Katalyst's Opening Range BreakoutKatalyst's Opening Range Breakout + No Trade Zone
📜 Overview:
This indicator allows traders to visualize the high and low of the opening range for a user-selected timeframe (e.g., 30s, 1m, 5m, 15m). It features fully customizable lines, labels, and an optional **No Trade Zone** fill to help you identify breakout levels with ease.
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🎯 Key Features:
1. **Customizable Opening Range**:
- Select your preferred opening range duration: **30 seconds, 1 minute, 2 minutes, 5 minutes, 10 minutes, or 15 minutes**.
- The indicator calculates and plots the **high** and **low** of the selected opening range.
2. **Dynamic Line Styling**:
- Choose the **line color**, **transparency**, and **style**: **Solid, Dashed, or Dotted**.
- Lines extend to the right of the chart for clarity.
3. **No Trade Zone** *(Optional / Disabled by default)*:
- When enabled, fills the area between the high and low lines with a customizable **color and transparency**.
- Helps visually identify consolidation areas where trading might be avoided.
4. **Labels for Precision**:
- Clearly displays the **Opening Range High** and **Low** values.
- Labels are color-coded and positioned dynamically for easy interpretation.
5. **Clean and Efficient Updates**:
- The indicator deletes old lines, labels, and fills before creating new ones, ensuring a clutter-free chart.
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⚙️ How to Use:
1. **Select Your Timeframe**:
- From the settings, choose your desired opening range duration: 30s, 1m, 2m, 5m, 10m, or 15m.
2. **Customize the Visuals**:
- Adjust line color, style, and transparency.
- Enable the **No Trade Zone** for a transparent background fill between the high and low lines.
3. **Interpret the Breakout**:
- Watch for price movements above or below the **opening range** to identify potential breakout opportunities.
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🛠 Settings:
Opening Range Duration: Select the timeframe for the opening range (30s, 1m, 2m, 5m, 10m, 15m).
Line Color: Set the color of the range lines.
Line Transparency: Adjust the transparency of the lines (0 = solid, 100 = invisible).
Line Style: Choose line style: Solid, Dashed, or Dotted.
Label Colors: Customize the label colors for the high and low values.
Enable No Trade Zone: Fill the area between high and low lines with a transparent color.
No Trade Zone Color: Set the fill color for the no trade zone.
No Trade Zone Transparency: Adjust the transparency of the no trade zone fill.
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📈 Ideal For
Day traders and scalpers looking to trade **breakouts**.
Traders who want to identify areas of consolidation visually.
Anyone who relies on the **opening range** for their trading strategy.
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🔍 Example Usage:
Set the opening range to **5 minutes** and enable the **No Trade Zone** with a light red fill.
Watch for price to break above or below the high/low lines to signal potential trade opportunities.
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✨ Why Use This Indicator?
This script simplifies your breakout strategy by providing a clear, visually appealing representation of the opening range. The flexible customization options and the optional **No Trade Zone** make it a powerful tool for identifying high-probability trades.
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Let me know if you need any additional tweaks or clarifications for this description. It's all set to help traders understand and use your powerful script! 🚀📈
Komut dosyalarını "high low" için ara
Ensemble Alerts█ OVERVIEW
This indicator creates highly customizable alert conditions and messages by combining several technical conditions into groups , which users can specify directly from the "Settings/Inputs" tab. It offers a flexible framework for building and testing complex alert conditions without requiring code modifications for each adjustment.
█ CONCEPTS
Ensemble analysis
Ensemble analysis is a form of data analysis that combines several "weaker" models to produce a potentially more robust model. In a trading context, one of the most prevalent forms of ensemble analysis is the aggregation (grouping) of several indicators to derive market insights and reinforce trading decisions. With this analysis, traders typically inspect multiple indicators, signaling trade actions when specific conditions or groups of conditions align.
Simplifying ensemble creation
Combining indicators into one or more ensembles can be challenging, especially for users without programming knowledge. It usually involves writing custom scripts to aggregate the indicators and trigger trading alerts based on the confluence of specific conditions. Making such scripts customizable via inputs poses an additional challenge, as it often involves complicated input menus and conditional logic.
This indicator addresses these challenges by providing a simple, flexible input menu where users can easily define alert criteria by listing groups of conditions from various technical indicators in simple text boxes . With this script, you can create complex alert conditions intuitively from the "Settings/Inputs" tab without ever writing or modifying a single line of code. This framework makes advanced alert setups more accessible to non-coders. Additionally, it can help Pine programmers save time and effort when testing various condition combinations.
█ FEATURES
Configurable alert direction
The "Direction" dropdown at the top of the "Settings/Inputs" tab specifies the allowed direction for the alert conditions. There are four possible options:
• Up only : The indicator only evaluates upward conditions.
• Down only : The indicator only evaluates downward conditions.
• Up and down (default): The indicator evaluates upward and downward conditions, creating alert triggers for both.
• Alternating : The indicator prevents alert triggers for consecutive conditions in the same direction. An upward condition must be the first occurrence after a downward condition to trigger an alert, and vice versa for downward conditions.
Flexible condition groups
This script features six text inputs where users can define distinct condition groups (ensembles) for their alerts. An alert trigger occurs if all the conditions in at least one group occur.
Each input accepts a comma-separated list of numbers with optional spaces (e.g., "1, 4, 8"). Each listed number, from 1 to 35, corresponds to a specific individual condition. Below are the conditions that the numbers represent:
1 — RSI above/below threshold
2 — RSI below/above threshold
3 — Stoch above/below threshold
4 — Stoch below/above threshold
5 — Stoch K over/under D
6 — Stoch K under/over D
7 — AO above/below threshold
8 — AO below/above threshold
9 — AO rising/falling
10 — AO falling/rising
11 — Supertrend up/down
12 — Supertrend down/up
13 — Close above/below MA
14 — Close below/above MA
15 — Close above/below open
16 — Close below/above open
17 — Close increase/decrease
18 — Close decrease/increase
19 — Close near Donchian top/bottom (Close > (Mid + HH) / 2)
20 — Close near Donchian bottom/top (Close < (Mid + LL) / 2)
21 — New Donchian high/low
22 — New Donchian low/high
23 — Rising volume
24 — Falling volume
25 — Volume above average (Volume > SMA(Volume, 20))
26 — Volume below average (Volume < SMA(Volume, 20))
27 — High body to range ratio (Abs(Close - Open) / (High - Low) > 0.5)
28 — Low body to range ratio (Abs(Close - Open) / (High - Low) < 0.5)
29 — High relative volatility (ATR(7) > ATR(40))
30 — Low relative volatility (ATR(7) < ATR(40))
31 — External condition 1
32 — External condition 2
33 — External condition 3
34 — External condition 4
35 — External condition 5
These constituent conditions fall into three distinct categories:
• Directional pairs : The numbers 1-22 correspond to pairs of opposing upward and downward conditions. For example, if one of the inputs includes "1" in the comma-separated list, that group uses the "RSI above/below threshold" condition pair. In this case, the RSI must be above a high threshold for the group to trigger an upward alert, and the RSI must be below a defined low threshold to trigger a downward alert.
• Non-directional filters : The numbers 23-30 correspond to conditions that do not represent directional information. These conditions act as filters for both upward and downward alerts. Traders often use non-directional conditions to refine trending or mean reversion signals. For instance, if one of the input lists includes "30", that group uses the "Low relative volatility" condition. The group can trigger an upward or downward alert only if the 7-period Average True Range (ATR) is below the 40-period ATR.
• External conditions : The numbers 31-35 correspond to external conditions based on the plots from other indicators on the chart. To set these conditions, use the source inputs in the "External conditions" section near the bottom of the "Settings/Inputs" tab. The external value can represent an upward, downward, or non-directional condition based on the following logic:
▫ Any value above 0 represents an upward condition.
▫ Any value below 0 represents a downward condition.
▫ If the checkbox next to the source input is selected, the condition becomes non-directional . Any group that uses the condition can trigger upward or downward alerts only if the source value is not 0.
To learn more about using plotted values from other indicators, see this article in our Help Center and the Source input section of our Pine Script™ User Manual.
Group markers
Each comma-separated list represents a distinct group , where all the listed conditions must occur to trigger an alert. This script assigns preset markers (names) to each condition group to make the active ensembles easily identifiable in the generated alert messages and labels. The markers assigned to each group use the format "M", where "M" is short for "Marker" and "x" is the group number. The titles of the inputs at the top of the "Settings/Inputs" tab show these markers for convenience.
For upward conditions, the labels and alert messages show group markers with upward triangles (e.g., "M1▲"). For downward conditions, they show markers with downward triangles (e.g., "M1▼").
NOTE: By default, this script populates the "M1" field with a pre-configured list for a mean reversion group ("2,18,24,28"). The other fields are empty. If any "M*" input does not contain a value, the indicator ignores it in the alert calculations.
Custom alert messages
By default, the indicator's alert message text contains the activated markers and their direction as a comma-separated list. Users can override this message for upward or downward alerts with the two text fields at the bottom of the "Settings/Inputs" tab. When the fields are not empty , the alerts use that text instead of the default marker list.
NOTE: This script generates alert triggers, not the alerts themselves. To set up an alert based on this script's conditions, open the "Create Alert" dialog box, then select the "Ensemble Alerts" and "Any alert() function call" options in the "Condition" tabs. See the Alerts FAQ in our Pine Script™ User Manual for more information.
Condition visualization
This script offers organized visualizations of its conditions, allowing users to inspect the behaviors of each condition alongside the specified groups. The key visual features include:
1) Conditional plots
• The indicator plots the history of each individual condition, excluding the external conditions, as circles at different levels. Opposite conditions appear at positive and negative levels with the same absolute value. The plots for each condition show values only on the bars where they occur.
• Each condition's plot is color-coded based on its type. Aqua and orange plots represent opposing directional conditions, and purple plots represent non-directional conditions. The titles of the plots also contain the condition numbers to which they apply.
• The plots in the separate pane can be turned on or off with the "Show plots in pane" checkbox near the top of the "Settings/Inputs" tab. This input only toggles the color-coded circles, which reduces the graphical load. If you deactivate these visuals, you can still inspect each condition from the script's status line and the Data Window.
• As a bonus, the indicator includes "Up alert" and "Down alert" plots in the Data Window, representing the combined upward and downward ensemble alert conditions. These plots are also usable in additional indicator-on-indicator calculations.
2) Dynamic labels
• The indicator draws a label on the main chart pane displaying the activated group markers (e.g., "M1▲") each time an alert condition occurs.
• The labels for upward alerts appear below chart bars. The labels for downward alerts appear above the bars.
NOTE: This indicator can display up to 500 labels because that is the maximum allowed for a single Pine script.
3) Background highlighting
• The indicator can highlight the main chart's background on bars where upward or downward condition groups activate. Use the "Highlight background" inputs in the "Settings/Inputs" tab to enable these highlights and customize their colors.
• Unlike the dynamic labels, these background highlights are available for all chart bars, irrespective of the number of condition occurrences.
█ NOTES
• This script uses Pine Script™ v6, the latest version of TradingView's programming language. See the Release notes and Migration guide to learn what's new in v6 and how to convert your scripts to this version.
• This script imports our new Alerts library, which features functions that provide high-level simplicity for working with complex compound conditions and alerts. We used the library's `compoundAlertMessage()` function in this indicator. It evaluates items from "bool" arrays in groups specified by an array of strings containing comma-separated index lists , returning a tuple of "string" values containing the marker of each activated group.
• The script imports the latest version of the ta library to calculate several technical indicators not included in the built-in `ta.*` namespace, including Double Exponential Moving Average (DEMA), Triple Exponential Moving Average (TEMA), Fractal Adaptive Moving Average (FRAMA), Tilson T3, Awesome Oscillator (AO), Full Stochastic (%K and %D), SuperTrend, and Donchian Channels.
• The script uses the `force_overlay` parameter in the label.new() and bgcolor() calls to display the drawings and background colors in the main chart pane.
• The plots and hlines use the available `display.*` constants to determine whether the visuals appear in the separate pane.
Look first. Then leap.
Market structureHi all!
This script shows you the market structure. You can choose to show internal market structure (with pivots of a default length of 5) and swing market structure (with pivots of a default length of 50). For these two trends it will show you:
• Break of structure (BOS)
• Change of character (CHoCH) (mandatory)
• Equal high/low (EQH/EQL)
It's inspired by "Smart Money Concepts (SMC) " by LuxAlgo that will also show you the market structure.
It will create the two market structures depending on the pivots found. Both of these market structures can be enabled/disabled. The pivots length can be configured separately. The pivots found will be the 'base' of this indicator and will show you when price breaks it. When that happens a break of structure or a change of character will be created. The latest 5 pivots found within the current trends will be kept to take action on. The internal market structure is shown with dashed lines and swing market structure is shown with solid lines.
A break of structure is removed if an earlier pivots within the same trend is broken. Like in the images below, the first pivot (in the first image) is removed when an earlier pivot's higher price within the same trend is broken (the second image):
Equal high/lows have a pink zone (by default but can be changed by the user). These zones can be configured to be extended to the right (off by default). Equal high/lows are only possible if it's not been broken by price and if a later bar has a high/low within the limit it's added to the zone (without it being more 'extreme' (high or low) then the previous price). A factor (percentage of width) of the Average True Length (of length 14) that the pivot must be within to to be considered an Equal high/low. This is configurable and sets this 'limit' and is 10 by default.
You are able to show the pivots that are used. "HH" (higher high), "HL" (higher low), "LH" (lower high), "LL" (lower low) and "H"/"L" (for pivots (high/low) when the trend has changed) are the labels used.
This script has proven itself useful for me to quickly see how the current market is. You can see the pivots (price and bar) where break of structure or change of character happens to see the current trends. I hope that you will find this useful for you.
When programming I focused on simplicity and ease of read. I did not focus on performance, I will do so if it's a problem (haven't noticed it is one yet).
You can set alerts for when a change of character happens. You can configure it to fire on when it happens (all or once per bar) but it defaults to 'once_per_bar_close' to avoid repainting. This has the drawback to alert you when the bar closes.
TLDR: this is an indicator showing you the market structure (break of structures and change of characters) using swing points/pivots. Two trends can be shown, internal (with pivots of length of 5) and swing (with pivots of the length of 50).
Best of trading luck!
Volume/Price Divergence v2The "Volume/Price Divergence v2" indicator is designed to analyze the relationship between volume and price movements in a financial market. It helps traders identify potential divergences that may indicate a change in market trends. Here’s a breakdown of how it works:
### Key Components
1. **Volume Calculation**:
- **Buying Volume**: This is calculated based on the relationship between the closing price and the high/low range. If the closing price is closer to the low, more volume is attributed to buying.
- **Selling Volume**: Conversely, if the closing price is closer to the high, more volume is considered selling.
The formulas used are:
```pinescript
buyVolume = high == low ? 0 : volume * (close - low) / (high - low)
sellVolume = high == low ? 0 : volume * (high - close) / (high - low)
```
2. **Plotting Volume**:
- The total volume is plotted in red and buying volume is plotted in teal. This helps visualize the volume distribution during different price movements.
3. **Rate of Change (ROC)**:
- The indicator calculates the rate of change for both volume and price over a specified period. This allows traders to see how volume and price are changing relative to each other.
```pinescript
roc = source / source
roc2 = source2 / source2
```
4. **Volume/Price Divergence (VPD)**:
- The VPD is derived from the ratio of the ROC of volume to the ROC of price. This ratio helps identify divergences:
- A VPD significantly above 10 may indicate strong divergence, suggesting that price movements are not supported by volume.
- A VPD around 1 indicates that volume and price are moving in harmony.
5. **Horizontal Lines**:
- The indicator includes horizontal lines at levels 10 (high divergence) and 1 (low divergence), serving as visual cues for traders to assess the market's state.
### Interpretation
- **Divergence**: If price makes a new high but volume does not follow (or vice versa), it may signal a potential reversal or weakness in the trend.
- **Volume Trends**: Analyzing the buying vs. selling volume can provide insights into market sentiment, helping traders make informed decisions.
- **Potential for a Strong Move**: A high VPD during a breakout indicates that while volume is increasing, the price isn’t moving significantly, suggesting that a big price move could be imminent.
- **Caution Before Entry**: Traders should be aware that the lack of price movement relative to high volume may signal an impending volatility spike, which could lead to a rapid price change in either direction.
Overall, this indicator is useful for traders looking to gauge the strength of price movements and identify potential reversals or breakouts based on volume trends.
Flashtrader´s Statistical BandwidthsThe vast majority of traders exclusively concern
themselves with trend-following in all its facets. Scoring
points with trends on a regular basis is a difficult task
since prices do not constantly move in one direction
or another. In the case of the DAX future, for example,
only about 30 per cent of all trading days in a year are
trend days. And of these, there are x percent long ones
and x per cent short ones. Catching the very days when
prices rise or fall from the opening to the close is a major
challenge for a trader who also needs to have previously
recognised the corresponding direction.
However, there are also other ways of profit-taking
every day – for example, by using the mean reversion
strategy. The idea behind this is the fact that prices reach
a high and a low every day – but very rarely close at the
high or the low. This means that prices always move
away from these extreme points and the closing price is
somewhere in between. A profitable trading strategy can
be developed out of this.
But how can you know where the high and the low
will be tomorrow? Is it possible for you to know this in
advance? No – because no one can predict the future. Or
can they? At least it can be statistically determined how
high or low prices could go tomorrow. There is a high
degree of probability that one of the two possibilities
will materialise. It will then be necessary to act.
Calculation
Classic pivot points for the following day are calculated
from the high, low and closing price. But does it really
make sense to use such a mix? I don’t think so and
use a different calculation for this strategy. In a first step,
only the differences between the start and the high or low
are calculated on a daily basis. To avoid being dependent
on individual days and outliers, it is advisable to calculate,
in a second step, the average of these differences over
the past five days. Finally, this average will then be added
at the opening price of the current trading day for the
upper statistical bandwidth and subtracted for the lower
bandwidth.
upper bandwidth = oSTB (violet dashed line in the chart)
lower bandwidth = uSTB (violet dashedline in the chart)
The second interesting question is, if the previous day's high has been exceeded, how much further can the price rise from a mathematical/statistical point of view?
These calculated previous day highs expansions are shown as red dashed lines
Previous day's high expansion = VTHA
Previous day's low expansion = VTTA
For further orientation, the previous day's high (VTH) and the previous day's low (VTT) are shown in light blue dashed lines
And as a supplement, the previous day's close in the DAX Future at 10:00 p.m. VTSA in violet solid lines and the previous day's close in the cash register at 5:30 p.m. VTSN in yellow solid lines
Reaching the calculated extreme values does not mean that the trend has to change immediately, but there is at least temporary exhaustion potential with which you can earn a few points every day in the area of scalping.
Example for cheap entry long:
Example for cheap entry short:
Deutsch:
Die Masse der Trader beschäftigt sich ausschließlich mit Trendfolge in all ihren Facetten. Mit Trends regelmäßig zu punkten ist ein schwieriges Unterfangen, da die Kurse nicht ständig in die eine oder andere Richtung laufen. Beim DAX-Future zum Beispiel sind von allen Börsentagen im Jahr lediglich zirka 30 Prozent Trendtage. Davon sind dann auch noch x Prozent Long und x Prozent Short. Hier genau die Tage abzupassen, an denen die Kurse von Börsenbeginn bis zum Schluss steigen beziehungsweise fallen, ist eine große Herausforderung – wobei der Trader zuvor noch die entsprechende Richtung erkannt haben muss. Es gibt jedoch auch noch andere Methoden täglich Gewinne mitzunehmen, zum Beispiel mit der Mean-Reversion-Strategie (Mittelwertumkehr).
Hintergrund ist die Tatsache, dass die Kurse jeden Tag ein Hoch und ein Tief erreichen – aber sehr selten am Hoch oder am Tief schließen. Das bedeutet, dass die Preise sich immer wie der von diesen Extrempunkten wegbewegen und der Schlusskurs irgendwo dazwischen liegt. Hieraus lässt sich eine profitable Handelsstrategie entwickeln. Aber woher kannst Du wissen, wo morgen das Hoch und das Tief sein wird? Kannst Du das vorher schon wissen? Nein – denn niemand kann die Zukunft vorhersagen. Oder doch? Statistisch lässt sich zumindest bestimmen, wie hoch und wie tief die Kurse morgen steigen oder fallen könnten. Eine Seite wird mit sehr hoher Wahrscheinlichkeit ein treffen. Dann gilt es zu handeln.
Berechnung Klassischer Pivot-Punkte für den folgenden Tag werden aus Hoch, Tief und Schlusskurs berechnet. Aber ist es wirklich sinnvoll, einen solchen Mix zu verwenden? Ich finde das nicht und verwenden für diese Strategie eine andere Berechnung. Im ersten Schritt werden täglich die Differenzen nur vom Start bis zum Hoch beziehungsweise Tief errechnet. Um nicht von einzelnen Tagen und Ausreißern abhängig zu sein, empfiehlt es sich, in einem zweiten Schritt den Durchschnitt dieser Differenzen über die letzten fünf Tage zu errechnen. Zuletzt wird dann dieser Durchschnitt zum Eröffnungskurs des aktuellen Handelstages für die obere statistische Bandbreite addiert und für die untere Bandbreite subtrahiert.
Obere statistische Bandbreite = oSTB (violette gestrichelte Linie im Chart)
Untere statistische Bandbreite = uSTB (violette gestrichelte Linie im Chart)
Die zweite interessante Frage ist, wenn das Vortageshoch überschritten wurde, wie weit kann der Kurs dann noch steigen aus mathematisch/statistischer Sicht?
Diese berechneten Vortagesextremausdehnungen sind als rote gestrichelte Linien dargestellt
Vortageshochausdehnung = VTHA
Vortagestiefausdehnung = VTTA
Für die weitere Orientierung sind die Vortageshochs (VTH) und die Vortagestiefs (VTT) als hellblaue gestrichelte Linien abgebildet.
Als Ergänzung wird noch der Vortages Schluss im Dax Future um 22:00 Uhr VTSA mit einer violetten durchgezogenen Linie und der Kassamarktschluss um 17:30 Uhr mit einer gelben durchgezogenen Linie gezeigt.
Das Erreichen der berechneten Extremwerte bedeutet nicht, das der Trend sofort drehen muss, aber es sind zumindest temporäre Erschöpfungspotentiale mit denen sich im Bereich scalping täglich einige Punkte verdienen lassen.
Beispiel für günstigen Einstieg Long:
Beispiel für günstigen Einstieg Short:
Market Structure & Session Alerts### Market Structure & Session Alerts Indicator
#### Overview
The "Market Structure & Session Alerts" indicator is a comprehensive tool designed to assist traders in identifying key market structure levels, detecting liquidity sweeps, and receiving alerts for specific trading sessions. This indicator is particularly useful for traders who want to keep an eye on previous high and low levels and be alerted during pre-London and pre-New York sessions.
#### Features
1. **Previous High/Low Levels:**
- **Daily, Weekly, and Monthly Highs and Lows:** The indicator plots the previous day, week, and month high and low levels on the chart. These levels can be crucial for identifying support and resistance zones.
- **Toggle Display:** Users can choose to show or hide these levels using the "Show Previous Day/Week/Month High/Low" option.
2. **Liquidity Sweep Detection:**
- **Liquidity Sweep Identification:** The indicator detects liquidity sweeps when the current price closes above the previous day's high. This can signal potential reversals or continuations in the market.
- **Visual Alerts:** When a liquidity sweep is detected, a green triangle is plotted below the bar.
3. **Session Alerts:**
- **Session Timings:** Users can set specific start and end times for the pre-London and pre-New York sessions to match their timezone.
- **Visual Background Highlight:** The background of the chart is highlighted in yellow during the defined session times to provide a visual cue.
- **Alert Messages:** The indicator can generate alerts to notify traders when the market enters the pre-London or pre-New York session.
4. **Current Price Line:**
- The current price is plotted as a black line, providing a clear visual reference for the current market price.
#### How to Use
1. **Input Parameters:**
- `Show Previous Day/Week/Month High/Low`: Enable or disable the display of previous high/low levels.
- `Show Liquidity Sweep`: Enable or disable the detection and display of liquidity sweeps.
- `Show Session Alerts`: Enable or disable session alerts and background highlights.
2. **Session Timing Adjustments:**
- Set the `Pre-London Start`, `Pre-London End`, `Pre-New York Start`, and `Pre-New York End` times according to your timezone to ensure accurate session alerts.
3. **Alerts:**
- Make sure alerts are enabled in your TradingView settings to receive notifications when the market enters the pre-London or pre-New York sessions.
#### Example Use Cases
- **Day Traders:** Identify potential support and resistance levels using the previous day's high and low.
- **Swing Traders:** Use weekly and monthly high and low levels to determine significant market structure points.
- **Scalpers:** Detect liquidity sweeps to identify potential quick trades.
- **Session Traders:** Be alerted when the market enters key trading sessions to align your trading strategy with major market activities.
This indicator combines multiple market analysis tools into one, providing a robust system for traders to enhance their trading decisions and market awareness.
time_and_sessionA library that provides utilities for working with trading sessions and time-based conditions. Functions include session checks, date range checks, day-of-week matching, and session high/low calculations for daily, weekly, monthly, and yearly timeframes. This library streamlines time-related calculations and enhances time-based strategies and indicators.
Library "time_and_session"
Provides functions for checking time and session-based conditions and retrieving session-specific high and low values.
is_session(session, timeframe, timezone)
Checks if the current time is within the specified trading session
Parameters:
session (string) : The trading session, defined using input.session()
timeframe (string) : The timeframe to use, defaults to the current chart's timeframe
timezone (string) : The timezone to use, defaults to the symbol's timezone
Returns: A boolean indicating whether the current time is within the specified trading session
is_date_range(start_time, end_time)
Checks if the current time is within a specified date range
Parameters:
start_time (int) : The start time, defined using input.time()
end_time (int) : The end time, defined using input.time()
Returns: A boolean indicating whether the current time is within the specified date range
is_day_of_week(sunday, monday, tuesday, wednesday, thursday, friday, saturday)
Checks if the current day of the week matches any of the specified days
Parameters:
sunday (bool) : A boolean indicating whether to check for Sunday
monday (bool) : A boolean indicating whether to check for Monday
tuesday (bool) : A boolean indicating whether to check for Tuesday
wednesday (bool) : A boolean indicating whether to check for Wednesday
thursday (bool) : A boolean indicating whether to check for Thursday
friday (bool) : A boolean indicating whether to check for Friday
saturday (bool) : A boolean indicating whether to check for Saturday
Returns: A boolean indicating whether the current day of the week matches any of the specified days
daily_high(source)
Returns the highest value of the specified source during the current daily session
Parameters:
source (float) : The data series to evaluate, defaults to high
Returns: The highest value during the current daily session, or na if the timeframe is not suitable
daily_low(source)
Returns the lowest value of the specified source during the current daily session
Parameters:
source (float) : The data series to evaluate, defaults to low
Returns: The lowest value during the current daily session, or na if the timeframe is not suitable
regular_session_high(source, persist)
Returns the highest value of the specified source during the current regular trading session
Parameters:
source (float) : The data series to evaluate, defaults to high
persist (bool) : A boolean indicating whether to retain the last value outside of regular market hours, defaults to true
Returns: The highest value during the current regular trading session, or na if the timeframe is not suitable
regular_session_low(source, persist)
Returns the lowest value of the specified source during the current regular trading session
Parameters:
source (float) : The data series to evaluate, defaults to low
persist (bool) : A boolean indicating whether to retain the last value outside of regular market hours, defaults to true
Returns: The lowest value during the current regular trading session, or na if the timeframe is not suitable
premarket_session_high(source, persist)
Returns the highest value of the specified source during the current premarket trading session
Parameters:
source (float) : The data series to evaluate, defaults to high
persist (bool) : A boolean indicating whether to retain the last value outside of premarket hours, defaults to true
Returns: The highest value during the current premarket trading session, or na if the timeframe is not suitable
premarket_session_low(source, persist)
Returns the lowest value of the specified source during the current premarket trading session
Parameters:
source (float) : The data series to evaluate, defaults to low
persist (bool) : A boolean indicating whether to retain the last value outside of premarket hours, defaults to true
Returns: The lowest value during the current premarket trading session, or na if the timeframe is not suitable
postmarket_session_high(source, persist)
Returns the highest value of the specified source during the current postmarket trading session
Parameters:
source (float) : The data series to evaluate, defaults to high
persist (bool) : A boolean indicating whether to retain the last value outside of postmarket hours, defaults to true
Returns: The highest value during the current postmarket trading session, or na if the timeframe is not suitable
postmarket_session_low(source, persist)
Returns the lowest value of the specified source during the current postmarket trading session
Parameters:
source (float) : The data series to evaluate, defaults to low
persist (bool) : A boolean indicating whether to retain the last value outside of postmarket hours, defaults to true
Returns: The lowest value during the current postmarket trading session, or na if the timeframe is not suitable
weekly_high(source)
Returns the highest value of the specified source during the current weekly session. Can fail on lower timeframes.
Parameters:
source (float) : The data series to evaluate, defaults to high
Returns: The highest value during the current weekly session, or na if the timeframe is not suitable
weekly_low(source)
Returns the lowest value of the specified source during the current weekly session. Can fail on lower timeframes.
Parameters:
source (float) : The data series to evaluate, defaults to low
Returns: The lowest value during the current weekly session, or na if the timeframe is not suitable
monthly_high(source)
Returns the highest value of the specified source during the current monthly session. Can fail on lower timeframes.
Parameters:
source (float) : The data series to evaluate, defaults to high
Returns: The highest value during the current monthly session, or na if the timeframe is not suitable
monthly_low(source)
Returns the lowest value of the specified source during the current monthly session. Can fail on lower timeframes.
Parameters:
source (float) : The data series to evaluate, defaults to low
Returns: The lowest value during the current monthly session, or na if the timeframe is not suitable
yearly_high(source)
Returns the highest value of the specified source during the current yearly session. Can fail on lower timeframes.
Parameters:
source (float) : The data series to evaluate, defaults to high
Returns: The highest value during the current yearly session, or na if the timeframe is not suitable
yearly_low(source)
Returns the lowest value of the specified source during the current yearly session. Can fail on lower timeframes.
Parameters:
source (float) : The data series to evaluate, defaults to low
Returns: The lowest value during the current yearly session, or na if the timeframe is not suitable
Futures Auto Levels [NariCapitalTrading]Futures Auto Levels Indicator
Introduction
The "Futures Auto Levels" (FAL) indicator shows the previous day's levels, weekly open, high, low, and the Initial Balance Range (IBR).
Indicator Components
The FAL indicator comprises the following components:
Previous Day's Levels: These include the open, high, low, and close of the previous trading day. They are represented on the chart by lines and labels, helping to identify significant price levels from the prior session.
Weekly Open, High, Low: These levels represent the open, high, and low prices of the current trading week.
Initial Balance Range (IBR): The IBR is calculated based on the price range during the first 60 minutes of the trading day. It helps identify initial trading range and potential breakout levels.
How to Use the Indicator
1. Previous Day's Levels:
Monitor the previous day's open, high, low, and close to identify key support and resistance levels.
Use these levels to gauge market sentiment and potential price reversals.
2. Weekly Open, High, Low:
Pay attention to the weekly open, high, and low to understand the market's behavior within the weekly timeframe.
These levels can act as reference points for setting profit targets and stop-loss orders.
3. Initial Balance Range (IBR):
Watch for price movements within the IBR to identify potential trading opportunities.
Breakouts above or below the IBR may signal the beginning of a new trend or continuation of the current trend.
Suggested/Potential Strategies
Reversal Trading: Look for price reversals around previous day's levels, especially when they coincide with other technical indicators or significant support/resistance zones.
Trend Following: Follow the trend by trading breakouts above/below the IBR or weekly high/low levels. Use trailing stops to capture profits while the trend remains intact.
Range Trading: Trade within the IBR when the market is consolidating. Buy near the IBR low and sell near the IBR high, with tight stop-loss orders to manage risk.
Conclusion
The Futures Auto Levels indicator is designed to help incorporate levels into trading analysis and trading strategies to improve profitability and consistency.
ka66: Swing/Pivot Point LinesThis indicator draws swing-highs and swing-lows, also called pivot highs and lows.
A swing high is a bar which has a higher-high than its surrounding bars (to the left and the right).
A swing low is a bar which has a lower-low than its surrounding bars (to the left and the right).
A common example of a pivot is Bill Williams' Fractal, which specifies that the centre bar must have a higher high than 2 bars to its left, and 2 bars to its right for a swing high, taking into account 5 bars at a time. Similarly, for a swing low, the centre bar must have a lower low than the 2 bars to its left and right.
This indicator allows configurable adjacent bars as input. Entering 2, means it essentially picks out a Williams Fractal. But you can select 1 (say for higher timeframes), using one 1 bar to the left and right of the centre bar.
The indicator will draw Swing/Pivot High/Low as circles at the same price level as the centre bar, till the next one shows up. Drawing is offset so it starts at the centre bar (the swing bar), showing exactly where the pivot bar is.
There are 2 main uses of pivot points, in various strategies:
Market Structure: to objectively define higher-highs/lows and lower-highs/lows in Trend Analysis.
More generally, to then determine if a trend might reverse, or continue as pivot levels are broken.
Messy pivot structures easily point out ranging markets.
There are a few of these, some closed source, which I don't like, since I think people should generally know what they are trading with, and I want to make sure I understand the logic exactly.
ATR Bands with Optional Risk/Reward Colors█ OVERVIEW
This indicator projects ATR bands and, optionally, colors them based on a risk/reward advantage for those who trade breakouts/breakdowns using moving averages as partial or full exit points.
█ DEFINITIONS
► True Range
The True Range is a measure of the volatility of a financial asset and is defined as the maximum difference among one of the following values:
- The high of the current period minus the low of the current period.
- The absolute value of the high of the current period minus the closing price of the previous period.
- The absolute value of the low of the current period minus the closing price of the previous period.
► Average True Range
The Average True Range was developed by J. Welles Wilder Jr. and was introduced in his 1978 book titled "New Concepts in Technical Trading Systems". It is calculated as an average of the true range values over a certain number of periods (usually 14) and is commonly used to measure volatility and set stop-loss and profit targets (1).
For example, if you are looking at a daily chart and you want to calculate the 14-day ATR, you would take the True Range of the previous 14 days, calculate their average, and this would be the ATR for that day. The process is then repeated every day to obtain a series of ATR values over time.
The ATR can be smoothed using different methods, such as the Simple Moving Average (SMA), the Exponential Moving Average (EMA), or others, depending on the user's preferences or analysis needs.
► ATR Bands
The ATR bands are created by adding or subtracting the ATR from a reference point (usually the closing price). This process generates bands around the central point that expand and contract based on market volatility, allowing traders to assess dynamic support and resistance levels and to adapt their trading strategies to current market conditions.
█ INDICATOR
► ATR Bands
The indicator provides all the essential parameters for calculating the ATR: period length, time frame, smoothing method, and multiplier.
It is then possible to choose the reference point from which to create the bands. The most commonly used reference points are Open, High, Low, and Close, but you can also choose the commonly used candle averages: HL2, HLC3, HLCC4, OHLC4. Among these, there is also a less common "OC2", which represents the average of the candle body. Additionally, two parameters have been specifically created for this indicator: Open/Close and High/Low.
With the "Open/Close" parameter, the upper band is calculated from the higher value between Open and Close, while the lower one is calculated from the lower value between Open and Close. In the case of bullish candles, therefore, the Close value is taken as the starting point for the upper band and the Open value for the lower one; conversely, in bearish candles, the Open value is used for the upper band and the Close value for the lower band. This setting can be useful for precautionally generating broader bands when trading with candlesticks like hammers or inverted hammers.
The "High/Low" parameter calculates the upper band starting from the High and the lower band starting from the Low. Among all the available options, this one allows drawing the widest bands.
Other possible options to improve the drawing of ATR bands, aligning them with the price action, are:
• Doji Smoothing: When the current candle is a doji (having the same Open and Close price), the bands assume the values they had on the previous candle. This can be useful to avoid steep fluctuations of the bands themselves.
• Extend to High/Low: Extends the bands to the High or Low values when they exceed the value of the band.
• Round Last Cent: Expands the upper band by one cent if the price ends with x.x9, and the lower band if the price ends with x.x1. This function only works when the asset's tick is 0.01.
► Risk/Reward Advantage
The indicator optionally colors the ATR bands after setting a breakpoint, one or two risk/reward ratios, and a series of moving averages. This function allows you to know in advance whether entering a trade can provide an advantage over the risk. The band is colored when the ratio between the distance from the break point to the band and the distance from the break point to the first available moving average reaches at least the set ratio value. It is possible to set two colorings, one for a minimum risk/reward ratio and one for an optimal risk/reward ratio.
The break point can be chosen between High/Low (High in case of breakout, Low in case of breakdown) or Open/Close (on breakouts, Close with bullish candles or Open with bearish candles; on breakdowns, Close with bearish candles or Open with bullish candles).
It is possible to choose up to 10 moving averages of various types, including the VWAP with the Anchor Period (2).
Depending on the "Price to MA" setting, the bands can be individually or simultaneously colored.
By selecting "Single Direction," the risk/reward calculation is performed only when all moving averages are above or below the break point, resulting in only one band being colored at a time. For this reason, when the break point is in between the moving averages, the calculation is not executed. This setting can be useful for strategies involving price movement from a level towards a series of specific moving averages (for example, in reversals starting from a certain level towards the VWAP with possible partial take profits on some previous moving averages, or simply in trend following towards one or more moving averages).
Choosing "Both Directions" the risk/reward ratio is calculated based on the first available moving averages both above and below the price. This setting is useful for those who operate in range bound markets or simply take advantage of movements between moving averages.
█ NOTE
This script may not be suitable for scalping strategies that require immediate entries due to the inability to know the ATR of a candle in advance until its closure. Once the candle is closed, you should have time to place a stop or stop-limit order, so your strategy should not anticipate an immediate start with the next candle. Even more conveniently, if your strategy involves an entry on a pullback, you can place a limit order at the breakout level.
(1) www.tradingview.com
(2) For convenience, the code for the Anchor Period has been entirely copied from the VWAP code provided by TradingView.
Octopus Nest Strategy Hello Fellas,
Hereby, I come up with a popular strategy from YouTube called Octopus Nest Strategy. It is a no repaint, lower timeframe scalping strategy utilizing PSAR, EMA and TTM Squeeze.
The strategy considers these market factors:
PSAR -> Trend
EMA -> Trend
TTM Squeeze -> Momentum and Volatility by incorporating Bollinger Bands and Keltner Channels
Note: As you can see there is a potential improvement by incorporating volume.
What's Different Compared To The Original Strategy?
I added an option which allows users to use the Adaptive PSAR of @loxx, which will hopefully improve results sometimes.
Signals
Enter Long -> source above EMA 100, source crosses above PSAR and TTM Squeeze crosses above 0
Enter Short -> source below EMA 100, source crosses below PSAR and TTM Squeeze crosses below 0
Exit Long and Exit Short are triggered from the risk management. Thus, it will just exit on SL or TP.
Risk Management
"High Low Stop Loss" and "Automatic High Low Take Profit" are used here.
High Low Stop Loss: Utilizes the last high for short and the last low for long to calculate the stop loss level. The last high or low gets multiplied by the user-defined multiplicator and if no recent high or low was found it uses the backup multiplier.
Automatic High Low Take Profit: Utilizes the current stop loss level of "High Low Stop Loss" and gets calculated by the user-defined risk ratio.
Now, follows the bunch of knowledge for the more inexperienced readers.
PSAR: Parabolic Stop And Reverse; Developed by J. Welles Wilders and a classic trend reversal indicator.
The indicator works most effectively in trending markets where large price moves allow traders to capture significant gains. When a security’s price is range-bound, the indicator will constantly be reversing, resulting in multiple low-profit or losing trades.
TTM Squeeze: TTM Squeeze is a volatility and momentum indicator introduced by John Carter of Trade the Markets (now Simpler Trading), which capitalizes on the tendency for price to break out strongly after consolidating in a tight trading range.
The volatility component of the TTM Squeeze indicator measures price compression using Bollinger Bands and Keltner Channels. If the Bollinger Bands are completely enclosed within the Keltner Channels, that indicates a period of very low volatility. This state is known as the squeeze. When the Bollinger Bands expand and move back outside of the Keltner Channel, the squeeze is said to have “fired”: volatility increases and prices are likely to break out of that tight trading range in one direction or the other. The on/off state of the squeeze is shown with small dots on the zero line of the indicator: red dots indicate the squeeze is on, and green dots indicate the squeeze is off.
EMA: Exponential Moving Average; Like a simple moving average, but with exponential weighting of the input data.
Don't forget to check out the settings and keep it up.
Best regards,
simwai
---
Credits to:
@loxx
@Bjorgum
@Greeny
Supertrend Advance Pullback StrategyHandbook for the Supertrend Advance Strategy
1. Introduction
Purpose of the Handbook:
The main purpose of this handbook is to serve as a comprehensive guide for traders and investors who are looking to explore and harness the potential of the Supertrend Advance Strategy. In the rapidly changing financial market, having the right tools and strategies at one's disposal is crucial. Whether you're a beginner hoping to dive into the world of trading or a seasoned investor aiming to optimize and diversify your portfolio, this handbook offers the insights and methodologies you need. By the end of this guide, readers should have a clear understanding of how the Supertrend Advance Strategy works, its benefits, potential pitfalls, and practical application in various trading scenarios.
Overview of the Supertrend Advance Pullback Strategy:
At its core, the Supertrend Advance Strategy is an evolution of the popular Supertrend Indicator. Designed to generate buy and sell signals in trending markets, the Supertrend Indicator has been a favorite tool for many traders around the world. The Advance Strategy, however, builds upon this foundation by introducing enhanced mechanisms, filters, and methodologies to increase precision and reduce false signals.
1. Basic Concept:
The Supertrend Advance Strategy relies on a combination of price action and volatility to determine the potential trend direction. By assessing the average true range (ATR) in conjunction with specific price points, this strategy aims to highlight the potential starting and ending points of market trends.
2. Methodology:
Unlike the traditional Supertrend Indicator, which primarily focuses on closing prices and ATR, the Advance Strategy integrates other critical market variables, such as volume, momentum oscillators, and perhaps even fundamental data, to validate its signals. This multidimensional approach ensures that the generated signals are more reliable and are less prone to market noise.
3. Benefits:
One of the main benefits of the Supertrend Advance Strategy is its ability to filter out false breakouts and minor price fluctuations, which can often lead to premature exits or entries in the market. By waiting for a confluence of factors to align, traders using this advanced strategy can increase their chances of entering or exiting trades at optimal points.
4. Practical Applications:
The Supertrend Advance Strategy can be applied across various timeframes, from intraday trading to swing trading and even long-term investment scenarios. Furthermore, its flexible nature allows it to be tailored to different asset classes, be it stocks, commodities, forex, or cryptocurrencies.
In the subsequent sections of this handbook, we will delve deeper into the intricacies of this strategy, offering step-by-step guidelines on its application, case studies, and tips for maximizing its efficacy in the volatile world of trading.
As you journey through this handbook, we encourage you to approach the Supertrend Advance Strategy with an open mind, testing and tweaking it as per your personal trading style and risk appetite. The ultimate goal is not just to provide you with a new tool but to empower you with a holistic strategy that can enhance your trading endeavors.
2. Getting Started
Navigating the financial markets can be a daunting task without the right tools. This section is dedicated to helping you set up the Supertrend Advance Strategy on one of the most popular charting platforms, TradingView. By following the steps below, you'll be able to integrate this strategy into your charts and start leveraging its insights in no time.
Setting up on TradingView:
TradingView is a web-based platform that offers a wide range of charting tools, social networking, and market data. Before you can apply the Supertrend Advance Strategy, you'll first need a TradingView account. If you haven't set one up yet, here's how:
1. Account Creation:
• Visit TradingView's official website.
• Click on the "Join for free" or "Sign up" button.
• Follow the registration process, providing the necessary details and setting up your login credentials.
2. Navigating the Dashboard:
• Once logged in, you'll be taken to your dashboard. Here, you'll see a variety of tools, including watchlists, alerts, and the main charting window.
• To begin charting, type in the name or ticker of the asset you're interested in the search bar at the top.
3. Configuring Chart Settings:
• Before integrating the Supertrend Advance Strategy, familiarize yourself with the chart settings. This can be accessed by clicking the 'gear' icon on the top right of the chart window.
• Adjust the chart type, time intervals, and other display settings to your preference.
Integrating the Strategy into a Chart:
Now that you're set up on TradingView, it's time to integrate the Supertrend Advance Strategy.
1. Accessing the Pine Script Editor:
• Located at the top-center of your screen, you'll find the "Pine Editor" tab. Click on it.
• This is where custom strategies and indicators are scripted or imported.
2. Loading the Supertrend Advance Strategy Script:
• Depending on whether you have the script or need to find it, there are two paths:
• If you have the script: Copy the Supertrend Advance Strategy script, and then paste it into the Pine Editor.
• If searching for the script: Click on the “Indicators” icon (looks like a flame) at the top of your screen, and then type “Supertrend Advance Strategy” in the search bar. If available, it will show up in the list. Simply click to add it to your chart.
3. Applying the Strategy:
• After pasting or selecting the Supertrend Advance Strategy in the Pine Editor, click on the “Add to Chart” button located at the top of the editor. This will overlay the strategy onto your main chart window.
4. Configuring Strategy Settings:
• Once the strategy is on your chart, you'll notice a small settings ('gear') icon next to its name in the top-left of the chart window. Click on this to access settings.
• Here, you can adjust various parameters of the Supertrend Advance Strategy to better fit your trading style or the specific asset you're analyzing.
5. Interpreting Signals:
• With the strategy applied, you'll now see buy/sell signals represented on your chart. Take time to familiarize yourself with how these look and behave over various timeframes and market conditions.
3. Strategy Overview
What is the Supertrend Advance Strategy?
The Supertrend Advance Strategy is a refined version of the classic Supertrend Indicator, which was developed to aid traders in spotting market trends. The strategy utilizes a combination of data points, including average true range (ATR) and price momentum, to generate buy and sell signals.
In essence, the Supertrend Advance Strategy can be visualized as a line that moves with the price. When the price is above the Supertrend line, it indicates an uptrend and suggests a potential buy position. Conversely, when the price is below the Supertrend line, it hints at a downtrend, suggesting a potential selling point.
Strategy Goals and Objectives:
1. Trend Identification: At the core of the Supertrend Advance Strategy is the goal to efficiently and consistently identify prevailing market trends. By recognizing these trends, traders can position themselves to capitalize on price movements in their favor.
2. Reducing Noise: Financial markets are often inundated with 'noise' - short-term price fluctuations that can mislead traders. The Supertrend Advance Strategy aims to filter out this noise, allowing for clearer decision-making.
3. Enhancing Risk Management: With clear buy and sell signals, traders can set more precise stop-loss and take-profit points. This leads to better risk management and potentially improved profitability.
4. Versatility: While primarily used for trend identification, the strategy can be integrated with other technical tools and indicators to create a comprehensive trading system.
Type of Assets/Markets to Apply the Strategy:
1. Equities: The Supertrend Advance Strategy is highly popular among stock traders. Its ability to capture long-term trends makes it particularly useful for those trading individual stocks or equity indices.
2. Forex: Given the 24-hour nature of the Forex market and its propensity for trends, the Supertrend Advance Strategy is a valuable tool for currency traders.
3. Commodities: Whether it's gold, oil, or agricultural products, commodities often move in extended trends. The strategy can help in identifying and capitalizing on these movements.
4. Cryptocurrencies: The volatile nature of cryptocurrencies means they can have pronounced trends. The Supertrend Advance Strategy can aid crypto traders in navigating these often tumultuous waters.
5. Futures & Options: Traders and investors in derivative markets can utilize the strategy to make more informed decisions about contract entries and exits.
It's important to note that while the Supertrend Advance Strategy can be applied across various assets and markets, its effectiveness might vary based on market conditions, timeframe, and the specific characteristics of the asset in question. As always, it's recommended to use the strategy in conjunction with other analytical tools and to backtest its effectiveness in specific scenarios before committing to trades.
4. Input Settings
Understanding and correctly configuring input settings is crucial for optimizing the Supertrend Advance Strategy for any specific market or asset. These settings, when tweaked correctly, can drastically impact the strategy's performance.
Grouping Inputs:
Before diving into individual input settings, it's important to group similar inputs. Grouping can simplify the user interface, making it easier to adjust settings related to a specific function or indicator.
Strategy Choice:
This input allows traders to select from various strategies that incorporate the Supertrend indicator. Options might include "Supertrend with RSI," "Supertrend with MACD," etc. By choosing a strategy, the associated input settings for that strategy become available.
Supertrend Settings:
1. Multiplier: Typically, a default value of 3 is used. This multiplier is used in the ATR calculation. Increasing it makes the Supertrend line further from prices, while decreasing it brings the line closer.
2. Period: The number of bars used in the ATR calculation. A common default is 7.
EMA Settings (Exponential Moving Average):
1. Period: Defines the number of previous bars used to calculate the EMA. Common periods are 9, 21, 50, and 200.
2. Source: Allows traders to choose which price (Open, Close, High, Low) to use in the EMA calculation.
RSI Settings (Relative Strength Index):
1. Length: Determines how many periods are used for RSI calculation. The standard setting is 14.
2. Overbought Level: The threshold at which the asset is considered overbought, typically set at 70.
3. Oversold Level: The threshold at which the asset is considered oversold, often at 30.
MACD Settings (Moving Average Convergence Divergence):
1. Short Period: The shorter EMA, usually set to 12.
2. Long Period: The longer EMA, commonly set to 26.
3. Signal Period: Defines the EMA of the MACD line, typically set at 9.
CCI Settings (Commodity Channel Index):
1. Period: The number of bars used in the CCI calculation, often set to 20.
2. Overbought Level: Typically set at +100, denoting overbought conditions.
3. Oversold Level: Usually set at -100, indicating oversold conditions.
SL/TP Settings (Stop Loss/Take Profit):
1. SL Multiplier: Defines the multiplier for the average true range (ATR) to set the stop loss.
2. TP Multiplier: Defines the multiplier for the average true range (ATR) to set the take profit.
Filtering Conditions:
This section allows traders to set conditions to filter out certain signals. For example, one might only want to take buy signals when the RSI is below 30, ensuring they buy during oversold conditions.
Trade Direction and Backtest Period:
1. Trade Direction: Allows traders to specify whether they want to take long trades, short trades, or both.
2. Backtest Period: Specifies the time range for backtesting the strategy. Traders can choose from options like 'Last 6 months,' 'Last 1 year,' etc.
It's essential to remember that while default settings are provided for many of these tools, optimal settings can vary based on the market, timeframe, and trading style. Always backtest new settings on historical data to gauge their potential efficacy.
5. Understanding Strategy Conditions
Developing an understanding of the conditions set within a trading strategy is essential for traders to maximize its potential. Here, we delve deep into the logic behind these conditions, using the Supertrend Advance Strategy as our focal point.
Basic Logic Behind Conditions:
Every strategy is built around a set of conditions that provide buy or sell signals. The conditions are based on mathematical or statistical methods and are rooted in the study of historical price data. The fundamental idea is to recognize patterns or behaviors that have been profitable in the past and might be profitable in the future.
Buy and Sell Conditions:
1. Buy Conditions: Usually formulated around bullish signals or indicators suggesting upward price momentum.
2. Sell Conditions: Centered on bearish signals or indicators indicating downward price momentum.
Simple Strategy:
The simple strategy could involve using just the Supertrend indicator. Here:
• Buy: When price closes above the Supertrend line.
• Sell: When price closes below the Supertrend line.
Pullback Strategy:
This strategy capitalizes on price retracements:
• Buy: When the price retraces to the Supertrend line after a bullish signal and is supported by another bullish indicator.
• Sell: When the price retraces to the Supertrend line after a bearish signal and is confirmed by another bearish indicator.
Indicators Used:
EMA (Exponential Moving Average):
• Logic: EMA gives more weight to recent prices, making it more responsive to current price movements. A shorter-period EMA crossing above a longer-period EMA can be a bullish sign, while the opposite is bearish.
RSI (Relative Strength Index):
• Logic: RSI measures the magnitude of recent price changes to analyze overbought or oversold conditions. Values above 70 are typically considered overbought, and values below 30 are considered oversold.
MACD (Moving Average Convergence Divergence):
• Logic: MACD assesses the relationship between two EMAs of a security’s price. The MACD line crossing above the signal line can be a bullish signal, while crossing below can be bearish.
CCI (Commodity Channel Index):
• Logic: CCI compares a security's average price change with its average price variation. A CCI value above +100 may mean the price is overbought, while below -100 might signify an oversold condition.
And others...
As the strategy expands or contracts, more indicators might be added or removed. The crucial point is to understand the core logic behind each, ensuring they align with the strategy's objectives.
Logic Behind Each Indicator:
1. EMA: Emphasizes recent price movements; provides dynamic support and resistance levels.
2. RSI: Indicates overbought and oversold conditions based on recent price changes.
3. MACD: Showcases momentum and direction of a trend by comparing two EMAs.
4. CCI: Measures the difference between a security's price change and its average price change.
Understanding strategy conditions is not just about knowing when to buy or sell but also about comprehending the underlying market dynamics that those conditions represent. As you familiarize yourself with each condition and indicator, you'll be better prepared to adapt and evolve with the ever-changing financial markets.
6. Trade Execution and Management
Trade execution and management are crucial aspects of any trading strategy. Efficient execution can significantly impact profitability, while effective management can preserve capital during adverse market conditions. In this section, we'll explore the nuances of position entry, exit strategies, and various Stop Loss (SL) and Take Profit (TP) methodologies within the Supertrend Advance Strategy.
Position Entry:
Effective trade entry revolves around:
1. Timing: Enter at a point where the risk-reward ratio is favorable. This often corresponds to confirmatory signals from multiple indicators.
2. Volume Analysis: Ensure there's adequate volume to support the movement. Volume can validate the strength of a signal.
3. Confirmation: Use multiple indicators or chart patterns to confirm the entry point. For instance, a buy signal from the Supertrend indicator can be confirmed with a bullish MACD crossover.
Position Exit Strategies:
A successful exit strategy will lock in profits and minimize losses. Here are some strategies:
1. Fixed Time Exit: Exiting after a predetermined period.
2. Percentage-based Profit Target: Exiting after a certain percentage gain.
3. Indicator-based Exit: Exiting when an indicator gives an opposing signal.
Percentage-based SL/TP:
• Stop Loss (SL): Set a fixed percentage below the entry price to limit potential losses.
• Example: A 2% SL on an entry at $100 would trigger a sell at $98.
• Take Profit (TP): Set a fixed percentage above the entry price to lock in gains.
• Example: A 5% TP on an entry at $100 would trigger a sell at $105.
Supertrend-based SL/TP:
• Stop Loss (SL): Position the SL at the Supertrend line. If the price breaches this line, it could indicate a trend reversal.
• Take Profit (TP): One could set the TP at a point where the Supertrend line flattens or turns, indicating a possible slowdown in momentum.
Swing high/low-based SL/TP:
• Stop Loss (SL): For a long position, set the SL just below the recent swing low. For a short position, set it just above the recent swing high.
• Take Profit (TP): For a long position, set the TP near a recent swing high or resistance. For a short position, near a swing low or support.
And other methods...
1. Trailing Stop Loss: This dynamic SL adjusts with the price movement, locking in profits as the trade moves in your favor.
2. Multiple Take Profits: Divide the position into segments and set multiple TP levels, securing profits in stages.
3. Opposite Signal Exit: Exit when another reliable indicator gives an opposite signal.
Trade execution and management are as much an art as they are a science. They require a blend of analytical skill, discipline, and intuition. Regularly reviewing and refining your strategies, especially in light of changing market conditions, is crucial to maintaining consistent trading performance.
7. Visual Representations
Visual tools are essential for traders, as they simplify complex data into an easily interpretable format. Properly analyzing and understanding the plots on a chart can provide actionable insights and a more intuitive grasp of market conditions. In this section, we’ll delve into various visual representations used in the Supertrend Advance Strategy and their significance.
Understanding Plots on the Chart:
Charts are the primary visual aids for traders. The arrangement of data points, lines, and colors on them tell a story about the market's past, present, and potential future moves.
1. Data Points: These represent individual price actions over a specific timeframe. For instance, a daily chart will have data points showing the opening, closing, high, and low prices for each day.
2. Colors: Used to indicate the nature of price movement. Commonly, green is used for bullish (upward) moves and red for bearish (downward) moves.
Trend Lines:
Trend lines are straight lines drawn on a chart that connect a series of price points. Their significance:
1. Uptrend Line: Drawn along the lows, representing support. A break below might indicate a trend reversal.
2. Downtrend Line: Drawn along the highs, indicating resistance. A break above might suggest the start of a bullish trend.
Filled Areas:
These represent a range between two values on a chart, usually shaded or colored. For instance:
1. Bollinger Bands: The area between the upper and lower band is filled, giving a visual representation of volatility.
2. Volume Profile: Can show a filled area representing the amount of trading activity at different price levels.
Stop Loss and Take Profit Lines:
These are horizontal lines representing pre-determined exit points for trades.
1. Stop Loss Line: Indicates the level at which a trade will be automatically closed to limit losses. Positioned according to the trader's risk tolerance.
2. Take Profit Line: Denotes the target level to lock in profits. Set according to potential resistance (for long trades) or support (for short trades) or other technical factors.
Trailing Stop Lines:
A trailing stop is a dynamic form of stop loss that moves with the price. On a chart:
1. For Long Trades: Starts below the entry price and moves up with the price but remains static if the price falls, ensuring profits are locked in.
2. For Short Trades: Starts above the entry price and moves down with the price but remains static if the price rises.
Visual representations offer traders a clear, organized view of market dynamics. Familiarity with these tools ensures that traders can quickly and accurately interpret chart data, leading to more informed decision-making. Always ensure that the visual aids used resonate with your trading style and strategy for the best results.
8. Backtesting
Backtesting is a fundamental process in strategy development, enabling traders to evaluate the efficacy of their strategy using historical data. It provides a snapshot of how the strategy would have performed in past market conditions, offering insights into its potential strengths and vulnerabilities. In this section, we'll explore the intricacies of setting up and analyzing backtest results and the caveats one must be aware of.
Setting Up Backtest Period:
1. Duration: Determine the timeframe for the backtest. It should be long enough to capture various market conditions (bullish, bearish, sideways). For instance, if you're testing a daily strategy, consider a period of several years.
2. Data Quality: Ensure the data source is reliable, offering high-resolution and clean data. This is vital to get accurate backtest results.
3. Segmentation: Instead of a continuous period, sometimes it's helpful to backtest over distinct market phases, like a particular bear or bull market, to see how the strategy holds up in different environments.
Analyzing Backtest Results:
1. Performance Metrics: Examine metrics like the total return, annualized return, maximum drawdown, Sharpe ratio, and others to gauge the strategy's efficiency.
2. Win Rate: It's the ratio of winning trades to total trades. A high win rate doesn't always signify a good strategy; it should be evaluated in conjunction with other metrics.
3. Risk/Reward: Understand the average profit versus the average loss per trade. A strategy might have a low win rate but still be profitable if the average gain far exceeds the average loss.
4. Drawdown Analysis: Review the periods of losses the strategy could incur and how long it takes, on average, to recover.
9. Tips and Best Practices
Successful trading requires more than just knowing how a strategy works. It necessitates an understanding of when to apply it, how to adjust it to varying market conditions, and the wisdom to recognize and avoid common pitfalls. This section offers insightful tips and best practices to enhance the application of the Supertrend Advance Strategy.
When to Use the Strategy:
1. Market Conditions: Ideally, employ the Supertrend Advance Strategy during trending market conditions. This strategy thrives when there are clear upward or downward trends. It might be less effective during consolidative or sideways markets.
2. News Events: Be cautious around significant news events, as they can cause extreme volatility. It might be wise to avoid trading immediately before and after high-impact news.
3. Liquidity: Ensure you are trading in assets/markets with sufficient liquidity. High liquidity ensures that the price movements are more reflective of genuine market sentiment and not due to thin volume.
Adjusting Settings for Different Markets/Timeframes:
1. Markets: Each market (stocks, forex, commodities) has its own characteristics. It's essential to adjust the strategy's parameters to align with the market's volatility and liquidity.
2. Timeframes: Shorter timeframes (like 1-minute or 5-minute charts) tend to have more noise. You might need to adjust the settings to filter out false signals. Conversely, for longer timeframes (like daily or weekly charts), you might need to be more responsive to genuine trend changes.
3. Customization: Regularly review and tweak the strategy's settings. Periodic adjustments can ensure the strategy remains optimized for the current market conditions.
10. Frequently Asked Questions (FAQs)
Given the complexities and nuances of the Supertrend Advance Strategy, it's only natural for traders, both new and seasoned, to have questions. This section addresses some of the most commonly asked questions regarding the strategy.
1. What exactly is the Supertrend Advance Strategy?
The Supertrend Advance Strategy is an evolved version of the traditional Supertrend indicator. It's designed to provide clearer buy and sell signals by incorporating additional indicators like EMA, RSI, MACD, CCI, etc. The strategy aims to capitalize on market trends while minimizing false signals.
2. Can I use the Supertrend Advance Strategy for all asset types?
Yes, the strategy can be applied to various asset types like stocks, forex, commodities, and cryptocurrencies. However, it's crucial to adjust the settings accordingly to suit the specific characteristics and volatility of each asset type.
3. Is this strategy suitable for day trading?
Absolutely! The Supertrend Advance Strategy can be adjusted to suit various timeframes, making it versatile for both day trading and long-term trading. Remember to fine-tune the settings to align with the timeframe you're trading on.
4. How do I deal with false signals?
No strategy is immune to false signals. However, by combining the Supertrend with other indicators and adhering to strict risk management protocols, you can minimize the impact of false signals. Always use stop-loss orders and consider filtering trades with additional confirmation signals.
5. Do I need any prior trading experience to use this strategy?
While the Supertrend Advance Strategy is designed to be user-friendly, having a foundational understanding of trading and market analysis can greatly enhance your ability to employ the strategy effectively. If you're a beginner, consider pairing the strategy with further education and practice on demo accounts.
6. How often should I review and adjust the strategy settings?
There's no one-size-fits-all answer. Some traders adjust settings weekly, while others might do it monthly. The key is to remain responsive to changing market conditions. Regular backtesting can give insights into potential required adjustments.
7. Can the Supertrend Advance Strategy be automated?
Yes, many traders use algorithmic trading platforms to automate their strategies, including the Supertrend Advance Strategy. However, always monitor automated systems regularly to ensure they're operating as intended.
8. Are there any markets or conditions where the strategy shouldn't be used?
The strategy might generate more false signals in markets that are consolidative or range-bound. During significant news events or times of unexpected high volatility, it's advisable to tread with caution or stay out of the market.
9. How important is backtesting with this strategy?
Backtesting is crucial as it allows traders to understand how the strategy would have performed in the past, offering insights into potential profitability and areas of improvement. Always backtest any new setting or tweak before applying it to live trades.
10. What if the strategy isn't working for me?
No strategy guarantees consistent profits. If it's not working for you, consider reviewing your settings, seeking expert advice, or complementing the Supertrend Advance Strategy with other analysis methods. Remember, continuous learning and adaptation are the keys to trading success.
Other comments
Value of combining several indicators in this script and how they work together
Diversification of Signals: Just as diversifying an investment portfolio can reduce risk, using multiple indicators can offer varied perspectives on potential price movements. Each indicator can capture a different facet of the market, ensuring that traders are not overly reliant on a single data point.
Confirmation & Reduced False Signals: A common challenge with many indicators is the potential for false signals. By requiring confirmation from multiple indicators before acting, the chances of acting on a false signal can be significantly reduced.
Flexibility Across Market Conditions: Different indicators might perform better under different market conditions. For example, while moving averages might excel in trending markets, oscillators like RSI might be more useful during sideways or range-bound conditions. A mashup strategy can potentially adapt better to varying market scenarios.
Comprehensive Analysis: With multiple indicators, traders can gauge trend strength, momentum, volatility, and potential market reversals all at once, providing a holistic view of the market.
How do the different indicators in the Supertrend Advance Strategy work together?
Supertrend: This is primarily a trend-following indicator. It provides traders with buy and sell signals based on the volatility of the price. When combined with other indicators, it can filter out noise and give more weight to strong, confirmed trends.
EMA (Exponential Moving Average): EMA gives more weight to recent price data. It can be used to identify the direction and strength of a trend. When the price is above the EMA, it's generally considered bullish, and vice versa.
RSI (Relative Strength Index): An oscillator that measures the magnitude of recent price changes to evaluate overbought or oversold conditions. By cross-referencing with other indicators like EMA or MACD, traders can spot potential reversals or confirmations of a trend.
MACD (Moving Average Convergence Divergence): This indicator identifies changes in the strength, direction, momentum, and duration of a trend in a stock's price. When the MACD line crosses above the signal line, it can be a bullish sign, and when it crosses below, it can be bearish. Pairing MACD with Supertrend can provide dual confirmation of a trend.
CCI (Commodity Channel Index): Initially developed for commodities, CCI can indicate overbought or oversold conditions. It can be used in conjunction with other indicators to determine entry and exit points.
In essence, the synergy of these indicators provides a balanced, comprehensive approach to trading. Each indicator offers its unique lens into market conditions, and when they align, it can be a powerful indication of a trading opportunity. This combination not only reduces the potential drawbacks of each individual indicator but leverages their strengths, aiming for more consistent and informed trading decisions.
Backtesting and Default Settings
• This indicator has been optimized to be applied for 1 hour-charts. However, the underlying principles of this strategy are supply and demand in the financial markets and the strategy can be applied to all timeframes. Daytraders can use the 1min- or 5min charts, swing-traders can use the daily charts.
• This strategy has been designed to identify the most promising, highest probability entries and trades for each stock or other financial security.
• The combination of the qualifiers results in a highly selective strategy which only considers the most promising swing-trading entries. As a result, you will normally only find a low number of trades for each stock or other financial security per year in case you apply this strategy for the daily charts. Shorter timeframes will result in a higher number of trades / year.
• Consequently, traders need to apply this strategy for a full watchlist rather than just one financial security.
• Default properties: RSI on (length 14, RSI buy level 50, sell level 50), EMA, RSI, MACD on, type of strategy pullback, SL/TP type: ATR (length 10, factor 3), trade direction both, quantity 5, take profit swing hl 5.1, highest / lowest lookback 2, enable ATR trail (ATR length 10, SL ATR multiplier 1.4, TP multiplier 2.1, lookback = 4, trade direction = both).
Market Pivot Levels [Past & Live]Market Levels provide a robust view of daily pivot points of markets such as high/low/close with both past and live values shown at the same time using the recently updated system of polylines of pinescript.
The main need for this script arose from not being able to use plots for daily points because plots are inherently once drawn can't be erased and because we can't plot stuff for previous bars after values are determined we can't use them reliably. And while we can use traditional lines, because we would have extremely high amount of lines and we would have to keep removing the previous ones it wouldn't be that effective way for us. So we try to do it with the new method of polylines .
Features of this script:
- Daily High/Low Points
- Yesterday High/Low/Close Points
- Pre-Market High-Low points.
Now let's preview some of the important points of code and see how we achieve this:
With the code below we make sure no matter which chart we are using we are getting the extended hours version of sessions so our calculations are made safely for viewing pre-market conditions.
// Let's get ticker extended no matter what the current chart is
tc = ticker.new(syminfo.prefix, syminfo.ticker, session.extended)
Coding our own function to calculate high's and low's because inbuilt pinescript function cannot take series and we send this function to retrieve our high's and lows.
// On the fly function to calculate daily highlows instead of tv inbuilt because tv's length cannot take series
f_highlow(int last) =>
bardiff = last
float _low = low, float _high = high
for i = bardiff to 0 by 1
if high > _high
_high := high
if low < _low
_low := low
With doing calculations at the bars of day ending points we can retrieve the correct points and values and push them for our polylines array so it can be used in best way possible.
// Daily change points
changeD = timeframe.change("D")
// When new day starts fill polyline arrays with previous day values for polylines to draw on chart
// We also update prevtime values with current ones after we pushed to the arrays
if changeD
f_arrFill(cpArrHigh, cpArrLow, prevArrh, prevArrl, prevArrc, prevMarh, prevMarl)
valHolder.unshift(valueHold.new(_high, _low, _high, _close, _low, time, pr_h, pr_l))
The rest of the code is annotated and commented. You can let me know in comments if you have any questions. Happy trading.
AI Momentum [YinYang]Overview:
AI Momentum is a kernel function based momentum Indicator. It uses Rational Quadratics to help smooth out the Moving Averages, this may give them a more accurate result. This Indicator has 2 main uses, first it displays ‘Zones’ that help you visualize the potential movement areas and when the price is out of bounds (Overvalued or Undervalued). Secondly it creates signals that display the momentum of the current trend.
The Zones are composed of the Highest Highs and Lowest lows turned into a Rational Quadratic over varying lengths. These create our Rational High and Low zones. There is however a second zone. The second zone is composed of the avg of the Inner High and Inner Low zones (yellow line) and the Rational Quadratic of the current Close. This helps to create a second zone that is within the High and Low bounds that may represent momentum changes within these zones. When the Rationalized Close crosses above the High and Low Zone Average it may signify a bullish momentum change and vice versa when it crosses below.
There are 3 different signals created to display momentum:
Bullish and Bearish Momentum. These signals display when there is current bullish or bearish momentum happening within the trend. When the momentum changes there will likely be a lull where there are neither Bullish or Bearish momentum signals. These signals may be useful to help visualize when the momentum has started and stopped for both the bulls and the bears. Bullish Momentum is calculated by checking if the Rational Quadratic Close > Rational Quadratic of the Highest OHLC4 smoothed over a VWMA. The Bearish Momentum is calculated by checking the opposite.
Overly Bullish and Bearish Momentum. These signals occur when the bar has Bullish or Bearish Momentum and also has an Rationalized RSI greater or less than a certain level. Bullish is >= 57 and Bearish is <= 43. There is also the option to ‘Factor Volume’ into these signals. This means, the Overly Bullish and Bearish Signals will only occur when the Rationalized Volume > VWMA Rationalized Volume as well as the previously mentioned factors above. This can be useful for removing ‘clutter’ as volume may dictate when these momentum changes will occur, but it can also remove some of the useful signals and you may miss the swing too if the volume just was low. Overly Bullish and Bearish Momentum may dictate when a momentum change will occur. Remember, they are OVERLY Bullish and Bearish, meaning there is a chance a correction may occur around these signals.
Bull and Bear Crosses. These signals occur when the Rationalized Close crosses the Gaussian Close that is 2 bars back. These signals may show when there is a strong change in momentum, but be careful as more often than not they’re predicting that the momentum may change in the opposite direction.
Tutorial:
As we can see in the example above, generally what happens is we get the regular Bullish or Bearish momentum, followed by the Rationalized Close crossing the Zone average and finally the Overly Bullish or Bearish signals. This is normally the order of operations but isn’t always how it happens as sometimes momentum changes don’t make it that far; also the Rationalized Close and Zone Average don’t follow any of the same math as the Signals which can result in differing appearances. The Bull and Bear Crosses are also quite sporadic in appearance and don’t generally follow any sort of order of operations. However, they may occur as a Predictor between Bullish and Bearish momentum, signifying the beginning of the momentum change.
The Bull and Bear crosses may be a Predictor of momentum change. They generally happen when there is no Bullish or Bearish momentum happening; and this helps to add strength to their prediction. When they occur during momentum (orange circle) there is a less likely chance that it will happen, and may instead signify the exact opposite; it may help predict a large spike in momentum in the direction of the Bullish or Bearish momentum. In the case of the orange circle, there is currently Bearish Momentum and therefore the Bull Cross may help predict a large momentum movement is about to occur in favor of the Bears.
We have disabled signals here to properly display and talk about the zones. As you can see, Rationalizing the Highest Highs and Lowest Lows over 2 different lengths creates inner and outer bounds that help to predict where parabolic movement and momentum may move to. Our Inner and Outer zones are great for seeing potential Support and Resistance locations.
The secondary zone, which can cross over and change from Green to Red is also a very important zone. Let's zoom in and talk about it specifically.
The Middle Zone Crosses may help deduce where parabolic movement and strong momentum changes may occur. Generally what may happen is when the cross occurs, you will see parabolic movement to the High / Low zones. This may be the Inner zone but can sometimes be the outer zone too. The hard part is sometimes it can be a Fakeout, like displayed with the Blue Circle. The Cross doesn’t mean it may move to the opposing side, sometimes it may just be predicting Parabolic movement in a general sense.
When we turn the Momentum Signals back on, we can see where the Fakeout occurred that it not only almost hit the Inner Low Zone but it also exhibited 2 Overly Bearish Signals. Remember, Overly bearish signals mean a momentum change in favor of the Bulls may occur soon and overly Bullish signals mean a momentum change in favor of the Bears may occur soon.
You may be wondering, well what does “may occur soon” mean and how do we tell?
The purpose of the momentum signals is not only to let you know when Momentum has occurred and when it is still prevalent. It also matters A LOT when it has STOPPED!
In this example above, we look at when the Overly Bullish and Bearish Momentum has STOPPED. As you can see, when the Overly Bullish or Bearish Momentum stopped may be a strong predictor of potential momentum change in the opposing direction.
We will conclude our Tutorial here, hopefully this Indicator has been helpful for showing you where momentum is occurring and help predict how far it may move. We have been dabbling with and are planning on releasing a Strategy based on this Indicator shortly.
Settings:
1. Momentum:
Show Signals: Sometimes it can be difficult to visualize the zones with signals enabled.
Factor Volume: Factor Volume only applies to Overly Bullish and Bearish Signals. It's when the Volume is > VWMA Volume over the Smoothing Length.
Zone Inside Length: The Zone Inside is the Inner zone of the High and Low. This is the length used to create it.
Zone Outside Length: The Zone Outside is the Outer zone of the High and Low. This is the length used to create it.
Smoothing length: Smoothing length is the length used to smooth out our Bullish and Bearish signals, along with our Overly Bullish and Overly Bearish Signals.
2. Kernel Settings:
Lookback Window: The number of bars used for the estimation. This is a sliding value that represents the most recent historical bars. Recommended range: 3-50.
Relative Weighting: Relative weighting of time frames. As this value approaches zero, the longer time frames will exert more influence on the estimation. As this value approaches infinity, the behavior of the Rational Quadratic Kernel will become identical to the Gaussian kernel. Recommended range: 0.25-25.
Start Regression at Bar: Bar index on which to start regression. The first bars of a chart are often highly volatile, and omission of these initial bars often leads to a better overall fit. Recommended range: 5-25.
If you have any questions, comments, ideas or concerns please don't hesitate to contact us.
HAPPY TRADING!
YinYang RSI Volume Trend StrategyThere are many strategies that use RSI or Volume but very few that take advantage of how useful and important the two of them combined are. This strategy uses the Highs and Lows with Volume and RSI weighted calculations on top of them. You may be wondering how much of an impact Volume and RSI can have on the prices; the answer is a lot and we will discuss those with plenty of examples below, but first…
How does this strategy work?
It’s simple really, when the purchase source crosses above the inner low band (red) it creates a Buy or Long. This long has a Trailing Stop Loss band (the outer low band that's also red) that can be adjusted in the Settings. The Stop Loss is based on a % of the inner low band’s price and by default it is 0.1% lower than the inner band’s price. This Stop Loss is not only a stop loss but it can also act as a Purchase Available location.
You can get back into a trade after a stop loss / take profit has been hit when your Reset Purchase Availability After condition has been met. This can either be at Stop Loss, Entry or None.
It is advised to allow it to reset in case the stop loss was a fake out but the call was right. Sometimes it may trigger stop loss multiple times in a row, but you don’t lose much on stop loss and you gain lots when the call is right.
The Take Profit location is the basis line (white). Take Profit occurs when the Exit Source (close, open, high, low or other) crosses the basis line and then on a different bar the Exit Source crosses back over the basis line. For example, if it was a Long and the bar’s Exit Source closed above the basis line, and then 2 bars later its Exit Source closed below the basis line, Take Profit would occur. You can disable Take Profit in Settings, but it is very useful as many times the price will cross the Basis and then correct back rather than making it all the way to the opposing zone.
Longs:
If for instance your Long doesn’t need to Take Profit and instead reaches the top zone, it will close the position when it crosses above the inner top line (green).
Please note you can change the Exit Source too which is what source (close, open, high, low) it uses to end the trades.
The Shorts work the same way as the Long but just opposite, they start when the purchase source crosses under the inner upper band (green).
Shorts:
Shorts take profit when it crosses under the basis line and then crosses back.
Shorts will Stop loss when their outer upper band (green) is crossed with the Exit Source.
Short trades are completed and closed when its Exit Source crosses under the inner low red band.
So, now that you understand how the strategy works, let’s discuss why this strategy works and how it is profitable.
First we will discuss Volume as we deem it plays a much bigger role overall and in our strategy:
As I’m sure many of you know, Volume plays a huge factor in how much something moves, but it also plays a role in the strength of the movement. For instance, let’s look at two scenarios:
Bitcoin’s price goes up $1000 in 1 Day but the Volume was only 10 million
Bitcoin’s price goes up $200 in 1 Day but the Volume was 40 million
If you were to only look at the price, you’d say #1 was more important because the price moved x5 the amount as #2, but once you factor in the volume, you know this is not true. The reason why Volume plays such a huge role in Price movement is because it shows there is a large Limit Order battle going on. It means that both Bears and Bulls believe that price is a good time to Buy and Sell. This creates a strong Support and Resistance price point in this location. If we look at scenario #2, when there is high volume, especially if it is drastically larger than the average volume Bitcoin was displaying recently, what can we decipher from this? Well, the biggest take away is that the Bull’s won the battle, and that likely when that happens we will see bullish movement continuing to happen as most of the Bears Limit Orders have been fulfilled. Whereas with #2, when large price movement happens and Bitcoin goes up $1000 with low volume what can we deduce? The main takeaway is that Bull’s pressured the price up with Market Orders where they purchased the best available price, also what this means is there were very few people who were wanting to sell. This generally dictates that Whale Limit orders for Sells/Shorts are much higher up and theres room for movement, but it also means there is likely a whale that is ready to dump and crash it back down.
You may be wondering, what did this example have to do with YinYang RSI Volume Trend Strategy? Well the reason we’ve discussed this is because we use Volume multiple times to apply multiplications in our calculations to add large weight to the price when there is lots of volume (this is applied both positively and negatively). For instance, if the price drops a little and there is high volume, our strategy will move its bounds MUCH lower than the price actually dropped, and if there was low volume but the price dropped A LOT, our strategy will only move its bounds a little. We believe this reflects higher levels of price accuracy than just price alone based on the examples described above.
Don’t believe us?
Here is with Volume NOT factored in (VWMA = SMA and we remove our Volume Filter calculation):
Which produced -$2880 Profit
Here is with our Volume factored in:
Which produced $553,000 (55.3%)
As you can see, we wen’t from $-2800 profit with volume not factored to $553,000 with volume factored. That's quite a big difference! (Please note previous success does not predict future success we are simply displaying the $ amounts as example).
Now how about RSI and why does it matter in this strategy?
As I’m sure most of you are aware, RSI is one of the leading indicators used in trading. For this reason we figured it would only make sense to incorporate it into our calculations. We fiddled with RSI for quite awhile and sometimes what logically seems to be the right way to use it isn’t. Now, because of this, our RSI calculation is a little odd, but basically what we’re doing is we calculate the RSI, then turn it into a percentage (between 0-1) that can easily be multiplied to the price point we need. The price point we use is the difference between our high purchase zone and our low purchase zone. This allows us to see how much price movement there is between zones. We multiply our zone size with our RSI multiplication and we get the amount we will add +/- to our basis line (white line). This officially creates the NEW high and low purchase zones that we are actually using and displaying in our trades.
If you found that confusing, here are some examples to why it is an important calculation for this strategy:
Before RSI factored in:
Which produced 27.8% Profit
After RSI factored in:
Which produced 553% Profit
As you can see, the RSI makes not only the purchase zones more accurate, but it also greatly increases the profit the strategy is able to make. It also helps ensure an relatively linear profit slope so you know it is reliable with its trades.
This strategy can work on pretty much anything, but you should tweak the values a bit for each pair you are trading it with for best results.
We hope you can find some use out of this simple but effective strategy, if you have any questions, comments or concerns please let us know.
HAPPY TRADING!
LIT - TimingIntroduction
This Script displays the Asia Session Range, the London Open Inducement Window, the NY Open Inducement Window, the Previous Week's high and low, the Previous Day's highs and lows, and the Day Open price in the cleanest way possible.
Description
The Indicator is based on UTC -7 timing but displays the Session Boxes automatically correct at your chart so you do not have to adjust any timings based on your Time Zone and don't have to do any calculations based on your UTC. It is already perfect.
You will see on default settings the purple Asia Box and 2 grey boxes, the first one is for the London Open Inducement Window (1 hour) and the second grey box is for the NY Open Inducement Window (also 1 hour)
Asia Range comes with default settings with the Asia Range high, low, and midline, you can remove these 3 lines in the settings "style" and untick the "Lines" box, that way you only will have the boxes displayed.
Special Feature
Most Timing-based Indicators have "bugged" boxes or don't show clean boxes at all and don't adjust at daylight savings times, we made sure that everything automatically gets adjusted so you don't have to! So the timings will always display at the correct time regarding the daylight savings times.
Combining Timing with Liquidity Zones the right way and in a clear, clean, and simple format.
Different than others this script also shows the "true" Asia range as it respects the "day open gap" which affects the Asia range in other scripts and it also covers the full 8 hours of Asia Session.
Additions
You can add in the settings menu the last week's high and low, the previous day's high and low, and also the day's open price by ticking the boxes in the settings menu
All colors of the boxes are fully adjustable and customizable for your personal preferences. Same for the previous weeks and day highs and lows. Just go to "Style" and you can adjust the Line types or colors to your preferred choice.
Recommended Use
The most beautiful display is on the M5 Timeframe as you have a clear overview of all sessions without losing the intraday view. You can also use it on the M1 for more details or the M15 for the bigger picture. The Template can hide on higher time frames starting from the H1 to not flood your chart with boxes.
How to use the Asia Session Range Box
Use the Asia Range Box as your intraday Guide, keep in mind that a Breakout of Asia high or low induces Liquidity and a common price behavior is a reversal after the fake breakout of that range.
How to use the London Open and NY Open Inducement Windows
Both grey boxes highlight the Open of either London Open or NY Open and you should keep an eye out for potential Liquditiy Graps or Mitigations during that times as this is when they introduce major Liquidity for the regarding Session.
How to use the Asia high, low and midline and day open price
After Asia Range got taken out in one direction, often price comes back to those levels to mitigate or bounce off, so you can imagine those zones as support and resistance on some occasions, recommended in combination with Imbalances.
How to use the previous day and week's highs and lows
Once added in the settings, you can display those price levels, you can use them either as Liquidity Targets or as Inducement Levels once they are taken out.
Enjoy!
Autoregressive CloudHello,
I am releasing this indicator called the Autoregressive Cloud Indicator.
What it does:
The indicator performs an autoregression analysis on 3 price variables of a ticker, those being the High, the Low and the Close. It uses a 1-lag system and looks back at the previous close, high and low’s effect on the proceeding high, low and close. It then plots out the anticipated range for the ticker based on the autoregression analysis, as well as displays the lag-correlation (autocorrelation) in a table.
What is Autoregression analysis?
Autoregression is a modelling technique used to describe a time series based on its own past values. It assumes that the current value of a variable is a linear combination of its previous values and a random error term.
And what is autocorrelation?
Autocorrelation measures the correlation between a time series and its lagged values. It quantifies the degree to which the current value of a series is related to its past values at different lags, indicating any patterns or dependencies in the data over time. Autoregression and autocorrelation are closely related concepts used to analyze and model time series data.
So how does it work?
The indicator calculates autoregressive values for the close, high, and low prices of a security based on the specified lookback length (which is defaulted to 50). It then plots three sets of clouds representing the smoothed autoregressive values for each price component (done using the SMA function). The transparency of the clouds can be adjusted using the "Transparency" input. Additionally, the code includes a correlation table that displays the correlation coefficients between the lagged values of the close, high, and low prices. The table's position can be customized using the "Position" input.
The indicator defaults to the chart timeframe; however, you can manually adjust the indicator to display the range for whatever timeframe you would like. You can view the 30 minute, 15 or even hourly range on the 1 minute or 5 minute chart if you want.
The indicator will show the anticipated “true trading range” of the stock based on the autoregression and autocorrelation of all 3 variables:
Above is SPY on the 5 minute timeframe with 15 minute levels overlayed. Here, you can see the anticipated trading range for that 15 minute time period.
Using the Correlation Table:
The correlation table displays the Pearson Coefficient for all 3 autoregressions.
A positive correlation: A positive autocorrelation indicates a positive relationship between past and current values of a time series variable. It suggests that when the variable has a high value at a certain time, it is more likely to have a high value in the future, and when it has a low value, it is more likely to have a low value in the future. This positive autocorrelation can imply persistence or trend in the data, indicating that past values can provide useful information for predicting future values. The rule of thumb is anything over 0.5 is considered significant.
A positive correlation among all 3 variables also indicates an uptrend. If you see a strong positive (i.e. the values are all greater than 0.8), it indicates an incredibly decisive and strong uptrend.
A negative correlation: A negative autocorrelation indicates an inverse relationship between past and current values of a time series variable. It suggests that when the variable has a high value at a certain time, it is more likely to have a low value in the future, and vice versa. This negative autocorrelation can imply mean reversion or oscillatory behavior in the data, where extreme values tend to be followed by values closer to the average. It indicates that past values can provide useful information for predicting future values by anticipating a reversal in the direction of the variable. The rule of thumb is anything below or equal to -0.5 is considered significant.
A negative correlation among all 3 variables also indicates a downtrend. If you see a strong negative (i.e. the values are all less than or equal to -0.8), it indicates an incredibly decisive and strong downtrend.
Uses of the Indicator:
The indicator can be used for the following functions:
1. Day trading and scalping within an expected range;
2. Determining the strength or weakness of an uptrend or downtrend on various timeframes;
3. Determining the relationship between previous values and past performance and its effect on future performance;
4. Can alert to changes in trend direction in advance (you may see high, low or close turn negative before others, signifying that weakness is beginning to materialize in an uptrend, or inverse in a downtrend (value changes positive)).
Customizability:
SMA: The autoregression data is smoothed by a 3 period lookback. You can change this if you want, but in order for the indicator to present the true trading range, it is recommended to leave it at <= 3.
Lookback Length: This is the length of the lookback period for the autoregression and autocorrelation functions.
Transparency settings: You can adjust the transparency of the clouds manually.
Timeframe: You can adjust the timeframe, as explained above, to display the timeframe of interest. When you adjust the timeframe, the data will all reflect that timeframe and not necessarily the current TF you have open (i.e. you select 30 minutes while viewing it on the 5 minute, it will show the data for the 30 minute TF period).
Video Tutorial:
I have prepared a video outlining the indicator and also explaining the theory of autoregression/correlation. You can find it below:
Let me know any comments, questions or suggestions below.
Thank you for taking the time to read/watch and check out this indicator.
Safe trades everyone!
Adaptive Candlestick Pattern Recognition System█ INTRODUCTION
Nearly three years in the making, intermittently worked on in the few spare hours of weekends and time off, this is a passion project I undertook to flesh out my skills as a computer programmer. This script currently recognizes 85 different candlestick patterns ranging from one to five candles in length. It also performs statistical analysis on those patterns to determine prior performance and changes the coloration of those patterns based on that performance. In searching TradingView's script library for scripts similar to this one, I had found a handful. However, when I reviewed the ones which were open source, I did not see many that truly captured the power of PineScrypt or leveraged the way it works to create efficient and reliable code; one of the main driving factors for releasing this 5,000+ line behemoth open sourced.
Please take the time to review this description and source code to utilize this script to its fullest potential.
█ CONCEPTS
This script covers the following topics: Candlestick Theory, Trend Direction, Higher Timeframes, Price Analysis, Statistic Analysis, and Code Design.
Candlestick Theory - This script focuses solely on the concept of Candlestick Theory: arrangements of candlesticks may form certain patterns that can potentially influence the future price action of assets which experience those patterns. A full list of patterns (grouped by pattern length) will be in its own section of this description. This script contains two modes of operation for identifying candlestick patterns, 'CLASSIC' and 'BREAKOUT'.
CLASSIC: In this mode, candlestick patterns will be identified whenever they appear. The user has a wide variety of inputs to manipulate that can change how certain patterns are identified and even enable alerts to notify themselves when these patterns appear. Each pattern selected to appear will have their Profit or Loss (P/L) calculated starting from the first candle open succeeding the pattern to a candle close specified some number of candles ahead. These P/L calculations are then collected for each pattern, and split among partitions of prior price action of the asset the script is currently applied to (more on that in Higher Timeframes ).
BREAKOUT: In this mode, P/L calculations are held off until a breakout direction has been confirmed. The user may specify the number of candles ahead of a pattern's appearance (from one to five) that a pattern has to confirm a breakout in either an upward or downward direction. A breakout is constituted when there is a candle following the appearance of the pattern that closes above/at the highest high of the pattern, or below/at its lowest low. Only then will percent return calculations be performed for the pattern that's been identified, and these percent returns are broken up not only by the partition they had appeared in but also by the breakout direction itself. Patterns which do not breakout in either direction will be ignored, along with having their labels deleted.
In both of these modes, patterns may be overridden. Overrides occur when a smaller pattern has been detected and ends up becoming one (or more) of the candles of a larger pattern. A key example of this would be the Bearish Engulfing and the Three Outside Down patterns. A Three Outside Down necessitates a Bearish Engulfing as the first two candles in it, while the third candle closes lower. When a pattern is overridden, the return for that pattern will no longer be tracked. Overrides will not occur if the tail end of a larger pattern occurs at the beginning of a smaller pattern (Ex: a Bullish Engulfing occurs on the third candle of a Three Outside Down and the candle immediately following that pattern, the Three Outside Down pattern will not be overridden).
Important Functionality Note: These patterns are only searched for at the most recently closed candle, not on the currently closing candle, which creates an offset of one for this script's execution. (SEE LIMITATIONS)
Trend Direction - Many of the patterns require a trend direction prior to their appearance. Noting TradingView's own publication of candlestick patterns, I utilize a similar method for determining trend direction. Moving Averages are used to determine which trend is currently taking place for candlestick patterns to be sought out. The user has access to two Moving Averages which they may individually modify the following for each: Moving Average type (list of 9), their length, width, source values, and all variables associated with two special Moving Averages (Least Squares and Arnaud Legoux).
There are 3 settings for these Moving Averages, the first two switch between the two Moving Averages, and the third uses both. When using individual Moving Averages, the user may select a 'price point' to compare against the Moving Average (default is close). This price point is compared to the Moving Average at the candles prior to the appearance of candle patterns. Meaning: The close compared to the Moving Average two candles behind determines the trend direction used for Candlestick Analysis of one candle patterns; three candles behind for two candle patterns and so on. If the selected price point is above the Moving Average, then the current trend is an 'uptrend', 'downtrend' otherwise.
The third setting using both Moving Averages will compare the lengths of each, and trend direction is determined by the shorter Moving Average compared to the longer one. If the shorter Moving Average is above the longer, then the current trend is an 'uptrend', 'downtrend' otherwise. If the lengths of the Moving Averages are the same, or both Moving Averages are Symmetrical, then MA1 will be used by default. (SEE LIMITATIONS)
Higher Timeframes - This script employs the use of Higher Timeframes with a few request.security calls. The purpose of these calls is strictly for the partitioning of an asset's chart, splitting the returns of patterns into three separate groups. The four inputs in control of this partitioning split the chart based on: A given resolution to grab values from, the length of time in that resolution, and 'Upper' and 'Lower Limits' which split the trading range provided by that length of time in that resolution that forms three separate groups. The default values for these four inputs will partition the current chart by the yearly high-low range where: the 'Upper' partition is the top 20% of that trading range, the 'Middle' partition is 80% to 33% of the trading range, and the 'Lower' partition covers the trading range within 33% of the yearly low.
Patterns which are identified by this script will have their returns grouped together based on which partition they had appeared in. For example, a Bullish Engulfing which occurs within a third of the yearly low will have its return placed separately from a Bullish Engulfing that occurred within 20% of the yearly high. The idea is that certain patterns may perform better or worse depending on when they had occurred during an asset's trading range.
Price Analysis - Price Analysis is a major part of this script's functionality as it can fundamentally change how patterns are shown to the user. The settings related to Price Analysis include setting the number of candles ahead of a pattern's appearance to determine the return of that pattern. In 'BREAKOUT' mode, an additional setting allows the user to specify where the P/L calculation will begin for a pattern that had appeared and confirmed. (SEE LIMITATIONS)
The calculation for percent returns of patterns is illustrated with the following pseudo-code (CLASSIC mode, this is a simplified version of the actual code):
type patternObj
int ID
int partition
type returnsArray
float returns
// No pattern found = na returned
patternObj TEST_VAL = f_FindPattern()
priorTestVal = TEST_VAL
if not na( priorTestVal )
pnlMatrixRow = priorTestVal.ID
pnlMatrixCol = priorTestVal.partition
matrixReturn = matrix.get(PERCENT_RETURNS, pnlMatrixRow, pnlMatrixCol)
percentReturn = ( (close - open ) / open ) * 100%
array.push(matrixReturn.returns, percentReturn)
Statistic Analysis - This script uses Pine's built-in array functions to conduct the Statistic Analysis for patterns. When a pattern is found and its P/L calculation is complete, its return is added to a 'Return Array' User-Defined-Type that contains numerous fields which retain information on a pattern's prior performance. The actual UDT is as follows:
type returnArray
float returns = na
int size = 0
float avg = 0
float median = 0
float stdDev = 0
int polarities = na
All values within this UDT will be updated when a return is added to it (some based on user input). The array.avg , array.median and array.stdev will be ran and saved into their respective fields after a return is placed in the 'returns' array. The 'polarities' integer array is what will be changed based on user input. The user specifies two different percentages that declare 'Positive' and 'Negative' returns for patterns. When a pattern returns above, below, or in between these two values, different indices of this array will be incremented to reflect the kind of return that pattern had just experienced.
These values (plus the full name, partition the pattern occurred in, and a 95% confidence interval of expected returns) will be displayed to the user on the tooltip of the labels that identify patterns. Simply scroll over the pattern label to view each of these values.
Code Design - Overall this script is as much of an art piece as it is functional. Its design features numerous depictions of ASCII Art that illustrate what is being attempted by the functions that identify patterns, and an incalculable amount of time was spent rewriting portions of code to improve its efficiency. Admittedly, this final version is nearly 1,000 lines shorter than a previous version (one which took nearly 30 seconds after compilation to run, and didn't do nearly half of what this version does). The use of UDTs, especially the 'patternObj' one crafted and redesigned from the Hikkake Hunter 2.0 I published last month, played a significant role in making this script run efficiently. There is a slight rigidity in some of this code mainly around pattern IDs which are responsible for displaying the abbreviation for patterns (as well as the full names under the tooltips, and the matrix row position for holding returns), as each is hard-coded to correspond to that pattern.
However, one thing I would like to mention is the extensive use of global variables for pattern detection. Many scripts I had looked over for ideas on how to identify candlestick patterns had the same idea; break the pattern into a set of logical 'true/false' statements derived from historically referencing candle OHLC values. Some scripts which identified upwards of 20 to 30 patterns would reference Pine's built-in OHLC values for each pattern individually, potentially requesting information from TradingView's servers numerous times that could easily be saved into a variable for re-use and only requested once per candle (what this script does).
█ FEATURES
This script features a massive amount of switches, options, floating point values, detection settings, and methods for identifying/tailoring pattern appearances. All modifiable inputs for patterns are grouped together based on the number of candles they contain. Other inputs (like those for statistics settings and coloration) are grouped separately and presented in a way I believe makes the most sense.
Not mentioned above is the coloration settings. One of the aims of this script was to make patterns visually signify their behavior to the user when they are identified. Each pattern has its own collection of returns which are analyzed and compared to the inputs of the user. The user may choose the colors for bullish, neutral, and bearish patterns. They may also choose the minimum number of patterns needed to occur before assigning a color to that pattern based on its behavior; a color for patterns that have not met this minimum number of occurrences yet, and a color for patterns that are still processing in BREAKOUT mode.
There are also an additional three settings which alter the color scheme for patterns: Statistic Point-of-Reference, Adaptive coloring, and Hard Limiting. The Statistic Point-of-Reference decides which value (average or median) will be compared against the 'Negative' and 'Positive Return Tolerance'(s) to guide the coloration of the patterns (or for Adaptive Coloring, the generation of a color gradient).
Adaptive Coloring will have this script produce a gradient that patterns will be colored along. The more bullish or bearish a pattern is, the further along the gradient those patterns will be colored starting from the 'Neutral' color (hard lined at the value of 0%: values above this will be colored bullish, bearish otherwise). When Adaptive Coloring is enabled, this script will request the highest and lowest values (these being the Statistic Point-of-Reference) from the matrix containing all returns and rewrite global variables tied to the negative and positive return tolerances. This means that all patterns identified will be compared with each other to determine bullish/bearishness in Adaptive Coloring.
Hard Limiting will prevent these global variables from being rewritten, so patterns whose Statistic Point-of-Reference exceed the return tolerances will be fully colored the bullish or bearish colors instead of a generated gradient color. (SEE LIMITATIONS)
Apart from the Candle Detection Modes (CLASSIC and BREAKOUT), there's an additional two inputs which modify how this script behaves grouped under a "MASTER DETECTION SETTINGS" tab. These two "Pattern Detection Settings" are 'SWITCHBOARD' and 'TARGET MODE'.
SWITCHBOARD: Every single pattern has a switch that is associated with its detection. When a switch is enabled, the code which searches for that pattern will be run. With the Pattern Detection Setting set to this, all patterns that have their switches enabled will be sought out and shown.
TARGET MODE: There is an additional setting which operates on top of 'SWITCHBOARD' that singles out an individual pattern the user specifies through a drop down list. The names of every pattern recognized by this script will be present along with an identifier that shows the number of candles in that pattern (Ex: " (# candles)"). All patterns enabled in the switchboard will still have their returns measured, but only the pattern selected from the "Target Pattern" list will be shown. (SEE LIMITATIONS)
The vast majority of other features are held in the one, two, and three candle pattern sections.
For one-candle patterns, there are:
3 — Settings related to defining 'Tall' candles:
The number of candles to sample for previous candle-size averages.
The type of comparison done for 'Tall' Candles: Settings are 'RANGE' and 'BODY'.
The 'Tolerance' for tall candles, specifying what percent of the 'average' size candles must exceed to be considered 'Tall'.
When 'Tall Candle Setting' is set to RANGE, the high-low ranges are what the current candle range will be compared against to determine if a candle is 'Tall'. Otherwise the candle bodies (absolute value of the close - open) will be compared instead. (SEE LIMITATIONS)
Hammer Tolerance - How large a 'discarded wick' may be before it disqualifies a candle from being a 'Hammer'.
Discarded wicks are compared to the size of the Hammer's candle body and are dependent upon the body's center position. Hammer bodies closer to the high of the candle will have the upper wick used as its 'discarded wick', otherwise the lower wick is used.
9 — Doji Settings, some pulled from an old Doji Hunter I made a while back:
Doji Tolerance - How large the body of a candle may be compared to the range to be considered a 'Doji'.
Ignore N/S Dojis - Turns off Trend Direction for non-special Dojis.
GS/DF Doji Settings - 2 Inputs that enable and specify how large wicks that typically disqualify Dojis from being 'Gravestone' or 'Dragonfly' Dojis may be.
4 Settings related to 'Long Wick Doji' candles detailed below.
A Tolerance for 'Rickshaw Man' Dojis specifying how close the center of the body must be to the range to be valid.
The 4 settings the user may modify for 'Long Legged' Dojis are: A Sample Base for determining the previous average of wicks, a Sample Length specifying how far back to look for these averages, a Behavior Setting to define how 'Long Legged' Dojis are recognized, and a tolerance to specify how large in comparison to the prior wicks a Doji's wicks must be to be considered 'Long Legged'.
The 'Sample Base' list has two settings:
RANGE: The wicks of prior candles are compared to their candle ranges and the 'wick averages' will be what the average percent of ranges were in the sample.
WICKS: The size of the wicks themselves are averaged and returned for comparing against the current wicks of a Doji.
The 'Behavior' list has three settings:
ONE: Only one wick length needs to exceed the average by the tolerance for a Doji to be considered 'Long Legged'.
BOTH: Both wick lengths need to exceed the average of the tolerance of their respective wicks (upper wicks are compared to upper wicks, lower wicks compared to lower) to be considered 'Long Legged'.
AVG: Both wicks and the averages of the previous wicks are added together, divided by two, and compared. If the 'average' of the current wicks exceeds this combined average of prior wicks by the tolerance, then this would constitute a valid 'Long Legged' Doji. (For Dojis in general - SEE LIMITATIONS)
The final input is one related to candle patterns which require a Marubozu candle in them. The two settings for this input are 'INCLUSIVE' and 'EXCLUSIVE'. If INCLUSIVE is selected, any opening/closing variant of Marubozu candles will be allowed in the patterns that require them.
For two-candle patterns, there are:
2 — Settings which define 'Engulfing' parameters:
Engulfing Setting - Two options, RANGE or BODY which sets up how one candle may 'engulf' the previous.
Inclusive Engulfing - Boolean which enables if 'engulfing' candles can be equal to the values needed to 'engulf' the prior candle.
For the 'Engulfing Setting':
RANGE: If the second candle's high-low range completely covers the high-low range of the prior candle, this is recognized as 'engulfing'.
BODY: If the second candle's open-close completely covers the open-close of the previous candle, this is recognized as 'engulfing'. (SEE LIMITATIONS)
4 — Booleans specifying different settings for a few patterns:
One which allows for 'opens within body' patterns to let the second candle's open/close values match the prior candles' open/close.
One which forces 'Kicking' patterns to have a gap if the Marubozu setting is set to 'INCLUSIVE'.
And Two which dictate if the individual candles in 'Stomach' patterns need to be 'Tall'.
8 — Floating point values which affect 11 different patterns:
One which determines the distance the close of the first candle in a 'Hammer Inverted' pattern must be to the low to be considered valid.
One which affects how close the opens/closes need to be for all 'Lines' patterns (Bull/Bear Meeting/Separating Lines).
One that allows some leeway with the 'Matching Low' pattern (gives a small range the second candle close may be within instead of needing to match the previous close).
Three tolerances for On Neck/In Neck patterns (2 and 1 respectively).
A tolerance for the Thrusting pattern which give a range the close the second candle may be between the midpoint and close of the first to be considered 'valid'.
A tolerance for the two Tweezers patterns that specifies how close the highs and lows of the patterns need to be to each other to be 'valid'.
The first On Neck tolerance specifies how large the lower wick of the first candle may be (as a % of that candle's range) before the pattern is invalidated. The second tolerance specifies how far up the lower wick to the close the second candle's close may be for this pattern. The third tolerance for the In Neck pattern determines how far into the body of the first candle the second may close to be 'valid'.
For the remaining patterns (3, 4, and 5 candles), there are:
3 — Settings for the Deliberation pattern:
A boolean which forces the open of the third candle to gap above the close of the second.
A tolerance which changes the proximity of the third candle's open to the second candle's close in this pattern.
A tolerance that sets the maximum size the third candle may be compared to the average of the first two candles.
One boolean value for the Two Crows patterns (standard and Upside Gapping) that forces the first two candles in the patterns to completely gap if disabled (candle 1's close < candle 2's low).
10 — Floating point values for the remaining patterns:
One tolerance for defining how much the size of each candle in the Identical Black Crows pattern may deviate from the average of themselves to be considered valid.
One tolerance for setting how close the opens/closes of certain three candle patterns may be to each other's opens/closes.*
Three floating point values that affect the Three Stars in the South pattern.
One tolerance for the Side-by-Side patterns - looks at the second and third candle closes.
One tolerance for the Stick Sandwich pattern - looks at the first and third candle closes.
A floating value that sizes the Concealing Baby Swallow pattern's 3rd candle wick.
Two values for the Ladder Bottom pattern which define a range that the third candle's wick size may be.
* This affects the Three Black Crows (non-identical) and Three White Soldiers patterns, each require the opens and closes of every candle to be near each other.
The first tolerance of the Three Stars in the South pattern affects the first candle body's center position, and defines where it must be above to be considered valid. The second tolerance specifies how close the second candle must be to this same position, as well as the deviation the ratio the candle body to its range may be in comparison to the first candle. The third restricts how large the second candle range may be in comparison to the first (prevents this pattern from being recognized if the second candle is similar to the first but larger).
The last two floating point values define upper and lower limits to the wick size of a Ladder Bottom's fourth candle to be considered valid.
█ HOW TO USE
While there are many moving parts to this script, I attempted to set the default values with what I believed may help identify the most patterns within reasonable definitions. When this script is applied to a chart, the Candle Detection Mode (along with the BREAKOUT settings) and all candle switches must be confirmed before patterns are displayed. All switches are on by default, so this gives the user an opportunity to pick which patterns to identify first before playing around in the settings.
All of the settings/inputs described above are meant for experimentation. I encourage the user to tweak these values at will to find which set ups work best for whichever charts they decide to apply these patterns to.
Refer to the patterns themselves during experimentation. The statistic information provided on the tooltips of the patterns are meant to help guide input decisions. The breadth of candlestick theory is deep, and this was an attempt at capturing what I could in its sea of information.
█ LIMITATIONS
DISCLAIMER: While it may seem a bit paradoxical that this script aims to use past performance to potentially measure future results, past performance is not indicative of future results . Markets are highly adaptive and often unpredictable. This script is meant as an informational tool to show how patterns may behave. There is no guarantee that confidence intervals (or any other metric measured with this script) are accurate to the performance of patterns; caution must be exercised with all patterns identified regardless of how much information regarding prior performance is available.
Candlestick Theory - In the name, Candlestick Theory is a theory , and all theories come with their own limits. Some patterns identified by this script may be completely useless/unprofitable/unpredictable regardless of whatever combination of settings are used to identify them. However, if I truly believed this theory had no merit, this script would not exist. It is important to understand that this is a tool meant to be utilized with an array of others to procure positive (or negative, looking at you, short sellers ) results when navigating the complex world of finance.
To address the functionality note however, this script has an offset of 1 by default. Patterns will not be identified on the currently closing candle, only on the candle which has most recently closed. Attempting to have this script do both (offset by one or identify on close) lead to more trouble than it was worth. I personally just want users to be aware that patterns will not be identified immediately when they appear.
Trend Direction - Moving Averages - There is a small quirk with how MA settings will be adjusted if the user inputs two moving averages of the same length when the "MA Setting" is set to 'BOTH'. If Moving Averages have the same length, this script will default to only using MA 1 regardless of if the types of Moving Averages are different . I will experiment in the future to alleviate/reduce this restriction.
Price Analysis - BREAKOUT mode - With how identifying patterns with a look-ahead confirmation works, the percent returns for patterns that break out in either direction will be calculated on the same candle regardless of if P/L Offset is set to 'FROM CONFIRMATION' or 'FROM APPEARANCE'. This same issue is present in the Hikkake Hunter script mentioned earlier. This does not mean the P/L calculations are incorrect , the offset for the calculation is set by the number of candles required to confirm the pattern if 'FROM APPEARANCE' is selected. It just means that these two different P/L calculations will complete at the same time independent of the setting that's been selected.
Adaptive Coloring/Hard Limiting - Hard Limiting is only used with Adaptive Coloring and has no effect outside of it. If Hard Limiting is used, it is recommended to increase the 'Positive' and 'Negative' return tolerance values as a pattern's bullish/bearishness may be disproportionately represented with the gradient generated under a hard limit.
TARGET MODE - This mode will break rules regarding patterns that are overridden on purpose. If a pattern selected in TARGET mode would have otherwise been absorbed by a larger pattern, it will have that pattern's percent return calculated; potentially leading to duplicate returns being included in the matrix of all returns recognized by this script.
'Tall' Candle Setting - This is a wide-reaching setting, as approximately 30 different patterns or so rely on defining 'Tall' candles. Changing how 'Tall' candles are defined whether by the tolerance value those candles need to exceed or by the values of the candle used for the baseline comparison (RANGE/BODY) can wildly affect how this script functions under certain conditions. Refer to the tooltip of these settings for more information on which specific patterns are affected by this.
Doji Settings - There are roughly 10 or so two to three candle patterns which have Dojis as a part of them. If all Dojis are disabled, it will prevent some of these larger patterns from being recognized. This is a dependency issue that I may address in the future.
'Engulfing' Setting - Functionally, the two 'Engulfing' settings are quite different. Because of this, the 'RANGE' setting may cause certain patterns that would otherwise be valid under textbook and online references/definitions to not be recognized as such (like the Upside Gap Two Crows or Three Outside down).
█ PATTERN LIST
This script recognizes 85 patterns upon initial release. I am open to adding additional patterns to it in the future and any comments/suggestions are appreciated. It recognizes:
15 — 1 Candle Patterns
4 Hammer type patterns: Regular Hammer, Takuri Line, Shooting Star, and Hanging Man
9 Doji Candles: Regular Dojis, Northern/Southern Dojis, Gravestone/Dragonfly Dojis, Gapping Up/Down Dojis, and Long-Legged/Rickshaw Man Dojis
White/Black Long Days
32 — 2 Candle Patterns
4 Engulfing type patterns: Bullish/Bearish Engulfing and Last Engulfing Top/Bottom
Dark Cloud Cover
Bullish/Bearish Doji Star patterns
Hammer Inverted
Bullish/Bearish Haramis + Cross variants
Homing Pigeon
Bullish/Bearish Kicking
4 Lines type patterns: Bullish/Bearish Meeting/Separating Lines
Matching Low
On/In Neck patterns
Piercing pattern
Shooting Star (2 Lines)
Above/Below Stomach patterns
Thrusting
Tweezers Top/Bottom patterns
Two Black Gapping
Rising/Falling Window patterns
29 — 3 Candle Patterns
Bullish/Bearish Abandoned Baby patterns
Advance Block
Collapsing Doji Star
Deliberation
Upside/Downside Gap Three Methods patterns
Three Inside/Outside Up/Down patterns (4 total)
Bullish/Bearish Side-by-Side patterns
Morning/Evening Star patterns + Doji variants
Stick Sandwich
Downside/Upside Tasuki Gap patterns
Three Black Crows + Identical variation
Three White Soldiers
Three Stars in the South
Bullish/Bearish Tri-Star patterns
Two Crows + Upside Gap variant
Unique Three River Bottom
3 — 4 Candle Patterns
Concealing Baby Swallow
Bullish/Bearish Three Line Strike patterns
6 — 5 Candle Patterns
Bullish/Bearish Breakaway patterns
Ladder Bottom
Mat Hold
Rising/Falling Three Methods patterns
█ WORKS CITED
Because of the amount of time needed to complete this script, I am unable to provide exact dates for when some of these references were used. I will also not provide every single reference, as citing a reference for each individual pattern and the place it was reviewed would lead to a bibliography larger than this script and its description combined. There were five major resources I used when building this script, one book, two websites (for various different reasons including patterns, moving averages, and various other articles of information), various scripts from TradingView's public library (including TradingView's own source code for *all* candle patterns ), and PineScrypt's reference manual.
Bulkowski, Thomas N. Encyclopedia of Candlestick Patterns . Hoboken, New Jersey: John Wiley & Sons Inc., 2008. E-book (google books).
Various. Numerous webpages. CandleScanner . 2023. online. Accessed 2020 - 2023.
Various. Numerous webpages. Investopedia . 2023. online. Accessed 2020 - 2023.
█ AKNOWLEDGEMENTS
I want to take the time here to thank all of my friends and family, both online and in real life, for the support they've given me over the last few years in this endeavor. My pets who tried their hardest to keep me from completing it. And work for the grit to continue pushing through until this script's completion.
This belongs to me just as much as it does anyone else. Whether you are an institutional trader, gold bug hedging against the dollar, retail ape who got in on a squeeze, or just parents trying to grow their retirement/save for the kids. This belongs to everyone.
Private Beta for new features to be tested can be found here .
Vires In Numeris
Rangemeter [theEccentricTrader]█ OVERVIEW
This indicator simply displays candle and peak to trough ranges in points or pips, depending on the symbol type, in a table, which can be repositioned and resized at the user's discretion.
█ CONCEPTS
Green and Red Candles
• A green candle is one that closes with a close price equal to or above the price it opened.
• A red candle is one that closes with a close price that is lower than the price it opened.
Open Green and Red Candles
• An open green candle is one that has a close price equal to or above the price it opened, but has not yet closed to confirm the condition.
• An open red candle is one that has a close price lower than the price it opened, but has not yet closed to confirm the condition.
Swing Highs and Swing Lows
• A swing high is a green candle or series of consecutive green candles followed by a single red candle to complete the swing and form the peak.
• A swing low is a red candle or series of consecutive red candles followed by a single green candle to complete the swing and form the trough.
Peak and Trough Prices (Basic)
• The peak price of a complete swing high is the high price of either the red candle that completes the swing high or the high price of the preceding green candle, depending on which is higher.
• The trough price of a complete swing low is the low price of either the green candle that completes the swing low or the low price of the preceding red candle, depending on which is lower.
Historic Peaks and Troughs
The current, or most recent, peak and trough occurrences are referred to as occurrence zero. Previous peak and trough occurrences are referred to as historic and ordered numerically from right to left, with the most recent historic peak and trough occurrences being occurrence one.
Range
The range is simply the difference between the current peak and current trough prices, generally expressed in terms of points or pips.
Open Range
An open range is here defined as one that is forming but has not yet completed. For example, a swing low that has an open green candle proceeding a red candle or series of red candles. Or a swing high that has an open red candle proceeding a green candle or series of green candles.
The table will only display the open range under the aforementioned circumstances, otherwise it will display the current, or previous, range.
█ FEATURES
Inputs
• Show Candle Ranges
• Show Largest and Smallest Candle Ranges
• Average Candle Range Lookback
• Show Ranges
• Show Largest and Smallest Ranges
• Average Range Lookback
• Position
• Text Size
█ HOW TO USE
The indicator can be used for strategy filtering and development, gauging current market conditions versus historic and helping to make more informed discretionary trading decisions. It can also be used like my Wavemeter indicator to objectively set the angle and projection ratio for my Fan Projections and Parallel Projections indicators.
█ LIMITATIONS
Some higher timeframe candles on tickers with larger lookbacks such as the DXY , do not actually contain all the open, high, low and close (OHLC) data at the beginning of the chart. Instead, they use the close price for open, high and low prices. So, while we can determine whether the close price is higher or lower than the preceding close price, there is no way of knowing what actually happened intra-bar for these candles. And by default candles that close at the same price as the open price, will be counted as green. You can avoid this problem by ensuring the lookback for the average range does not reach as far back as the start of the chart. If you are unsure about the candle count you can use my Candle Counter indicator to find out how many candles are displayed on the chart.
The green and red candle calculations are based solely on differences between open and close prices, as such I have made no attempt to account for green candles that gap lower and close below the close price of the preceding candle, or red candles that gap higher and close above the close price of the preceding candle. I can only recommend using 24-hour markets, if and where possible, as there are far fewer gaps and, generally, more data to work with. Alternatively, you can replace the scenarios with your own logic to account for the gap anomalies, if you are feeling up to the challenge.
It is also worth noting that the lookback will be limited to your Trading View subscription plan. Premium users get 20,000 candles worth of data, pro+ and pro users get 10,000, and basic users get 5,000.
Pivot Highs&lows: Short/Medium/Long-term + Spikeyness FilterShows Pivot Highs & Lows defined or 'Graded' on a fractal basis: Short-term, medium-term and long-term. Also applies 'Spikeyness' condition by default to filter-out weak/rounded pivots
ES1! 4hr chart (CME) shown above, with lookback = 15; clearly identifying the major highs & lows on the basis of how they are fractally 'nested' within lesser Pivots.
-- in the above chart Short term pivot highs (STH) are simply represented by green 'ʌ', and short-term pivot lows (STL) are simply represented by orange 'v'.
//Basics: (as applying to pivot highs, the following is reversed for pivot lows)
-Short term highs (STH) are simple pivot highs, albeit refined from standard with the 'spikeyness' filter.
-Medium-term highs (MTH) are defined as having a lower STH on either side of them.
-Long-term highs (LTH) are defined as having a lower MTH on either side of them.
//Purpose:
-Education: Quick and easy visualization of the strength or importance of a pivot high or low; a way of grading them based on their larger context.
-Backtesting: use in combination with other trading methods when backtesting to see the relative significance and price sensitivity of LTHs/LTLs compared to lower grade highs and lows.
//Settings:
-Choose Pivot lookback/lookforward bars: One setting, the basis from which all further pivot calculations are done.
-Toggle on/off 'Spikeyness' condition to filter-out weak/rounded/unimpressive pivot highs or lows (default is ON).
-Toggle on/off each of STH, MTH, LTH, STL, MTL, LTL; and choose label text-styles/colors/sizes independently.
-Set text Vertically, horizonally, or simply use 'ʌ' or 'v' symbols if you want to declutter your chart.
//Usage notes:
-Pivots take time to print (lookback bars must have elapsed before confirmation). Fractally nested pivots as here (i.e. a LTH), take even longer to print/confirm, so please be patient.
-Works across timeframes & Assets. Different timeframes may require slightly tweaked lookback/forward settings for optimal use; default is 15 bars.
Example usage with just symbolic labels short-term, med-term, long-term with 1x, 2x and 3x ʌ/v respectively:
Return Line Downtrends [theEccentricTrader]█ OVERVIEW
This indicator simply plots multi-part return line downtrends and should be used in conjunction with my Return Line Uptrends, Downtrends and Uptrends indicators as a visual aid to my Trend Counter indicator.
█ CONCEPTS
Green and Red Candles
• A green candle is one that closes with a high price equal to or above the price it opened.
• A red candle is one that closes with a low price that is lower than the price it opened.
Swing Highs and Swing Lows
• A swing high is a green candle or series of consecutive green candles followed by a single red candle to complete the swing and form the peak.
• A swing low is a red candle or series of consecutive red candles followed by a single green candle to complete the swing and form the trough.
Peak and Trough Prices (Basic)
• The peak price of a complete swing high is the high price of either the red candle that completes the swing high or the high price of the preceding green candle, depending on which is higher.
• The trough price of a complete swing low is the low price of either the green candle that completes the swing low or the low price of the preceding red candle, depending on which is lower.
Upper Trends
• A return line uptrend is formed when the current peak price is higher than the preceding peak price.
• A downtrend is formed when the current peak price is lower than the preceding peak price.
• A double-top is formed when the current peak price is equal to the preceding peak price.
Lower Trends
• An uptrend is formed when the current trough price is higher than the preceding trough price.
• A return line downtrend is formed when the current trough price is lower than the preceding trough price.
• A double-bottom is formed when the current trough price is equal to the preceding trough price.
Muti-Part Upper and Lower Trends
• A multi-part return line uptrend begins with the formation of a new return line uptrend, or higher peak, and continues until a new downtrend, or lower peak, completes the trend.
• A multi-part downtrend begins with the formation of a new downtrend, or lower peak, and continues until a new return line uptrend, or higher peak, completes the trend.
• A multi-part uptrend begins with the formation of a new uptrend, or higher trough, and continues until a new return line downtrend, or lower trough, completes the trend.
• A multi-part return line downtrend begins with the formation of a new return line downtrend, or lower trough, and continues until a new uptrend, or higher trough, completes the trend.
█ FEATURES
Plots
Red down-arrows, with the number of the trend part, denote return line downtrends.
█ LIMITATIONS
Some higher timeframe candles on tickers with larger lookbacks such as the DXY , do not actually contain all the open, high, low and close (OHLC) data at the beginning of the chart. Instead, they use the close price for open, high and low prices. So, while we can determine whether the close price is higher or lower than the preceding close price, there is no way of knowing what actually happened intra-bar for these candles. And by default candles that close at the same price as the open price, will be counted as green.
The green and red candle calculations are based solely on differences between open and close prices, as such I have made no attempt to account for green candles that gap lower and close below the close price of the preceding candle, or red candles that gap higher and close above the close price of the preceding candle. I can only recommend using 24-hour markets, if and where possible, as there are far fewer gaps and, generally, more data to work with. Alternatively, you can replace the scenarios with your own logic to account for the gap anomalies, if you are feeling up to the challenge.
Uptrends [theEccentricTrader]█ OVERVIEW
This indicator simply plots multi-part uptrends and should be used in conjunction with my Return Line Uptrends, Downtrends and Return Line Downtrends indicators as a visual aid to my Trend Counter indicator.
█ CONCEPTS
Green and Red Candles
• A green candle is one that closes with a high price equal to or above the price it opened.
• A red candle is one that closes with a low price that is lower than the price it opened.
Swing Highs and Swing Lows
• A swing high is a green candle or series of consecutive green candles followed by a single red candle to complete the swing and form the peak.
• A swing low is a red candle or series of consecutive red candles followed by a single green candle to complete the swing and form the trough.
Peak and Trough Prices (Basic)
• The peak price of a complete swing high is the high price of either the red candle that completes the swing high or the high price of the preceding green candle, depending on which is higher.
• The trough price of a complete swing low is the low price of either the green candle that completes the swing low or the low price of the preceding red candle, depending on which is lower.
Upper Trends
• A return line uptrend is formed when the current peak price is higher than the preceding peak price.
• A downtrend is formed when the current peak price is lower than the preceding peak price.
• A double-top is formed when the current peak price is equal to the preceding peak price.
Lower Trends
• An uptrend is formed when the current trough price is higher than the preceding trough price.
• A return line downtrend is formed when the current trough price is lower than the preceding trough price.
• A double-bottom is formed when the current trough price is equal to the preceding trough price.
Muti-Part Upper and Lower Trends
• A multi-part return line uptrend begins with the formation of a new return line uptrend, or higher peak, and continues until a new downtrend, or lower peak, completes the trend.
• A multi-part downtrend begins with the formation of a new downtrend, or lower peak, and continues until a new return line uptrend, or higher peak, completes the trend.
• A multi-part uptrend begins with the formation of a new uptrend, or higher trough, and continues until a new return line downtrend, or lower trough, completes the trend.
• A multi-part return line downtrend begins with the formation of a new return line downtrend, or lower trough, and continues until a new uptrend, or higher trough, completes the trend.
█ FEATURES
Plots
Green up-arrows, with the number of the trend part, denote uptrends.
█ LIMITATIONS
Some higher timeframe candles on tickers with larger lookbacks such as the DXY , do not actually contain all the open, high, low and close (OHLC) data at the beginning of the chart. Instead, they use the close price for open, high and low prices. So, while we can determine whether the close price is higher or lower than the preceding close price, there is no way of knowing what actually happened intra-bar for these candles. And by default candles that close at the same price as the open price, will be counted as green.
The green and red candle calculations are based solely on differences between open and close prices, as such I have made no attempt to account for green candles that gap lower and close below the close price of the preceding candle, or red candles that gap higher and close above the close price of the preceding candle. I can only recommend using 24-hour markets, if and where possible, as there are far fewer gaps and, generally, more data to work with. Alternatively, you can replace the scenarios with your own logic to account for the gap anomalies, if you are feeling up to the challenge.
Downtrends [theEccentricTrader]█ OVERVIEW
This indicator simply plots multi-part downtrends and should be used in conjunction with my Return Line Uptrends, Uptrends and Return Line Downtrends indicators as a visual aid to my Trend Counter indicator.
█ CONCEPTS
Green and Red Candles
• A green candle is one that closes with a high price equal to or above the price it opened.
• A red candle is one that closes with a low price that is lower than the price it opened.
Swing Highs and Swing Lows
• A swing high is a green candle or series of consecutive green candles followed by a single red candle to complete the swing and form the peak.
• A swing low is a red candle or series of consecutive red candles followed by a single green candle to complete the swing and form the trough.
Peak and Trough Prices (Basic)
• The peak price of a complete swing high is the high price of either the red candle that completes the swing high or the high price of the preceding green candle, depending on which is higher.
• The trough price of a complete swing low is the low price of either the green candle that completes the swing low or the low price of the preceding red candle, depending on which is lower.
Upper Trends
• A return line uptrend is formed when the current peak price is higher than the preceding peak price.
• A downtrend is formed when the current peak price is lower than the preceding peak price.
• A double-top is formed when the current peak price is equal to the preceding peak price.
Lower Trends
• An uptrend is formed when the current trough price is higher than the preceding trough price.
• A return line downtrend is formed when the current trough price is lower than the preceding trough price.
• A double-bottom is formed when the current trough price is equal to the preceding trough price.
Muti-Part Upper and Lower Trends
• A multi-part return line uptrend begins with the formation of a new return line uptrend, or higher peak, and continues until a new downtrend, or lower peak, completes the trend.
• A multi-part downtrend begins with the formation of a new downtrend, or lower peak, and continues until a new return line uptrend, or higher peak, completes the trend.
• A multi-part uptrend begins with the formation of a new uptrend, or higher trough, and continues until a new return line downtrend, or lower trough, completes the trend.
• A multi-part return line downtrend begins with the formation of a new return line downtrend, or lower trough, and continues until a new uptrend, or higher trough, completes the trend.
█ FEATURES
Plots
Red down-arrows, with the number of the trend part, denote downtrends.
█ LIMITATIONS
Some higher timeframe candles on tickers with larger lookbacks such as the DXY , do not actually contain all the open, high, low and close (OHLC) data at the beginning of the chart. Instead, they use the close price for open, high and low prices. So, while we can determine whether the close price is higher or lower than the preceding close price, there is no way of knowing what actually happened intra-bar for these candles. And by default candles that close at the same price as the open price, will be counted as green.
The green and red candle calculations are based solely on differences between open and close prices, as such I have made no attempt to account for green candles that gap lower and close below the close price of the preceding candle, or red candles that gap higher and close above the close price of the preceding candle. I can only recommend using 24-hour markets, if and where possible, as there are far fewer gaps and, generally, more data to work with. Alternatively, you can replace the scenarios with your own logic to account for the gap anomalies, if you are feeling up to the challenge.
