Trend Bars Pro (HTF PO3)Hello Traders!
The innovative TRN Trend Bars Pro are designed to help traders to analyze markets in an intuitive way and provide high probability entry and exit signals. It combines three core concepts:
TRN Trend Bars to see the current trend and reversals (replaces the default chart bars)
Bar Ranges to highlight consolidations
Dynamic Trend to see the overall trend.
First, let's have a look at each of these concepts individually. Afterwards, we describe how a combination of all three gives you a crystal-clear picture of the market.
TRN Trend Bars Pro
They show bullish and bearish trends and reversals based on color coding the bars and give high probability trade opportunities with special colors. The trend analysis is based on a new algorithm that includes several different inputs:
classical and advanced bar patterns and their statistical frequency
probability distributions of price expansions after certain bar patterns
bar information such as wick length in %, overlapping of the previous bar in % and many more
historical trend and consolidation analysis
The algorithm weighs these concepts and outputs a color scheme for the chart bars or candlesticks.
Bar Types
Trend bars in green and red
Reversal Bars in blue and fuchsia
Continuation Bars in turquoise and orange
Breakout Bars in dark green and pink
Green Bars signify a sustained uptrend, indicating bullish market sentiment. On the other hand, Red Bars indicate a persistent downtrend, representing bearish market sentiment. The transition from red to green denotes a bullish trend reversal, suggesting a shift from bearish to bullish sentiment. Conversely, the shift from green to red signals a bearish trend reversal, indicating a transition from bullish to bearish sentiment. By monitoring these color changes, traders can identify potential trend reversals and make informed trading decisions.
The presence of gray and black bars indicates a neutral market state, often observed before an impending color change from red to green or green to red. These neutral bars serve as a transition phase between the previous trend and the potential reversal.
The TRN Trend Bars Pro incorporate signal bars, distinguished by their distinct colors, to offer potential buy and sell signals and deeper insights into market dynamics.
Reversal Bars
The presence of blue Reversal Bars indicates a trend reversal to the upside, while pink Reversal Bars indicate a reversal to the downside. These bars not only serve as signals for potential trend shifts but also present favorable opportunities to enter the market or increase one's position size.
Continuation Bars
In addition to the reversal bars, the indicator also includes bullish continuation bars (colored turquoise) and bearish continuation bars (colored orange). These bars act as signals for the continuation of an existing trend. Like the reversal bars, they can be utilized as entry points or opportunities to augment one's position size.
Breakout Bars
The dark green breakout bars within TRN Trend Bars Pro show a powerful breakout from a price range detected by our integrated bar range feature. They signify the continuation or potential change in a trend following a consolidation phase. As such, these bars hold dual functionality, serving as reversal signals and validating the persistence of an ongoing trend.
Bar Ranges
The bar range feature automatically finds consolidations where the price range of several consecutives bars is rather small. The detection of the bar ranges includes among other things the overlapping percentage of these bars.
How to Use Price Ranges
Here are a few ways you can use the bar ranges in your trading:
Identify Support and Resistance Levels
The price ranges can help you identify key support and resistance levels on a chart. By observing price ranges and identifying these levels, you can make more informed decisions about entering or exiting trades.
Breakout Trading
Price ranges can also provide insights into potential breakout opportunities. Breakouts occur when the price breaks out of a defined range, signaling a potential shift in market sentiment and the start of a new trend. The Color highlighted Breakout Bars from the TRN Trend Bars Pro are signaling a powerful breakout of a price range. Traders can enter positions in the direction of the breakout and set appropriate stop-loss orders to manage risk. Note that not every price range is left by a powerful breakout.
Dynamic Trend
The Dynamic Trend combines elements from standard trend strength indicators (e.g. DI-, DI+, Parabolic SAR) and volatility indicators (e.g. ATR, Standard Deviation). It produces a moving average line that adapts to changing market volatility. It is inspired by the ideas of the programmer and trader Fat Tails. The adaptive behavior provides more relevant information for traders when compared to traditional moving averages which do not consider volatility and trend strength together. This makes the Dynamic Trend completely unique, and no other moving average indicator can give you this precision.
How to use Dynamic Trend
Generally, a rising Dynamic Trend line, displayed in green, indicates that an uptrend is strong, while a falling Dynamic Trend, displayed in red, suggests that the downtrend is sharp. The Dynamic Trend turns gray when there is insufficient clarity to establish a distinct trend and especially when there is not volatility in the market.
Identify potential trade entries and exits: When used in conjunction with price action, the Dynamic Trend can provide potential trade signals. For example, if the price crosses above the Dynamic Trend, it may be a bullish sign, suggesting a potential buy entry. Conversely, if the price crosses below the Dynamic Trend, it may indicate bearish conditions and a potential sell signal.
Trend Identification and Pullback trading
Observe the Dynamic Trend's color. When it's on the rise and appears green, it indicates a bullish trend. Conversely, if it's in decline and displayed in red, it signals a bearish trend.
If Dynamic Trend is green and price pulls from above back to the Dynamic Trend, then this can be considered as a bullish signal.
If Dynamic Trend is red and price pulls from below back to the Dynamic Trend, then this can be considered as a bearish signal.
In the event of a bearish signal, such as a bearish TRN Signal Bar, and the Dynamic Trend is red, it provides additional confirmation to the bearish signal. Likewise, bullish signals gain added conviction when the Dynamic Trend is green.
Crossovers
As with other moving averages, crossovers between the Dynamic Trend and the price can be significant.
If price is crossing above the Dynamic Trend, then this can be considered as a bullish signal.
If price is crossing below the Dynamic Trend, then this can be considered as a bearish signal.
If you currently hold a position, both bullish and bearish crossovers can serve as potential exit signals. For instance, in the case of a long position, a bearish crossover can indicate a potential shift in sentiment, signaling a bearish reversal and a potential opportunity to close your long position.
Filtering Noise
Due to its adaptive nature, the Dynamic Trend can be a useful tool to filter out market noise. When the market is choppy or consolidating, the Dynamic Trend tends to remain flat and colored gray, signaling traders to potentially stay out of the market.
Stop Losses
The Dynamic Trend can also be used as a dynamic stop loss. For instance, in a long trade, traders can use the Dynamic Trend as a trailing stop, selling their position if the price crosses below the Dynamic Trend.
Combining TRN Trend Bars Pro, Bar Ranges and Dynamic Trend together
Combining all three concepts gives you a crystal-clear picture of the market. The Dynamic Trend shows you the overall trend. If price pulls back to the dynamic trend line and then price picks up the trend direction again, then the TRN Trend Bars Pro immediately switches the color to the trend direction. Therefore, you can easily identify high probability entry signals based on the bar color.
As a simple trading model, you can set the stop loss below the last swing or below a TRN signal bar (vice versa for short entries) and use 2.5 R or 3 R as target.
You can increase the success rate of the high probability TRN signal bars entries even more if they are in line with the Dynamic Trend line.
On the other hand, the TRN Bar Ranges help you to stay out of the market in case the price does not really change. As a confluence signal to stay flat in this period the dynamic trend line tends to be grey as well. If the price breaks out of the range, then the indicator prints a breakout bar which serves as a high probability entry signal.
Although it is possible to switch off any of these concepts, it is highly recommended to use all three in combination to get a crystal-clear picture of the market.
Alerts
Experience the power of our TRN Trend Bars Pro alerts, delivering real-time notifications for trend changes, price range breakouts, and signal bar formations or confirmations. Stay on top of the market with these versatile alerts, customizable to your preferred assets and timeframes.
Conclusion
While signals from TRN Trend Bars Pro can be informative, it is important to recognize that their reliability may vary. Various external factors can impact market prices, and it is essential to consider your risk tolerance and investment goals when executing trades.
Risk Disclaimer
The content, tools, scripts, articles, and educational resources offered by TRN Trading are intended solely for informational and educational purposes. Remember, past performance does not ensure future outcomes.
Trendtrading
Trend Following Parabolic Buy Sell Strategy [TradeDots]The Trend Following Parabolic Buy-Sell Strategy leverages the Parabolic SAR in combination with moving average crossovers to deliver buy and sell signals within a trend-following framework.
This strategy synthesizes proven methodologies sourced from various trading tutorials available on platforms such as YouTube and blogs, enabling traders to conduct robust backtesting on their selected trading pairs to assess the strategy's effectiveness.
HOW IT WORKS
This strategy employs four key indicators to orchestrate its trading signals:
1. Trend Alignment: It first assesses the relationship between the price and the predominant trendline to determine the directional stance—taking long positions only when the price trends above the moving average, signaling an upward market trajectory.
2. Momentum Confirmation: Subsequent to trend alignment, the strategy looks for moving average crossovers as a confirmation that the price is gaining momentum in the direction of the intended trades.
3. Signal Finalization: Finally, buy or sell signals are validated using the Parabolic SAR indicator. A long order is validated when the closing price is above the Parabolic SAR dots, and similarly, conditions are reversed for short orders.
4. Risk Management: The strategy institutes a fixed stop-loss at the moving average trendline and a take-profit level determinable by a prefixed risk-reward ratio calculated from the moving average trendline. These parameters are customizable by the users within the strategy settings.
APPLICATION
Designed for assets exhibiting pronounced directional momentum, this strategy aims to capitalize on clear trend movements conducive to achieving set take-profit targets.
As a lagging strategy that waits for multiple confirmatory signals, entry into trades might occasionally lag beyond optimal timing.
Furthermore, in periods of consolidation or sideways movement, the strategy may generate several false signals, suggesting the potential need for additional market condition filters to enhance signal accuracy during volatile phases.
DEFAULT SETUP
Commission: 0.01%
Initial Capital: $10,000
Equity per Trade: 70%
Users are advised to adjust and personalize this trading strategy to better match their individual trading preferences and style.
RISK DISCLAIMER
Trading entails substantial risk, and most day traders incur losses. All content, tools, scripts, articles, and education provided by TradeDots serve purely informational and educational purposes. Past performances are not definitive predictors of future results.
ZigZag Smart Trend [TradingFinder] Major & Minor Structured Wave🔵 Introduction
🟣 Zigzag
Zigzag is a lagging indicator; this indicator identifies points on a price chart that have more significant changes than its previous wave and then by connecting these lines to each other, it assists traders in trend detection.
This indicator reduces random price fluctuations and attempts to make the primary price trend clearer.
🟣 Pivot
Pivots are points where the price chart changes direction. Pivots, also called reversal points, form when supply and demand forces dominate one another.
Different types of technical analysis pivots can be introduced into two categories, minor pivots, and major pivots, each of which has a specific meaning in analysis.
Major Pivot : These pivots actually indicate major changes in the direction of the chart and occur at the end of trends. Analysts seeking to reach the primary analysis focus more on major pivot points. In fact, most technical analysis tools are examined and determined based on major pivots.
Minor Pivot : This type of pivot focuses more on small and subsidiary points and directions. Therefore, it occurs at the end of corrections. Analysts focusing on minor pivots represent small trends, and it should be noted that minor pivots are not suitable for use in primary technical tools.
How to identify minor and major pivots :
Minor pivots are pivots formed between two major pivots and fail to break the opposite major pivot.
Major pivots are pivots that have either successfully broken the opposite pivot or have moved more than the previous pivot of the same type.
🔵 How to use
Based on identifying pivots and drawing zigzag lines, you can have various uses for this indicator.
Identifying support and resistance levels :
Identifying Elliott Waves :
Identifying classic patterns :
Identifying pivots with higher validity :
Identifying internal and external breakouts :
Identifying trends and range areas :
Identifying pivot types along with major and minor recognition :
MHH : Major Higher High
MLH : Major Lower High
MLL : Major Lower Low
MHL : Major Higher Low
mHH : Minor Higher High
mLH : Minor Lower High
mLL : Minor Lower Low
mHL : Minor Higher Low
🔵 Settings
Pivot Period Zigzag Line : Using this input, you can determine the pivot period for identifying zigzag swings.
Show Zigzag Line : To show or not to show the zigzag line.
Zigzag Line Color : Change the color of the zigzag line.
Zigzag Line Style : Change the Style of the zigzag line.
Zigzag Line Width : Change the Width of the zigzag line.
Show Label : To show or not to show Pivot Type.
Color Label : Change the color of the Pivot Type Label.
Johnny's Trend Lines, Supports and ResistancesInspired and based on ismailcarlik's Trend Lines, Supports and Resistances.
Additions include an overall upgrade to Pinescript v5, changes in the way resistance and support levels are calculated, improved visual queues, and additional customization options.
This indicator is meticulously crafted to provide traders with visual tools for identifying trend lines, support, and resistance levels, enhancing the decision-making process in trading activities.
Features and Functionality
Trend Lines: The indicator allows users to enable or disable trend lines, adjust the number of points to check for establishing a trend, and set parameters for trend validation, including the maximum violation and exceptions for the last bars.
Support and Resistance: It offers tools to identify and visualize key support and resistance levels based on recent pivot points. This includes adjustable parameters for the maximum violations allowed and the exclusion of recent bars from the analysis.
Pivot Points: Users can define the pivot length for calculating highs and lows, which helps in marking significant pivot points that are instrumental in trend analysis.
Alerts and Notifications: The indicator is equipped with customizable alerts for trend line breaches and pivot point formations, which can be set to trigger at different frequencies based on user preference.
How It Works
Input Flexibility: Users can adjust various settings like the length of trend lines and pivot points, enabling or disabling specific features like marking pivots, and managing alert settings directly from the indicator’s input panel.
Dynamic Analysis: By analyzing the price action relative to the calculated trend lines and pivot points, the indicator dynamically identifies potential trend reversals, continuations, and significant price levels.
Visualization: It plots trend lines and marks support and resistance levels directly on the chart, with options to extend these lines and add labels for better clarity. Violated trend lines can be visually differentiated by changing their style and width.
Practical Application
Trend Line Strategy: Traders can use the trend lines to determine the strength of the current market trend and to spot potential reversal points.
Support and Resistance Strategy: By marking where the price has historically faced resistance or found support, traders can plan entry and exit points, set stop-loss orders, or identify breakout opportunities.
Pivot Points Strategy: Pivot points serve as vital indicators for intraday trading or long-term trend analysis, providing insights into potential support and resistance levels.
Customization and Alerts
Custom Alerts: Traders can set alerts for when the price crosses trend lines or when new support or resistance levels are formed, helping them stay informed of critical market movements without having to continuously monitor the charts.
Visual Customization: Users can personalize the appearance of trend lines and labels, choosing from a variety of colors and styles to match their chart setup or preferences.
"Johnny's Trend Lines, Supports and Resistances" is an essential tool for traders who rely on technical analysis, offering detailed insights and real-time updates on market conditions, trend strength, and potential price barriers.
Trend and Reversal ScannerHello Traders!
The TRN Trend and Reversal Scanner highlights in a user-friendly and easy to read table trend and reversal signals from up to 20 assets of your choosing. With it, you can efficiently monitor your preferred instruments simultaneously without jumping from one chart to the next. You will never miss a signal again. The indicator automatically finds swing-based up and down trends, bullish and bearish divergences, detects ranges and range breakouts as well as trend and reversal signals by the built-in trend detection algorithm called TRN Bars. Furthermore, you can conveniently stay updated with real-time alerts, notifying you whenever the scanner finds interesting market situations.
Feature List
Swing-based up and down trend detection
Divergence detection for any given (Custom) Indicator
Price range and breakout detection
Bar trend and reversal detection
Scanner alerts
The value of this indicator is to support traders to easily identify trend-based signals in an automated way and across many different markets at the same time. The trader saves a lot of time scanning the markets for up and down swings, divergences, consolidations and bar pattern-based trends and reversals, since finding and alerting these signals is done automatically for the trader.
For a visualization of the detected signals, you can add the TRN Bars and the Swing Suite indicator to your chart.
How does Trend Scanner work?
On the right side of the chart, you can find a table displaying the symbols monitored by the TRN Trend and Reversal Scanner for signal detection (first column). The table provides information on the status of each symbol. This visual representation allows you to quickly identify evolving signals across different symbols, helping you stay informed and make timely trading decisions.
The scanner operates specifically on the timeframe you are currently viewing, ensuring that the detected signals align precisely with your trading perspective.
In the following, we will describe the different signals displayed in the different columns of the table
Column 1 – Symbols
Column 2 – Bar Trend & Signals
Column 3 – Up & Down Swing Trend
Column 4 – Ranges & Range Breakouts
Column 5 – Bullish Divergences
Column 6 – Bearish Divergences
Bar Trend & Signals
In the second column, you can observe the status of TRN Bars, the built-in trend detection algorithm.
UP – Uptrend
DN – Downtrend
REV (Green) – Bullish Reversal Bar
REV (Red) – Bearish Reversal Bar
CON (Green) – Bullish Continuation Bar
CON (Red) – Bearish Continuation Bar
B/O (Green) – Bullish Range Breakout Bar
B/O (Red) – Bearish Range Breakout Bar
TRN Bars is designed to spot bullish and bearish trends and reversals. The trend analysis is based on a new algorithm that weights several different inputs:
classical and advanced bar patterns and their statistical frequency
probability distributions of price expansions after certain bar patterns
bar information such as wick length in %, overlapping of the previous bar in % and many more
historical trend and consolidation analysis
It provides high-probability trend continuation analysis and reversal detections.
Up and Downtrend
The second column (Trend) indicates whether the price of the asset moves within an uptrend (UP) or a downtrend (DN), as detected by our unique swing detection algorithm, on the selected timeframe.
The swing detection algorithm identifies pivot points (swings) with high accuracy. It works in real-time and does not need a look-a-head to find swings.
Ranges & Range Breakouts
The third column provides insights into the price behavior of a symbol within the selected timeframe, as analyzed by the range feature of the TRN Bars algorithm.
ACTIVE – Price moves within a price range
UP – Breakout detected
DN – Breakdown detected
UP CONF – Breakout confirmed
DN CONF – Breakdown confirmed
The bar range feature automatically finds consolidations where the price range of several consecutives bars is rather small. The detection of the bar ranges includes among other things the overlapping percentage of these bars.
Divergence Detection for any given (Custom) Indicator
The divergence detector finds with unrivaled precision bullish and bearish as well as regular and hidden divergences. The main difference compared to other divergences indicators is that this indicator finds rigorously the extreme peaks of each swing, both in price and in the corresponding indicator. This precision is unmatched and therefore this is one of the best divergences detectors.
The build in divergence detector works with any given indicator, even custom ones. In addition, there are 11 built-in indicators. Most noticeable is the cumulative delta indicator, which works astonishingly well as a divergence indicator. Full list:
External Indicator (see next section for the setup)
Awesome Oscillator (AO)
Commodity Channel Index (CCI)
Cumulative Delta Volume (CDV)
Chaikin Money Flow (CMF)
Moving Average Convergence Divergence (MACD)
Money Flow Index (MFI)
Momentum
On Balance Volume (OBV)
Relative Strength Index (RSI)
Stochastic
Williams Percentage Range (W%R)
Another highlight of the divergence detection is that it works with every indicator, even custom ones. To do this, you must add the (custom) indicator to your chart. Afterwards, simply go to the “Divergence Detection” section in the indicator settings and choose "External Indicator". If the custom indicator has one reference value, then choose this value in the “External Indicator (High)” field. If there are high and low values (e.g. candles), then you also must set the “External Indicator Low” field.
The visualization of the divergence detection is represented in the fifth column (Div Bull) and the sixth and last column (Div Bear).
REG – Regular divergence detected
HID – Hidden divergence detected
Scanner Alerts
You can opt to receive alerts for the following scenarios:
Detected up and down swings
Detected bullish and bearish divergences
Detected bar trend changes
Confirmed Reversal Bars
Confirmed Continuation Bars
Confirmed ange breakouts
The alert function is activated for all symbols listed in the scanner and corresponds to the timeframe of the chart you are currently viewing. This ensures that you receive alerts specifically tailored to the symbols and timeframe you are interested in.
Risk Disclaimer
The content, tools, scripts, articles, and educational resources offered by TRN Trading are intended solely for informational and educational purposes. Remember, past performance does not ensure future outcomes.
Alligator + MA Trend Catcher [TradeDots]The "Alligator + MA Trend Catcher" is a trading strategy that integrates the William Alligator indicator with a Moving Average (MA) to establish robust entry and exit conditions, optimized for capturing trends.
HOW IT WORKS
This strategy combines the traditional William Alligator set up with an additional Moving Average indicator for enhanced trend confirmation, creating a user-friendly backtesting tool for traders who prefer the Alligator method.
The original Alligator strategy can frequently present fluctuations, even in well-established trends, leading to potentially premature exits. To mitigate this, we incorporate a Moving Average as a secondary confirmation measure to ensure the market trend has indeed shifted.
Here’s the operational flow for long orders:
Entry Signal: When the price rises above the Moving Average, it confirms a bullish market state. Enter if Alligator spread in an upward direction. The trade remains active even if the Alligator indicator suggests a trend reversal.
Exit Signal: The position is closed when the price falls below the Moving Average, and the Alligator spreads in the downward direction. This setup helps traders to maintain positions through the entirety of the trend for maximum gain.
APPLICATION
This strategy is tailored for assets with significant, well-defined trends, such as Bitcoin and Ethereum, which are known for their high volatility and substantial price movements.
This strategy offers a low win-rate but high reward configuration, making asset selection critical for long-term profitability. If you choose assets that lack strong price momentum, there's a high chance that this strategy may not be effective.
For traders seeking to maximize gains from large trends without exiting prematurely, this strategy provides an aggressive yet controlled approach to riding out substantial market waves.
DEFAULT SETUP
Commission: 0.01%
Initial Capital: $10,000
Equity per Trade: 80%
RISK DISCLAIMER
Trading entails substantial risk, and most day traders incur losses. All content, tools, scripts, articles, and education provided by TradeDots serve purely informational and educational purposes. Past performances are not definitive predictors of future results.
Swing Suite (SMT/Divergences + Gann Swings)Hello Traders!
TRN Swing Suite (SMT/Divergences + Gann Swings) is an indicator which identifies, and highlights pivot points (swings) and prints a lot of information about the swings in the chart (e.g. length, duration, cumulative Delta, ...). Furthermore, it detects divergences in connection with any given indicator, even custom ones. In addition to this, you can choose the algorithm to compute the swings. The famous Gann-Swing algorithm and the extremely precise TRN Swing algorithm (called Standard) are available for selection, as well as two other variants. Compared to other swing or zig-zag indicators it works in real-time, does not need a look-a-head to find swings and is not repainting. Moreover, equal (double) highs and lows are detected and displayed. The TRN Swing Suite helps traders to visualize the pure price action and identify key turning points or trends. The indicator comes with the following features:
Precise real-time swing detection without repainting
Divergence detecting for any given (custom) indicator - with 11 different preset indicators
SMT (Smart Money Technique)/Divergence detecting in relation to other instruments
Swing Performance Statistics
Swing support and resistance levels
Swing trend for multiple swing sizes
Equal/double high and low detection
4 different swing computation styles
Displaying of swing labels, values and information
Customizable settings as well as look and feel
It's important to note that the TRN Swing Suite is a visual tool and does not provide specific buy or sell signals. It serves as a guide for traders to analyze market structure in depth and make well-informed trading decisions based on their trading strategy and additional technical analysis.
Divergence Detection for any given (Custom) Indicator
The divergence detector finds with unrivaled precision bullish and bearish as well as regular and hidden divergences. The main difference compared to other divergences indicators is that this indicator finds rigorously the extreme peaks of each swing, both in price and in the corresponding indicator. This precision is unmatched and therefore this is one of the best divergences detectors.
The build in divergence detector works with any given indicator, even custom ones. In addition, there are 11 built-in indicators. Most noticeable is the cumulative delta indicator, which works astonishingly well as a divergence indicator. Full list:
External Indicator (see next section for the setup)
Awesome Oscillator (AO)
Commodity Channel Index (CCI)
Cumulative Delta Volume (CDV)
Chaikin Money Flow (CMF)
Moving Average Convergence Divergence (MACD)
Money Flow Index (MFI)
Momentum
On Balance Volume (OBV)
Relative Strength Index (RSI)
Stochastic
Williams Percentage Range (W%R)
The divergences are colored with vivid lines and labels. Bullish divergences are distinguished with luminous blue lines, while bearish divergences are denoted by striking red lines. Upon detecting a divergence, the colored lines act as a visual indicator for traders, signaling an imminent possibility of a trend reversal. In response, traders can leverage this valuable insight to make informed decisions in their trading activities.
Choose Your Custom Divergence Indicator
Handpick your custom indicator, and the TRN Swing Suite will hunt for divergences on your preferred market and timeframe. Importantly, you must add the indicator to your chart. Afterwards, simply go to the “Divergence Detection” section in the TRN Swing Suite indicator settings and choose "External Indicator". If the custom indicator has one reference value, then choose this value in the “External Indicator (High)” field. If there are high and low values (e.g. candles), then you also must set the “External Indicator Low” field.
In the provided graphic, we've chosen the stochastic RSI as our example, and as you can see, the TRN Swing Suite instantly identifies and plots bullish and bearish divergences on your chart.
Smart Money Technique (SMT)/Divergence detecting in Relation to other Instruments
Smart Money Technique/Tool (SMT) means the divergence detection between two related instruments. The TRN Swing Suite finds divergence in relation to other instruments, e.g. NQ vs ES or BTCUSDT vs ETHUSDT. Just add another instrument to the chart. As representation style you can choose lines or candles/bars. Afterwards, simply go to the “Divergence Detection” section in the TRN Swing Suite indicator settings and choose "External Indicator". If the second instrument is represented as line, then choose this value in the “External Indicator (High)” field. If there are high and low values (e.g. candles/bars), then you also must set the “External Indicator Low” field.
The detection of SMTs can help traders to decide whether the trend continues, or a reversal is imminent. E.g. if the NQ makes a new higher high but the ES fails to do so and makes a new lower high, then the TRN Swing Suite shows a divergence. As a result, the probability is high that the trend will not continue, and the trader can make an informed decision about what to do next.
How to Set Parameters for Divergence Indicators
To begin, access the indicator settings and find the “Divergence Detection”. Look for the "Parameters" sections where you can fine-tune Parameters 1-3. The default settings are already optimized for the oscillators AO, RSI, CDV, W%R, MFI and Stochastic. For other divergence indicators, you might want to adjust the settings to your liking. The parameter order is the same as in the corresponding divergence indicator.
TRN Swing Suite Statistics
Unveil the untapped potential of advanced Swing Statistics! Gain invaluable insights into historical swings and turning points. Elevate your expertise by harnessing this treasure trove of data to supercharge signal reliability, while masterfully planning stop loss and take profit strategies with unrivaled accuracy. Within the TRN Swing Suite lie two powerful statistics, each offering distinct insights to empower your trading prowess.
Swing Statistic
The Swing Statistic comprises of two series, one for up swings (Up) and one for down swings (Down), with values given in points. The columns have the following meaning:
Up or down
# - total number of analyzed swings
Overall ∅ Length - average length of all swings in points
Overall ∅ Duration - average duration of swings in bars
∅ Length - average lengths for custom-defined swing counts
∅ Duration - average durations for custom-defined swing counts
The custom-defined swing count is used to determine the swing length/duration for the last x swings. Note, in the case of well-established assets like Microsoft or Nvidia, which have undergone one or more stock splits, the overall average in column three may deviate significantly from those in column five. That is why column 5 is useful.
Relation Statistic
The Relation Statistic highlights percentages representing the historical occurrence of specific high and low sequences. In the first column (in %), various types of highs and lows are listed as reference points.
For example, the first row corresponds to "HH followed by", where the second column (#) displays the total count of higher highs (HH) considered. The subsequent columns showcase the percentages of how often certain patterns follow the initial HH.
Fields marked in blue represent sequences that occurred in over 50% of cases. The darker the shade of blue in each field, the higher the percentage.
Use Swing Statistics to Validate Stop-Loss and Take-Profit Levels
No matter which signals you choose to trade, consulting Swing Statistics can significantly enhance the reliability of these signals.
For example, when looking for a long entry after a lower low (LL), you can examine the likelihood of a subsequent lower high (LH) or even a higher high (HH). Combining this valuable information with your predetermined Take Profit level allows you to better assess whether your target can be achieved successfully. Additionally, you can add the average up swing length to the lower low for an alternative Take Profit level. Similarly, you can verify the probability of the next low being a higher low (HL) or another lower low (LL) to determine the likelihood of your Stop Loss being triggered. Align the length of the last down swing with the average down swing length for an alternative Stop Loss.
Swing Support and Resistance Levels
Swing support and resistance levels are horizontal lines starting from a swing high or swing low and representing natural support and resistance levels. Price tends to respect this levels one way or another. In most cases, old swing highs and swing lows provide a lot of liquidity to the market. For example, for a swing high there are at least three different market players at work:
Traders put there stop loss above the swing high
Breakout traders go long above the swing high
Turtle soup (reverse) trader go short above the swing high
Swing Trend (Multiple Sizes)
The TRN Swing Suite can display either at the top or at the bottom the prevailing swing trends for the main trend seen in the chart and for two additional swing sizes. This is useful to see the swing trend for medium and bigger swings to get a clear picture of the market.
Getting an Edge with the TRN Swing Suite
The indicator clearly displays up trends, defined as a sequence of higher highs (HH) and higher lows (HL), with green labels and down trends, defined as a sequence of lower lows (LL) and lower highs (LH), with red labels. Equal highs/double tops (DT) and equal lows/ double bottoms (DB) are highlighted in gold.
In addition, the labels show a full stack of valuable information about the swings to maximize your accuracy.
Length
Length percentage in relation to the last swing length
Duration
Time
Volume
Cumulative Delta
In an uptrend the up swings should have higher volume und higher cumulative delta than the down swings. The duration and time for down swings in an uptrend should be shorter than for the up swings.
Use Cases for Swing Detection
Trend Identification
By connecting the swing highs and lows, traders can identify and analyze the prevailing trend in the market. An uptrend is characterized by higher swing highs and lows, while a downtrend is characterized by lower highs and lower lows. The indicator helps traders visually assess the strength and continuity of the trend.
Support And Resistance Levels
The swing highs and lows can act as support and resistance levels. Swing highs may act as resistance levels where selling pressure increases, while swing lows may act as support levels where buying pressure increases. Traders often pay attention to these levels as potential areas for trade entries, exits, or placing stop-loss orders.
Pattern Recognition
The swings identified by the indicator can help traders recognize chart patterns, such as equal high/lows, consolidations, wedges, triangles or more complex patterns like Gartley or Head and Shoulders. These patterns can provide insights into potential trend continuation or reversal.
Trade Entry and Exit
Traders may use TRN Swing to determine potential trade entry and exit points. For example, in an uptrend, traders may look for opportunities to enter long positions near swing lows or on pullbacks to support levels. Conversely, in a downtrend, traders may consider short positions near swing highs or on retracements to resistance levels.
Swing Styles
In addition to the standard swings, you have the flexibility to choose between various swing styles, including ticks, percent, or even the famous Gann swings.
Standard
Gann
Ticks
Percent
Conclusion
While signals from TRN Swings can be informative, it is important to recognize that their reliability may vary. Various external factors can impact market prices, and it is essential to consider your risk tolerance and investment goals when executing trades.
Risk Disclaimer
The content, tools, scripts, articles, and educational resources offered by TRN Trading are intended solely for informational and educational purposes. Remember, past performance does not ensure future outcomes.
TRN BarsThe innovative TRN Bars are designed to help traders to analyze markets in an intuitive way. It combines three core concepts:
TRN Bars to see the current trend and reversals (replaces the default chart bars)
Bar Ranges to highlight consolidations
Dynamic Trend to see the overall trend.
First, let's have a look at each of these concepts individually. Afterwards, we describe how a combination of all three gives you a crystal-clear picture of the market.
TRN Bars
They show bullish and bearish trends and reversals based on color coding the bars and give high probability trade opportunities with special colors. The trend analysis is based on a new algorithm that includes several different inputs:
classical and advanced bar patterns and their statistical frequency
probability distributions of price expansions after certain bar patterns
bar information such as wick length in %, overlapping of the previous bar in % and many more
historical trend and consolidation analysis
The algorithm weighs these concepts and outputs a color scheme for the chart bars or candlesticks.
Bar Types
Trend bars in green and red
Reversal Bars in blue and fuchsia
Continuation Bars in turquoise and orange
Breakout Bars in dark green and pink
Green Bars signify a sustained uptrend, indicating bullish market sentiment. On the other hand, Red Bars indicate a persistent downtrend, representing bearish market sentiment. The transition from red to green denotes a bullish trend reversal, suggesting a shift from bearish to bullish sentiment. Conversely, the shift from green to red signals a bearish trend reversal, indicating a transition from bullish to bearish sentiment. By monitoring these color changes, traders can identify potential trend reversals and make informed trading decisions.
The presence of gray and black bars indicates a neutral market state, often observed before an impending color change from red to green or green to red. These neutral bars serve as a transition phase between the previous trend and the potential reversal.
The TRN Bars incorporate Signal Bars, distinguished by their distinct colors, to offer potential buy and sell signals and deeper insights into market dynamics.
Reversal Bars
The presence of blue Reversal Bars indicates a trend reversal to the upside, while pink Reversal Bars indicate a reversal to the downside. These bars not only serve as signals for potential trend shifts but also present favorable opportunities to enter the market or increase one's position size.
Continuation Bars
In addition to the reversal bars, TRN Bars also include bullish continuation bars (colored turquoise) and bearish continuation bars (colored orange). These bars act as signals for the continuation of an existing trend. Like the reversal bars, they can be utilized as entry points or opportunities to augment one's position size.
Breakout Bars
The dark green breakout bars within TRN Bars show a powerful breakout from a price range detected by our integrated bar range feature. They signify the continuation or potential change in a trend following a consolidation phase. As such, these bars hold dual functionality, serving as reversal signals and validating the persistence of an ongoing trend.
Bar Ranges
The bar range feature automatically finds consolidations where the price range of several consecutives bars is rather small. The detection of the bar ranges includes among other things the overlapping percentage of these bars.
How to Use Price Ranges
Here are a few ways you can use the bar ranges in your trading:
Identify Support and Resistance Levels
The price ranges can help you identify key support and resistance levels on a chart. By observing price ranges and identifying these levels, you can make more informed decisions about entering or exiting trades.
Breakout Trading
Price ranges can also provide insights into potential breakout opportunities. Breakouts occur when the price breaks out of a defined range, signaling a potential shift in market sentiment and the start of a new trend. The Color highlighted Breakout Bars from the TRN Bars are signaling a powerful breakout of a price range. Traders can enter positions in the direction of the breakout and set appropriate stop-loss orders to manage risk. Note that not every price range is left by a powerful breakout.
Dynamic Trend
The Dynamic Trend combines elements from standard trend strength indicators (e.g. DI-, DI+, Parabolic SAR) and volatility indicators (e.g. ATR, Standard Deviation). It produces a moving average line that adapts to changing market volatility. It is inspired by the ideas of the programmer and trader Fat Tails. The adaptive behavior provides more relevant information for traders when compared to traditional moving averages which do not consider volatility and trend strength together. This makes the Dynamic Trend completely unique, and no other moving average indicator can give you this precision.
How to use Dynamic Trend
Generally, a rising Dynamic Trend line, displayed in green, indicates that an uptrend is strong, while a falling Dynamic Trend, displayed in red, suggests that the downtrend is sharp. The Dynamic Trend turns gray when there is insufficient clarity to establish a distinct trend and especially when there is not volatility in the market.
Identify potential trade entries and exits: When used in conjunction with price action, the Dynamic Trend can provide potential trade signals. For example, if the price crosses above the Dynamic Trend, it may be a bullish sign, suggesting a potential buy entry. Conversely, if the price crosses below the Dynamic Trend, it may indicate bearish conditions and a potential sell signal.
Trend Identification and Pullback trading
Observe the Dynamic Trend's color. When it's on the rise and appears green, it indicates a bullish trend. Conversely, if it's in decline and displayed in red, it signals a bearish trend.
If Dynamic Trend is green and price pulls from above back to the Dynamic Trend, then this can be considered as a bullish signal.
If Dynamic Trend is red and price pulls from below back to the Dynamic Trend, then this can be considered as a bearish signal.
In the event of a bearish signal, such as a bearish TRN Signal Bar, and the Dynamic Trend is red, it provides additional confirmation to the bearish signal. Likewise, bullish signals gain added conviction when the Dynamic Trend is green.
Crossovers
As with other moving averages, crossovers between the Dynamic Trend and the price can be significant.
If price is crossing above the Dynamic Trend, then this can be considered as a bullish signal.
If price is crossing below the Dynamic Trend, then this can be considered as a bearish signal.
If you currently hold a position, both bullish and bearish crossovers can serve as potential exit signals. For instance, in the case of a long position, a bearish crossover can indicate a potential shift in sentiment, signaling a bearish reversal and a potential opportunity to close your long position.
Filtering Noise
Due to its adaptive nature, the Dynamic Trend can be a useful tool to filter out market noise. When the market is choppy or consolidating, the Dynamic Trend tends to remain flat and colored gray, signaling traders to potentially stay out of the market.
Stop Losses
The Dynamic Trend can also be used as a dynamic stop loss. For instance, in a long trade, traders can use the Dynamic Trend as a trailing stop, selling their position if the price crosses below the Dynamic Trend.
Combining TRN Bars, Bar Ranges and Dynamic Trend together
Combining all three concepts gives you a crystal-clear picture of the market. The Dynamic Trend shows you the overall trend. If price pulls back to the dynamic trend line and then price picks up the trend direction again, then the TRN Bars immediately switch the color to the trend direction. Therefore, you can easily identify high probability entry signals based on the bar color.
As a simple trading model, you can set the stop loss below the last swing or below a TRN signal bar (vice versa for short entries) and use 2.5 R or 3 R as target.
You can increase the success rate of the high probability TRN signal bars entries even more if they are in line with the Dynamic Trend line.
On the other hand, the TRN Bar Ranges help you to stay out of the market in case the price does not really change. As a confluence signal to stay flat in this period the dynamic trend line tends to be grey as well. If the price breaks out of the range, then the TRN Bars print a breakout bar which serves as a high probability entry signal.
Although it is possible to switch off any of these concepts, it is highly recommended to use all three in combination to get a crystal-clear picture of the market.
Alerts
Experience the power of our TRN Bars Alerts, delivering real-time notifications for trend changes, price range breakouts, and signal bar formations or confirmations. Stay on top of the market with these versatile alerts, customizable to your preferred assets and timeframes.
Conclusion
While signals from TRN Bars can be informative, it is important to recognize that their reliability may vary. Various external factors can impact market prices, and it is essential to consider your risk tolerance and investment goals when executing trades.
RSI and ATR Trend Reversal SL/TPQuick History:
I was frustrated with a standard fixed percent TP/SL as they often were not receptive to quick market rallies/reversals. I developed this TP/SL and eventually made it into a full fledge strategy and found it did well enough to publish. This strategy can be used as a standalone or tacked onto another strategy as a TP/SL. It does function as both with a single line. This strategy has been tested with TSLA , AAPL, NVDA, on the 15 minutes timeframe.
HOW IT WORKS:
Inputs:
Length: Simple enough, it determines the length of the RSI and ATR used.
Multiplier: This multiplies the RSI and ATR calculation, more on this later.
Delay to prevent Idealization: TradingView will use the open of the bar the strategy triggers on when calculating the backtest. This can produce unrealistic results depending on the source. If your source is open, set to 0, if anything else, set to 1.
Minimum Difference: This is essentially a traditional SL/TP, it is borderline unnecessary, but if the other parameters are wacky this can be used to ensure the SL/TP. It multiplies the source by the percent, so if it is set to 10, the SL/TP is initialized at src +- 10%.
Source input: Self Explanatory, be sure to update the Delay if you use open.
CALCULATION:
Parameters Initialization:
The strategy uses Heikinashi values for calculations, this is not toggleable in parameters, but can be easily changed by changing hclose to equal src.
FUNCTION INITIALIZATION:
highest_custom and lowest_custom do the same thing as ta.highest and ta.lowest, however the built in ta library does not allow for var int input, so I had to create my own functions to be used here. I actually developed these years ago and have used them in almost every strategy since. Feel especially free to use these in your own scripts.
The rsilev is where the magic happens.
SL/TP min/max are initially calculated to be used later.
Then we begin by establishing variables.
BullGuy is used to determine the length since the last crossup or crossdown, until one happens, it returns na, breaking the function. BearGuy is used in all the calculations, and is the same as BullGuy, unless BullGuy is na, where BearGuy counts up from 1 on each bar from 0.
We create our rsi and have to modify the second one to suit the function. In the case of the upper band, we mirror the lower one. So if the RSI is 80, we want it to be 20 on the upper band.
the upper band and lower band are calculated the exact same way, but mirrored. For the purpose of writing, I'm going to talk about the lower band. Assume everything is mirrored for the upper one. It finds the highest source since the last crossup or crossdown. It then multiplies from 1 / the RSI, this means that a rapid RSI increase will increase the band dramatically, so it is able to capture quick rally/reversals. We add this to the atr to source ratio, as the general volatility is a massive factor to be included. We then multiply this number by our chosen amount, and subtract it from the highest source, creating the band.
We do this same process but mirrored with both bands and compared it to the source. If the source is above the lower band, it suggests an uptrend, so the lower band is outputted, and vice versa for the upper one.
PLOTTING:
We also determine the line color in the same manner as we do the trend direction.
STRATEGY:
We then use the source again, and if it crosses up or down relative to the selected band, we enter a long or short respectively.
This may not be the most superb independent strategy, but it can be very useful as a TP/SL for your chosen entry conditions, especially in volatile markets or tickers.
Thank you for taking the time to read, and please enjoy.
Bull Bear Trend IndicatorIntroduction: Origin of the Swing Point Indicator
In the quest for a reliable indicator that accurately predicts trend directions and identifies valid highs and lows, the genesis of the Swing Point Indicator emerged. Faced with the challenge of finding a tool that provided comprehensive market analysis and actionable insights, the need for a novel solution became evident. Combining insights gleaned from market analysis and innovative algorithmic approaches, the Swing Point Indicator was born.
Enhanced Feature: Highs and Lows Labeling in Trend Direction
In addition to its core functionalities, the Swing Point Indicator incorporates an advanced feature that enhances the visualization of trend direction. This feature provides further clarity by selectively labeling highs and lows based on the prevailing trend, reinforcing the identification of higher highs and lower lows in uptrends and downtrends, respectively. Overlapping labels on highs and lows signify a potential trend change, providing traders with valuable insight into market reversals.
Detailed Description:
1. Uptrend Labeling:
- Higher Highs (Green Label with Price): In an uptrend, where higher highs are observed, the indicator labels these points with vibrant green color and includes the corresponding price value. This visually highlights the significance of higher highs as pivotal points in the upward trajectory of prices.
- Higher Lows (Red Marker without Text or Diamond): To complement the identification of higher highs, higher lows are marked with a distinct red marker or diamond, devoid of any accompanying text. While these points are crucial in delineating the ascending trend, their emphasis lies in their role as support levels, providing a foundation for upward price movements.
2. Downtrend Labeling:
- Lower Lows (Red Label with Price): Conversely, in a downtrend characterized by lower lows, the indicator labels these points with conspicuous red color, accompanied by the corresponding price value. Lower lows signify critical levels of downward price momentum, acting as indicators of potential bearish continuation.
- Lower Highs (Green Marker without Text or Diamond): Lower highs, indicative of downward retracements in a downtrend, are marked by distinctive green markers or diamonds without accompanying text. While these points denote temporary pauses or pullbacks in the bearish trend, their emphasis lies in their role as resistance levels, impeding upward price movements.
Functionality and Utility:
- Customizable Lookback Candle Count: Traders have the option to adjust the lookback candle count, which is set by default at 108 candles in the settings. This flexibility allows traders to tailor the indicator to their specific trading preferences and timeframes.
- Equal Highs or Lows Option: When enabled, the Swing Point Indicator can identify equal highs or equal lows, providing traders with additional insight into market dynamics.
- Formation Confirmation: A new higher high along with its higher low or a new lower low along with its lower high is confirmed after two candles have closed following the swing point candle. This ensures the reliability of the identified trend direction.
Conclusion:
The incorporation of selective labeling for highs and lows based on trend direction, alongside the introduction of customizable settings and formation confirmation criteria, enhances the effectiveness of the Swing Point Indicator. This feature-rich tool empowers traders with a nuanced understanding of market dynamics, highlighting critical price levels and trend reversals. By offering enhanced visualization, customizable options, and confirmation criteria, the Swing Point Indicator equips traders with the confidence and precision needed to navigate the markets successfully, contributing to more informed and profitable trading strategies.
CSC_Macchiato Price Trend Oscillator by CoffeeShopCryptoDescription:
Introducing "The Macchiato" – your go-to indicator in the realm of trading, meticulously crafted by CoffeeShopCrypto. Much like the complex flavors of a well-made Macchiato, this tool offers a robust suite of functionalities designed to enhance your trading experience across Forex, stocks, and cryptocurrencies.
The Macchiato stands out for its distinct ability to confirm market trends, identify building momentum, and navigate through periods of market stalls. Drawing cues from the RSI (Relative Strength Index), its color scheme dynamically reflects the shifts in market forces, providing traders with real-time insights into price action dynamics.
Gone are the days of navigating through market uncertainties blindly. With The Macchiato at your disposal, you gain a more clear understanding of market movements, helping you to make informed decisions with confidence. Whether you're a seasoned trader or just starting out, this indicator adds more confluence to your trading strategy, ensuring that you stay ahead of the curve in today's fast-paced trading environment.
So, say goodbye to guesswork and hello to precision trading with The Macchiato – where real-time data analysis meets actionable insights, all in the quest for trading success.
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The Histogram:
The Macchiato Histogram gives you a representation of current change in closing values against the closing values within a "Range" of the lookback period. It calculates your price ranging extremes of the highest high vs lowest low according to your lookback setting. Then it shows you whether the momentum of these closing prices calculated against the highs or the lows is either rising or falling. It takes into account the difference in the highs, lows, open and closing prices as a whole. This helps to determine the actual trend of your market structure.
Histogram Rising / Falling:
The Histogram of the Macchiato doesn't care about being above or below zero. Since we are simply calculating momentum rising or falling, then we only care that the histogram is rising or falling. Especially when it's doing this in line with our Macchiato Average.
Macchiato Average:
Included is a smoothing line called "the Macchiato Average"
Using the average is just like using a moving average against price action, however here we are using one against momentum to determine whether price is moving against, with, better, or worse than the current average of momentum.
The RSI:
The base purpose of the RSI in this tool is mainly to color the columns of the Histogram.
I gave you the benefit of exposing the RSI so you can see where it lies in the oscillator for any additional strategies you may use.
How the RSI Colors the Histogram:
The Histogram has 4 momentum colors and 1 non-momentum color.
They are described below but here we will understand why they exist the way they do against the RSI positioning.
The 4 momentum colors:
You can have the RSI in 4 different positions against its moving average.
Trend Trading Colors and setups:
Strong Long - RSI above zero and above its average is a strong long trend.
Strong Short - RSI below zero and below its average is a strong short trend.
These can also be seen as breakout indications.
Counter Trend Trading and Setups:
Weak Long - RSI above zero and below its average is a weak long trend.
Weak Short - RSI below zero and above its average is a weak short trend.
(Only trade weak momentum to known internal support and resistance areas.)
You'll notice that when the RSI is set up against its RSI Moving average under these conditions, the Histogram is colored accordingly to tell you whether you have strong or weak momentum.
For these colors to appear accordingly, the RSI and the momentum of the histogram must be moving in the same direction as each other.
The 5th color of the Histogram:
(GRAY)
This is where there is a divergence / disagreement between your RSI setup and the momentum being observed. If momentum is moving one way and the force of the RSI is not matching the overall momentum, you have a divergence. This commonly means that higher timeframe momentum is in disagreement to lower or current timeframe closing momentum changes.
Conditions of a Bullish Trending Market:
The color scheme has specific implications when all columns are above zero.
As noted before, the Macchiato doesn't care that it is above or below zero. It simply needs to be rising or falling. The color scheme is depicted by what the RSI is doing in relation to ZERO and where it lies against its average.
This image helps to differentiate what is happening with momentum when in a strong bullish market.
The color scheme is always the same. You always have 4 conditions of momentum.
According to the default settings:
Strong Long = Dark Green
Weak Long = Light Green
Strong Short = Dark Red
Weak short = Light Red
The final color is GRAY which is standard for a NON directional market.
You can alter the colors as you choose for your chart background and color preference.
Macchiato Bias Line Conditions
The "Bias Line" helps you understand whether your current momentum is traveling into opposing forces or if your momentum is going WITH the bias.
Going against the bias would be like momentum and price action converging against each other.
Going in the same direction would offer much larger movements on price.
Using the Bias to trade
Trading Internal Support and Resistance
Noting previous price action, pivots, and price swings is important in its use.
When you see momentum coming to a halt or changing, note the previous price action that you are approaching. You should see the histogram change its color, telling you where momentum is ending in its current direction.
EXAMPLE BULLISH MARKET FLIP
There is the exception however that when the market flips, from bearish to bullish, you can see the following:
BIAS LINE switches to a Bullish Bias
Histogram is showing Strong Long Color
Histogram stays ahead of the BIAS line
Price should break previous swing highs to create new highs.
Strategy you can use in observance. (short pause, to pullback, to continued short)
If the momentum is rising while RSI is falling you'll have gray columns until the RSI is in the correct positions against its average.
For your trend to continue downward you are looking for dark red or "Strong Short" columns.
When there is a disagreement, your columns will be gray and then switch to weak long. (Light Green)
This is because your RSI is above its average while the RSI is bearish.
This light green area can be observed as the pullback area.
If you only want to trade short, you would wait for the pullback to be complete.
This occurs when the weak long changes back to gray and then strong short, or skipping gray into strong short.
Bayesian Bias OscillatorWhat is a Bayes Estimator?
Bayesian estimation, or Bayesian inference, is a statistical method for estimating unknown parameters of a probability distribution based on observed data and prior knowledge about those parameters. At first , you will need a prior probability distribution, which is a prior belief about the distribution of the parameter that you are interested in estimating. This distribution represents your initial beliefs or knowledge about the parameter value before observing any data. Second , you need a likelihood function, which represents the probability of observing the data given different values of the parameter. This function quantifies how well different parameter values explain the observed data. Then , you will need a posterior probability distribution by combining the prior distribution and the likelihood function to obtain the posterior distribution of the parameter. The posterior distribution represents the updated belief about the parameter value after observing the data.
Bayesian Bias Oscillator
This tool calculates the Bayes bias of returns, which are directional probabilities that provide insight on the "trend" of the market or the directional bias of returns. It comes with two outputs: the default one, which is the Z-Score of the Bayes Bias, and the regular raw probability, which can be switched on in the settings of the indicator.
The Z-Score output value doesn't tell you the probability, but it does tell you how much of a standard deviation the value is from the mean. It uses both probabilities, the probability of a positive return and the probability of a negative return, which is just (1 - probability of a positive return).
The probability output value shows you the raw probability of a positive return vs. the probability of a negative return. The probability is the value of each line plotted (blue is the probability of a positive return, and purple is the probability of a negative return).
ORB Heikin Ashi SPY 5min Correlation StrategyOverview:
The ORB (Opening Range Breakout) strategy combined with Heikin Ashi candles and Relative Volume (RVOL) indicator aims to capitalize on significant price movements that occur shortly after the market opens. This strategy identifies breakouts above or below the opening range, using Heikin Ashi candles for smoother price visualization and RVOL to gauge the strength of the breakout.
Components:
Opening Range Breakout (ORB): The strategy starts by defining the opening range, typically the first few minutes of the trading session. It then identifies breakouts above the high or below the low of this range as potential entry points.
Heikin Ashi Candles: Heikin Ashi candles are used to provide a smoother representation of price movements compared to traditional candlesticks. By averaging open, close, high, and low prices of the previous candle, Heikin Ashi candles reduce noise and highlight trends more effectively.
Relative Volume (RVOL): RVOL compares the current volume of a stock to its average volume over a specified period. It helps traders identify abnormal trading activity, which can signal potential price movements.
Candle for correlation : In this case we are using SPY candles. It can also use different asset
Strategy Execution:
Initialization: The strategy initializes by setting up variables and parameters, including the ORB period, session timings, and Heikin Ashi candle settings.
ORB Calculation: It calculates the opening range by identifying the high and low prices during the specified session time. These values serve as the initial reference points for potential breakouts. For this we are looking for the first 30 min of the US opening session.
After that we are going to use the next 2 hours to check for breakout opportunities.
Heikin Ashi Transformation: Optionally, the strategy transforms traditional candlestick data into Heikin Ashi format for smoother visualization and trend identification.
Breakout Identification: It continuously monitors price movements within the session and checks if the current high breaches the ORB high or if the current low breaches the ORB low. These events trigger potential long or short entry signals, respectively.
RVOL Analysis: Simultaneously, the strategy evaluates the relative volume of the asset to gauge the strength of the breakout. A surge in volume accompanying the breakout confirms the validity of the signal. In this case we are looking for at least a 1 value of the division between currentVolume and pastVolume
Entry and Exit Conditions: When a breakout occurs and is confirmed by RVOL and is within our session time, the strategy enters a long or short position accordingly. It does not have a stop loss or a takie profit level, instead it will always exit at the end of the trading session, 5 minutes before
Position Sizing and Commissions: For the purpose of this backtest, the strategy allocated 10% of the capital for each trade and assumes a trading commission of 0.01$ per share ( twice the IBKR broker values)
Session End: At the end of the trading session, the strategy closes all open positions to avoid overnight exposure.
Conclusion:
The combination of ORB breakout strategy, Heikin Ashi candles, and RVOL provides traders with a robust framework for identifying and capitalizing on early trends in the market. By leveraging these technical indicators together, traders can make more informed decisions and improve the overall performance of their trading strategies. However, like any trading strategy, it's essential to backtest thoroughly and adapt the strategy to different market conditions to ensure its effectiveness over time.
Trend Tide Oscillator [UAlgo]🔶 Description:
The "Trend Tide Oscillator " is a technical analysis tool designed to identify potential trend reversals and overbought/oversold conditions in the market. It calculates an oscillator based on the Commodity Channel Index (CCI) and then applies smoothing techniques to provide a clearer view of market momentum.
🔶 Key Features:
Oscillator Calculation : The indicator calculates an oscillator based on the Commodity Channel Index (CCI), which is a momentum-based oscillator used to identify overbought and oversold conditions.
Smoothing : Smoothing techniques are applied to the oscillator to reduce noise and provide a clearer view of market momentum. This helps traders in identifying trends more effectively.
Support and Resistance Zones : The indicator plots support and resistance zones based on the highest and lowest values of the oscillator over a specified lookback (default 50) period. These zones can help traders identify potential areas of price reversal. The indicator considers volatility when plotting the support and resistance zones. This aims to create more adaptable levels that account for fluctuating market conditions.
Visualization : The indicator visually represents overbought and oversold conditions with shapes (⚠️), aiding traders in quickly identifying potential entry or exit points.
Customization : Users can adjust parameters such as oscillator length, smoothing, and overbought/oversold levels, support and resistance lookbacks according to their trading preferences.
🔶 Disclaimer :
This indicator is provided for informational and educational purposes only and should not be considered as financial advice. Trading in the financial markets involves risk, and users should conduct their own research and analysis before making any investment decisions.
RSI Confirm Trend with Williams (W%R)RSI Confirm Trend with Williams (W%R)
This is the "RSI Confirm Trend with Williams (W%R)" indicator
This is a modification of the "RSI Trends" indicator by zzzcrypto123.
What Is the Relative Strength Index (RSI)?
The relative strength index (RSI) is a momentum indicator used in technical analysis. RSI measures the speed and magnitude of a security's recent price changes to evaluate overvalued or undervalued conditions in the price of that security.
What is Williams %R?
Williams %R, also known as the Williams Percent Range, is a type of momentum indicator that moves between 0 and -100 and measures overbought and oversold levels. The Williams %R may be used to find entry and exit points in the market. The indicator is very similar to the Stochastic oscillator and is used in the same way. It was developed by Larry Williams and it compares a stock’s closing price to the high-low range over a specific period, typically 14 days or periods.
How Does "RSI Confirm Trend with Williams (W%R)" work?
This indicator combines the momentum of both RSI and Williams %R by adding upper and lower thresholds. When the thresholds are broken, this indicator changes color from gray to either green or red.
What Are The Thresholds?
The default RSI thresholds are 55 and 45. These values are configurable.
The default Williams %R thresholds are 80 and 20. These values are configurable and made positive so it can be plotted against the RSI line.
How To Use?
When the RSI exceeded the upper/lower thresholds, the RSI line color will change from gray to lighter green/red color.
When the Williams %R exceeded the upper/lower thresholds, the RSI color will change to darker green/red color signifying a strong momentum in that direction.
When the RSI color is gray, this means the RSI and Williams %R thresholds are not broken which can also signify as no trend or consolidation.
The Williams %R line is not displayed by default but can be enabled using the checkbox provided in the Style tab.
This "RSI Confirm Trend with Williams (W%R)" indicator can be combined with other technical indicators to verify the idea behind this theory.
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Disclaimer
The information contained in this indicator does not constitute any financial advice or a solicitation to buy or sell any securities of any type.
My scripts/indicators/ideas are for educational purposes only!
Sequencer [LuxAlgo]The Sequencer indicator is a tool that is able to highlight sequences of prices based on their relative position to past prices, which allows a high degree of customization from the user.
Two phases are included in this script, a "Preparation" phase and a "Lead-Up" phase, each with a customizable amount of steps, as well as other characteristics.
Users can also highlight the last step leading to each phase completion with a level, this level can eventually be used as a key price point.
🔶 USAGE
The script highlights two phases, each being based on a sequence of events requiring prices to be higher/lower than prices various bars ago.
The completion of the preparation phase will lead to the evaluation of the lead-up phase, however, it isn't uncommon to see a reversal occurring after the completion of a preparation phase. In the script, bullish preparations are highlighted in green, while bearish preparations are highlighted in red.
Completion of a "Lead-Up" phase is indicative of a potential reversal, with a bullish reversal for the completion of a bullish lead-up (in blue), and a bearish reversal for the completion of a bearish lead-up (in orange).
Using a higher length for the preparation/lead-up phases can allow the detection of longer-term reversals.
Users wishing to display levels based on specific phases completion can do so from the settings in the "Preparation/Lead-Up Completion Levels" settings group.
The "Show Last" settings determine the amount of respective levels to display on the chart.
🔶 PREPARATION PHASE
The "Preparation" phase precedes the "Lead-Up" phase. The completion of this phase requires N successive prices to be lower than the closing price P bars ago for a bullish phase, and for prices to be higher than the closing price P bars ago for a bearish phase, where N is the user set "Preparation Phase Length" and P the user set "Comparison Period".
🔹 Refined Preparations
Sequences of the preparation phase can either be "Standard" or "Refined". Unlike the standard preparation previously described a refined preparation requires the low prices from the user-specified steps in "Refined Preparation Steps" to be above the low price of the last step for a bullish preparation phase, and for the high prices specified in the refined preparation steps to be below the high price of the last step for a bearish preparation phase.
🔶 LEAD-UP PHASE
The "Lead-Up" phase is initiated by the completion of the "Preparation" phase.
Completion of this phase requires the price to be lower than the low price P bars ago N times for a bullish phase, and for prices to be higher than the high price P bars ago N times for a bearish phase, where N is the user set "Lead-Up Phase Length" and P the user set "Comparison Period".
Unlike with the "Preparation" phase these conditions don't need to be successive for them to be valid and can occur at any time.
🔹 Lead-Up Cancellation
Incomplete "Lead-Up" phases can be canceled and removed from the chart once a preparation of the opposite sentiment is completed, avoiding lead-ups to be evaluated after completion of complete preparations.
This can be disabled by toggling off "Apply Cancellation".
🔹 Lead-Up Suspension
Like with refined preparations, we can require specific steps from the lead-up phase to be higher/lower than the price on the last step. This can be particularly important since we do not require lead-up steps to be successive.
For a bullish lead-up, the low of the last step must be lower than the minimum closing prices of the user-specified steps for it to be valid, while for a bearish lead-up, the high of the last step must be higher than the maximum closing prices of the user-specified steps for it to be valid.
This effectively allows for eliminating lead-up phases getting completed on opposite trends.
🔶 SETTINGS
🔹 Preparation Phase
Preparation Phase Length: Length of the "Preparation" phase.
Comparison Period: Offset used to compare current prices to past ones.
Preparation Type: Type of preparation to evaluate, options include "Standard" or "Refined"
Refined Preparations Steps: Steps to evaluate when preparation type is "Refined"
🔹 Lead-Up Phase
Lead-Up Phase Length: Length of the "Lead-Up" phase.
Comparison Period: Offset used to compare current prices to past ones.
Suspension: Applies suspension rule to evaluate lead-up completion.
Suspension Steps: Specifies the steps evaluated to determine if the lead-up referral is respected. Multiple steps are supported and should be comma-separated.
Apply Cancellation: Cancellation will remove any incomplete lead-up upon the completion of a new preparation phase of the opposite sentiment.
🔹 Levels
Bullish Preparations Levels: When enabled display price levels from completed bullish preparations.
Show Last: Number of most recent bullish preparations levels to display.
Bearish Preparations Levels: When enabled display price levels from completed bearish preparations.
Show Last: Number of most recent bearish preparations levels to display.
Trend Lines with Break Signals [UAlgo]🔶 Description:
The "Trend Lines with Breaks " indicator is designed to identify and visualize trend lines on a price chart, allowing traders to observe potential trend reversals or continuations. This script implements a method to draw trend lines based on pivot points (highs and lows) within a specified sensitivity range. It also provides an option to display breaks in these trend lines, aiding traders in recognizing significant market movements.
🔶 Key Features:
Trend Line Sensitivity Adjustment: Users can adjust the sensitivity of the trend lines using the "Trend Line Sensitivity" parameter, allowing customization based on market conditions and preferences.
Visualization of Trend Lines: The indicator visually represents trend lines on the chart, distinguishing between upward and downward trends. Users can customize the appearance of these trend lines, including color, style, and width.
Detection of Trend Line Breaks: Trend line breaks are identified by comparing the current price with the slope of the trend line. If the price breaks below (for bullish trend lines) or above (for bearish trend lines) the slope of the trend line, indicating a potential reversal, a "B" label is displayed on the chart. Trend line breaks are only displayed if the "showBreaks" parameter is enabled.
Before Bearish Trend Line Break :
If the price "Close" value closes above the trend line :
Before Bullish Trend Line Break :
If the price "Close" value closes below the trend line :
🔶 Disclaimer:
Not Financial Advice: This indicator is intended for educational and informational purposes only. It does not constitute financial advice or recommendations to buy, sell, or hold any financial instruments.
Use at Own Risk: Trading involves substantial risk of loss and is not suitable for all investors. Users of this indicator should exercise caution and conduct their own research and analysis before making any trading decisions.
Performance Not Guaranteed: Past performance is not indicative of future results. While the indicator aims to assist traders in analyzing market trends, there is no guarantee of accuracy or success in trading operations.
QuarterCandlesChanges candle color when close is within the top 25% or bottom 25% of candle range (High - Low) on the last candle update.
Due to limitations of barcolor command, I'd suggest that you turn OFF the candle borders (chart settings--> right click on chart --> settings -->symbol and uncheck the border option) to ensure that the bar color is easily identifiable.
Johnny's Moving Average RibbonProps to Madrid for creating the original script: Madrid Moving Average Ribbon.
All I did was upgrade it to pinescript v5 and added a few changes to the script.
Features and Functionality
Moving Average Types: The indicator offers a choice between exponential moving averages (EMAs) and simple moving averages (SMAs), allowing users to select the type that best fits their trading strategy.
Dynamic Color Coding: Each moving average line within the ribbon changes color based on its direction and position relative to a reference moving average, providing visual cues for market sentiment and trend strength.
Lime Green: Indicates an uptrend and potential long positions, shown when a moving average is rising and above the longer-term reference MA.
Maroon: Suggests caution for long positions or potential short reentry points, displayed when a moving average is rising but below the reference MA.
Ruby Red: Represents a downtrend, suitable for short positions, shown when a moving average is falling and below the reference MA.
Green: Signals potential reentry points for downtrends or warnings for uptrend reversals, displayed when a moving average is falling but above the reference MA.
Usage and Application
Trend Identification: Traders can quickly ascertain the market's direction at a glance by observing the predominant color of the ribbon and its orientation.
Trade Entry and Exit Points: The color transitions within the ribbon can signal potential entry or exit points, with changes from green to lime or red to maroon indicating shifts in market momentum.
Customization: Users have the flexibility to toggle between exponential and simple moving averages, allowing for a tailored analytical approach that aligns with their individual trading preferences.
Technical Specifications
The ribbon consists of multiple moving averages calculated over different periods, typically ranging from shorter to longer-term intervals to capture various aspects of market behavior.
The color dynamics are determined by comparing each moving average to a reference point, often a longer-term moving average within the ribbon, to assess the relative trend strength and direction.
Adaptive Schaff Trend Cycle (STC) [AlgoAlpha]Introducing the Adaptive Schaff Trend Cycle by AlgoAlpha: Elevate Your Trading Strategies 🚀
Discover precision and adaptability with the Adaptive Schaff Trend Cycle 🎯, meticulously crafted for traders seeking an edge in the markets. This advanced tool integrates sophisticated algorithms to offer clear insights and real-time analytics 📈.
Key Features:
⚙️Adaptive Signal Processing: Utilizes evolving calculations to adjust to market changes, offering highly responsive signals.
🔍Enhanced MACD Analysis: Innovates on the traditional MACD, providing new insights into market dynamics through an adaptive lens.
🎨Customizable Visual Experience: Features customizable up and down colors for tailored chart analysis.
🔔Real-Time Alerts: Stay informed with instant alerts on indicator changes.
Quick Guide to Using the Adaptive STC Indicator
1. 🔧 Adding the Indicator: Search for "Adaptive Schaff Trend Cycle (STC) " within TradingView's Indicators & Strategies and apply it to your chart. Customize the settings according to your trading style for optimum results.
2.👀 Market Analysis: Monitor the STC and Histogram values closely. The indicator's color gradients provide a visual representation of momentum shifts, helping you to identify trends more clearly.
3. 🚨 Set Alerts: Enable alerts for specific conditions like significant moves up or down, or when the histogram crosses zero. This feature ensures you never miss a potential trading opportunity.
How It Works:
The Adaptive Schaff Trend Cycle by AlgoAlpha introduces a dynamic approach to market analysis, refining traditional indicators through adaptive logic to align with fluctuating market conditions. Here's a concise overview of its operation:
🔄 Adaptive MACD Adjustment: The foundation of the indicator is an enhanced MACD calculation, which dynamically adjusts its parameters based on real-time market trends and momentum. This algorithmic adjustment aims to ensure the MACD's responsiveness to market changes, adapting its sensitivity to offer timely insights .
🌟 Integration of Schaff Trend Cycle (STC): After adjusting the MACD, the indicator calculates STC values to provide a smoothed representation of market trends. By normalizing and smoothing the MACD values on a scale from 0 to 100, the STC method helps in identifying market phases with a clear visualization. The smoothing process is designed to mitigate noise and focus on significant market movements .
📊 Visualization and Alerts: To aid in the interpretation of these insights, the Adaptive Schaff Trend Cycle employs color gradients and customizable visual settings to indicate momentum shifts. These visual cues, combined with alert functionalities, are structured to assist traders in monitoring market developments, enabling them to make informed decisions based on the presented data .
🛠️The Adaptive Schaff Trend Cycle thus merges adaptive MACD adjustments with STC methodology, supported by visual and alert features, to create a tool aimed at enhancing market analysis. By focusing on adaptability and current market conditions, it provides a nuanced view of market trends, intended to support traders in their decision-making processes without promising predictive accuracy or reliability .
ZigZag Library [TradingFinder]🔵 Introduction
The "Zig Zag" indicator is an analytical tool that emerges from pricing changes. Essentially, it connects consecutive high and low points in an oscillatory manner. This method helps decipher price changes and can also be useful in identifying traditional patterns.
By sifting through partial price changes, "Zig Zag" can effectively pinpoint price fluctuations within defined time intervals.
🔵 Key Features
1. Drawing the Zig Zag based on Pivot points :
The algorithm is based on pivots that operate consecutively and alternately (switch between high and low swing). In this way, zigzag lines are connected from a swing high to a swing low and from a swing low to a swing high.
Also, with a very low probability, it is possible to have both low pivots and high pivots in one candle. In these cases, the algorithm tries to make the best decision to make the most suitable choice.
You can control what period these decisions are based on through the "PiPe" parameter.
2.Naming and labeling each pivot based on its position as "Higher High" (HH), "Lower Low" (LL), "Higher Low" (HL), and "Lower High" (LH).
Additionally, classic patterns such as HH, LH, LL, and HL can be recognized. All traders analyzing financial markets using classic patterns and Elliot Waves can benefit from the "zigzag" indicator to facilitate their analysis.
" HH ": When the price is higher than the previous peak (Higher High).
" HL ": When the price is higher than the previous low (Higher Low).
" LH ": When the price is lower than the previous peak (Lower High).
" LL ": When the price is lower than the previous low (Lower Low).
🔵 How to Use
First, you can add the library to your code as shown in the example below.
import TFlab/ZigZagLibrary_TradingFinder/1 as ZZ
Function "ZigZag" Parameters :
🟣 Logical Parameters
1. HIGH : You should place the "high" value here. High is a float variable.
2. LOW : You should place the "low" value here. Low is a float variable.
3. BAR_INDEX : You should place the "bar_index" value here. Bar_index is an integer variable.
4. PiPe : The desired pivot period for plotting Zig Zag is placed in this parameter. For example, if you intend to draw a Zig Zag with a Swing Period of 5, you should input 5.
PiPe is an integer variable.
Important :
Apart from the "PiPe" indicator, which is part of the customization capabilities of this indicator, you can create a multi-time frame mode for the indicator using 3 parameters "High", "Low" and "BAR_INDEX". In this way, instead of the data of the current time frame, use the data of other time frames.
Note that it is better to use the current time frame data, because using the multi-time frame mode is associated with challenges that may cause bugs in your code.
🟣 Setting Parameters
5. SHOW_LINE : It's a boolean variable. When true, the Zig Zag line is displayed, and when false, the Zig Zag line display is disabled.
6. STYLE_LINE : In this variable, you can determine the style of the Zig Zag line. You can input one of the 3 options: line.style_solid, line.style_dotted, line.style_dashed. STYLE_LINE is a constant string variable.
7. COLOR_LINE : This variable takes the input of the line color.
8. WIDTH_LINE : The input for this variable is a number from 1 to 3, which is used to adjust the thickness of the line that draws the Zig Zag. WIDTH_LINE is an integer variable.
9. SHOW_LABEL : It's a boolean variable. When true, labels are displayed, and when false, label display is disabled.
10. COLOR_LABEL : The color of the labels is set in this variable.
11. SIZE_LABEL : The size of the labels is set in this variable. You should input one of the following options: size.auto, size.tiny, size.small, size.normal, size.large, size.huge.
12. Show_Support : It's a boolean variable that, when true, plots the last support line, and when false, disables its plotting.
13. Show_Resistance : It's a boolean variable that, when true, plots the last resistance line, and when false, disables its plotting.
Suggestion :
You can use the following code snippet to import Zig Zag into your code for time efficiency.
//import Library
import TFlab/ZigZagLibrary_TradingFinder/1 as ZZ
// Input and Setting
// Zig Zag Line
ShZ = input.bool(true , 'Show Zig Zag Line', group = 'Zig Zag') //Show Zig Zag
PPZ = input.int(5 ,'Pivot Period Zig Zag Line' , group = 'Zig Zag') //Pivot Period Zig Zag
ZLS = input.string(line.style_dashed , 'Zig Zag Line Style' , options = , group = 'Zig Zag' )
//Zig Zag Line Style
ZLC = input.color(color.rgb(0, 0, 0) , 'Zig Zag Line Color' , group = 'Zig Zag') //Zig Zag Line Color
ZLW = input.int(1 , 'Zig Zag Line Width' , group = 'Zig Zag')//Zig Zag Line Width
// Label
ShL = input.bool(true , 'Label', group = 'Label') //Show Label
LC = input.color(color.rgb(0, 0, 0) , 'Label Color' , group = 'Label')//Label Color
LS = input.string(size.tiny , 'Label size' , options = , group = 'Label' )//Label size
Show_Support= input.bool(false, 'Show Last Support',
tooltip = 'Last Support' , group = 'Support and Resistance')
Show_Resistance = input.bool(false, 'Show Last Resistance',
tooltip = 'Last Resistance' , group = 'Support and Resistance')
//Call Function
ZZ.ZigZag(high ,low ,bar_index ,PPZ , ShZ ,ZLS , ZLC, ZLW ,ShL , LC , LS , Show_Support , Show_Resistance )
WaveTrend Ribbon [AlgoAlpha]🌟🚀 Introducing the WaveTrend Ribbon by AlgoAlpha - Your Next-Level Trading Companion! 🚀🌟
Dive into the world of advanced trading with the WaveTrend Ribbon by AlgoAlpha, a cutting-edge indicator designed to elevate your trading strategy on TradingView. 📈💡 This powerful tool combines the efficiency of the WaveTrend oscillator with innovative Z-score analysis to offer clear, actionable trading signals. 🌊🎯
Key Features:
🔧 Customizable Parameters: Tailor the indicator to your trading needs with adjustable settings including Channel Length, Average Length, Overbought/Oversold Levels, and more.
📊 WaveTrend Oscillator: Utilizes a smoothed version of the average price to identify potential market reversals.
📉 Z-Score Analysis: Enhances signal reliability by measuring the standard deviation of the current price from the mean.
🎨 Dynamic Color Coding: Visual cues shift between up and down colors to indicate market trends, making it easy to read at a glance.
⚠️ Divergence Detection: Automatic identification of bullish and bearish divergences for early signal warnings.
🔔 Custom Alerts: Stay ahead with real-time alerts for key trading events like bullish/bearish divergences and trend reversals.
How to Use WaveTrend Ribbon :
Maximize your trading potential with the WaveTrend Ribbon by following these simple steps:
🔍 Add to Chart: Locate "WaveTrend Ribbon " in TradingView's Indicators & Strategies and apply it to your chart. Dive into the settings to customize the parameters like Channel Length, Average Length, and the Overbought/Oversold levels to match your trading strategy.
- Channel Length affects the sensitivity of the WaveTrend oscillator to price movements. A shorter Channel Length increases responsiveness, useful in volatile markets but may lead to false signals. It's ideal for traders looking for quick reactions to price changes.
- Average Length is used to smooth the oscillator further, influencing how quickly the indicator responds to trend changes. A shorter Average Length allows for a quicker response to the oscillator's movements, suitable for short-term trading strategies.
📊 Analyze the Market: Pay close attention to the color transitions and position of the Z-score in relation to its moving average for insights into market direction. Look out for the overbought and oversold conditions for potential reversal points.
🔔 Set Up Alerts: Utilize the built-in alert system to get notified of key events like trend reversals, bullish and bearish divergences, and more, so you can make timely decisions without having to constantly monitor the charts.
Basic Logic Explained:
The WaveTrend Ribbon is an advanced trading indicator that leverages the WaveTrend oscillator, enhanced by Z-score normalization and moving averages for precise market trend analysis. It calculates the average price deviation over a set period (Channel Length), smoothing it with an Average Length to identify trends. Z-score analysis further refines signals by comparing oscillator deviations against its historical performance, highlighting overbought or oversold conditions. The indicator generates signals for potential reversals and market entries/exits, visualized through dynamic color coding and customizable alerts for traders to act upon efficiently. This multi-layered approach provides a deeper insight into market dynamics, offering a blend of trend following and momentum strategies.
By highlighting overbought and oversold conditions with dynamic color changes and providing reversal signals, this indicator is a must-have tool for traders aiming to capitalize on market trends. 📈🚀
Elevate your trading experience with the WaveTrend Ribbon, your go-to indicator for navigating the markets with confidence and precision. Happy trading! 🌟🚀
HT: Waves LightIndicator visualizes waves, based on candlestick analysis (one-time-framing and price action concepts), eliminating subjectivity bias that often plagues manual charting of waves. It also doesn’t require much tuning to adjust for specific ticket unlike zigzag or other volatility-based indicators.
Waves can be used to detect current trend and assess its healthiness. For example, we can compare lengths of bullish and bearish waves to detect shift in power. Also, visualization of waves makes it easy to identify chart patterns such as double tops/bottoms, head-and-shoulders etc…
Another application is using waves’ pv points as reference levels to check for Change of Character. For example, in an uptrend higher low (HL) often acts as major support level. If broken it indicates a major change of character (i.e. possible trend reversal)
How it works?
Waves construction:
• Wave construction depends on the selected timeframe.
• Bullish wave lasts while every new candlestick low is higher than previous candlestick low. Breaking of this rule marks change of direction.
• Bearish wave lasts while every new candlestick high is lower than previous candlestick high. Breaking of this rule marks change of direction.
• Outside bars (when new high is higher than previous and new low is lower than previous) are interpreted as continuation of current direction unless counter-movement is really strong
• There is a time lag, measured in candlesticks, between actual direction change and when this change was detected (small triangle markers on the chart)
• Only confirmed bars are used for calculations.
Trend detection:
• Trend detection is based on price-action principle. Uptrend is marked by rising highs and lows; downtrend - by falling highs and lows. We need at least two highs and two lows to confirm trend.
• There are situations of uncertainty when we have higher low and lower high at the same time. They can resolve into continuation of the current trend or into its reversal. Such situations are drawn in gray color.
Pivot Points
Indicator does marking of pivot points based on their relative position - higher low (HL), lower low (LL), higher high (HH), lower high (LH) – and shows retracement level for correction waves.
Parameters:
• Allowance - allowance in ticks that must be exceeded to trigger direction reversal. E.g. if value = 10, then bullish wave ends when new candle low is 10 ticks lower than previous candle low (except for outside bars). Low values are recommended for lower timeframes and/or low volatility tickets; higher values – for higher timeframes and/or high volatility.
• Periods Back – number of candles back from the direction change signal to look for pivot low/high. In 90% of cases 5 is the optimal value but sometimes you might want to increase it for better fit (e.g. for low timeframes/low volatility)
Disclaimer
This indicator should not be used as a standalone tool to make trading decisions. It should be used in conjunction with other technical analysis methods.
