in the NNFX system include the Bollinger Bands, the MACD (Moving Average Convergence Divergence), and the MACD Oscillator. These indicators can provide information about the volatility, momentum, and trend strength of the market, and can be used to confirm the signals generated by the primary indicators.
In the NNFX system, confirmation indicators are used in combination with primary indicators and other filters to create a trading system that is robust and reliable. By using multiple indicators to confirm trading signals, the system aims to reduce the risk of false signals and improve the overall profitability of the trades.
What is a Continuation indicator?
In the NNFX (No Nonsense Forex) trading system, a continuation indicator is a technical indicator that is used to confirm a current trend and predict that the trend is likely to continue in the same direction. A continuation indicator is typically used in conjunction with other indicators in the system, such as a baseline indicator, to provide a comprehensive trading strategy.
What is a Volatility/Volume indicator?
Volume indicators, such as the On Balance Volume (OBV), the Chaikin Money Flow (CMF), or the Volume Price Trend (VPT), are used to measure the amount of buying and selling activity in a market. They are based on the trading volume of the market, and can provide information about the strength of the trend. In the NNFX system, volume indicators are used to confirm trading signals generated by the Moving Average and the Relative Strength Index. Volatility indicators include Average Direction Index, Waddah Attar, and Volatility Ratio. In the NNFX trading system, volatility is a proxy for volume and vice versa.
By using volume indicators as confirmation tools, the NNFX trading system aims to reduce the risk of false signals and improve the overall profitability of trades. These indicators can provide additional information about the market that is not captured by the primary indicators, and can help traders to make more informed trading decisions. In addition, volume indicators can be used to identify potential changes in market trends and to confirm the strength of price movements.
What is an Exit indicator?
The exit indicator is used in conjunction with other indicators in the system, such as the Moving Average (MA), the Relative Strength Index (RSI), and the Average True Range (ATR), to provide a comprehensive trading strategy.
The exit indicator in the NNFX system can be any technical indicator that is deemed effective at identifying optimal exit points. Examples of exit indicators that are commonly used include the Parabolic SAR, the Average Directional Index (ADX), and the Chandelier Exit.
The purpose of the exit indicator is to identify when a trend is likely to reverse or when the market conditions have changed, signaling the need to exit a trade. By using an exit indicator, traders can manage their risk and prevent significant losses.
In the NNFX system, the exit indicator is used in conjunction with a stop loss and a take profit order to maximize profits and minimize losses. The stop loss order is used to limit the amount of loss that can be incurred if the trade goes against the trader, while the take profit order is used to lock in profits when the trade is moving in the trader's favor.
Overall, the use of an exit indicator in the NNFX trading system is an important component of a comprehensive trading strategy. It allows traders to manage their risk effectively and improve the profitability of their trades by exiting at the right time.
How does Loxx's GKD (Giga Kaleidoscope Modularized Trading System) implement the NNFX algorithm outlined above?
Loxx's GKD v1.0 system has five types of modules (indicators/strategies). These modules are:
1. GKD-BT - Backtesting module (Volatility, Number 1 in the NNFX algorithm)
2. GKD-B - Baseline module (Baseline and Volatility/Volume, Numbers 1 and 2 in the NNFX algorithm)
3. GKD-C - Confirmation 1/2 and Continuation module (Confirmation 1/2 and Continuation, Numbers 3, 4, and 5 in the NNFX algorithm)
4. GKD-V - Volatility/Volume module (Confirmation 1/2, Number 6 in the NNFX algorithm)
5. GKD-E - Exit module (Exit, Number 7 in the NNFX algorithm)
(additional module types will added in future releases)
Each module interacts with every module by passing data between modules. Data is passed between each module as described below:
GKD-B => GKD-V => GKD-C(1) => GKD-C(2) => GKD-C(Continuation) => GKD-E => GKD-BT
That is, the Baseline indicator passes its data to Volatility/Volume. The Volatility/Volume indicator passes its values to the Confirmation 1 indicator. The Confirmation 1 indicator passes its values to the Confirmation 2 indicator. The Confirmation 2 indicator passes its values to the Continuation indicator. The Continuation indicator passes its values to the Exit indicator, and finally, the Exit indicator passes its values to the Backtest strategy.
This chaining of indicators requires that each module conform to Loxx's GKD protocol, therefore allowing for the testing of every possible combination of technical indicators that make up the six components of the NNFX algorithm.
What does the application of the GKD trading system look like?
Example trading system:
Backtest: Strategy with 1-3 take profits, trailing stop loss, multiple types of PnL volatility, and 2 backtesting styles
Baseline: Hull Moving Average
Volatility/Volume: Hurst Exponent
Confirmation 1: Blau Stochastic Momentum Index as shown on the chart above
Confirmation 2: Williams Percent Range
Continuation: Fisher Transform
Exit: Rex Oscillator
Each GKD indicator is denoted with a module identifier of either: GKD-BT, GKD-B, GKD-C, GKD-V, or GKD-E. This allows traders to understand to which module each indicator belongs and where each indicator fits into the GKD protocol chain.
Giga Kaleidoscope Modularized Trading System Signals (based on the NNFX algorithm)
Standard Entry
1. GKD-C Confirmation 1 Signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
6. GKD-C Confirmation 1 signal was less than 7 candles prior
Continuation Entry
1. Standard Entry, Baseline Entry, or Pullback; entry triggered previously
2. GKD-B Baseline hasn't crossed since entry signal trigger
3. GKD-C Confirmation Continuation Indicator signals
4. GKD-C Confirmation 1 agrees
5. GKD-B Baseline agrees
6. GKD-C Confirmation 2 agrees
1-Candle Rule Standard Entry
1. GKD-C Confirmation 1 signal
2. GKD-B Baseline agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume agrees
1-Candle Rule Baseline Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
4. GKD-C Confirmation 1 signal was less than 7 candles prior
Next Candle:
1. Price retraced (Long: close < close or Short: close > close )
2. GKD-B Baseline agrees
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume Agrees
PullBack Entry
1. GKD-B Baseline signal
2. GKD-C Confirmation 1 agrees
3. Price is beyond 1.0x Volatility of Baseline
Next Candle:
1. Price is within a range of 0.2x Volatility and 1.0x Volatility of the Goldie Locks Mean
3. GKD-C Confirmation 1 agrees
4. GKD-C Confirmation 2 agrees
5. GKD-V Volatility/Volume Agrees
█ GKD-C Blau Stochastic Momentum Index
What is Blau Stochastic Momentum Index?
The Blau Stochastic Momentum Index (BSMI) is a technical analysis indicator used to measure momentum in financial markets. It was developed by William Blau, a well-known trader and author of several books on technical analysis.
The BSMI is based on the Stochastic Momentum Index (SMI), which is a popular momentum indicator that measures the distance between the current closing price and the recent high or low. The SMI is similar to the Stochastic Oscillator, but it takes into account the rate of change in the market, making it more responsive to short-term changes in momentum.
The BSMI is designed to provide a more accurate and responsive measure of momentum than the SMI. It uses a digital signal processing technique called "smoothed moving averages" to filter out noise and provide a smoother, more stable indicator. This technique helps to reduce false signals and provide a clearer picture of market momentum.
The BSMI indicator is plotted on a chart as a line that oscillates between -100 and +100. Values above zero indicate bullish momentum, while values below zero indicate bearish momentum. The BSMI line is typically plotted alongside the price chart to help traders identify potential turning points in the market.
Traders can use the BSMI indicator in a variety of ways, including:
1. Identifying overbought and oversold conditions: When the BSMI line reaches extreme values (e.g., above +80 or below -80), it may indicate that the market is overbought or oversold and due for a reversal.
2. Confirming trend strength: When the BSMI line is trending in the same direction as the price, it can confirm the strength of the trend and help traders stay in winning positions.
3. Identifying divergences: When the BSMI line and the price chart are moving in opposite directions, it may indicate a potential trend reversal or weakening of the current trend.
As with any technical indicator, it is important to use the BSMI in conjunction with other forms of analysis and risk management strategies. No single indicator can predict market movements with 100% accuracy, and traders should always use caution and discipline when making trading decisions.
Requirements
Inputs
Confirmation 1 and Solo Confirmation: GKD-V Volatility / Volume indicator
Confirmation 2: GKD-C Confirmation indicator
Outputs
Confirmation 2 and Solo Confirmation Complex: GKD-E Exit indicator
Confirmation 1: GKD-C Confirmation indicator
Continuation: GKD-E Exit indicator
Solo Confirmation Simple: GKD-BT Backtest strategy
Additional features will be added in future releases.
