Nadaraya-Watson: Envelope (Non-Repainting) With MacD

3 時間前

Unlock advanced technical analysis with the Nadaraya-Watson: Envelope (Non-Repainting) With MACD indicator.

Combining the robust smoothing capabilities of the Nadaraya-Watson estimator with the momentum insights of the MACD (Moving Average Convergence Divergence), this powerful tool offers precise trend detection, dynamic envelope boundaries, and actionable crossover signals—all while ensuring non-repainting reliability.

Key Features

1. Nadaraya-Watson Estimator: Provides a smooth trend line (yhat_close) that effectively filters out market noise.
   Dynamic Envelopes: Utilizes ATR-based upper and lower boundaries that adapt to market volatility. MACD Integration: Incorporates customizable MACD settings to assess market momentum.
   Crossover Signals: Displays green crosses when the MACD signal line crosses above zero and red crosses when it crosses below zero.
   Non-Repainting: Ensures all signals are based on confirmed historical data, providing reliable and consistent indicators.
   Customizable Aesthetics: Offers extensive color and style options to match your charting preferences.

How to Use

1. Trend Identification:
    - Observe the Nadaraya-Watson Estimator (yhat_close) to determine the underlying trend direction.
    - Use the envelope boundaries to identify potential support and resistance levels based on market volatility. Momentum Confirmation:
    - Analyze the MACD line, signal line, and histogram to assess market momentum and potential trend reversals.
    - Look for changes in the MACD histogram to identify strengthening or weakening momentum. Crossover Signals:
    - Green Cross (✗): Consider bullish trades when the MACD signal line crosses above zero, especially if the price is above the Nadaraya-Watson trend line.
    - Red Cross (✗): Consider bearish trades when the MACD signal line crosses below zero, especially if the price is below the Nadaraya-Watson trend line. Envelope Interaction:
    - Monitor price interactions with the upper and lower envelope boundaries to identify potential breakout or reversal opportunities.

Customization Options

1. Kernel Settings: Adjust lookback window (h), relative weighting (alpha), and regression start bar (x_0) to tailor the estimator to different market conditions.
   MACD Settings: Modify fast and slow lengths, signal smoothing periods, and choose between SMA or EMA for moving averages.
   Envelope ATR Settings: Customize ATR length (atr_length) and near/far ATR factors (nearFactor & farFactor) to control envelope sensitivity.
   Color Settings: Select from a range of colors for trend lines, envelopes, and MACD components to enhance visual clarity.

I find that this works very well if you increase the 'timeframe' for the indicator to a higher time frame. Give this indicator a try!