Gann + Laplace Smoothed Hybrid Volume Spread Analysis Indicator
This Indicator stands apart by integrating the principles of the upgraded Discrete Fourier Transform (DFT), the Laplace Stieltjes Transform and volume spread analysis, enhanced with a layer of Fourier smoothing to distill market noise and highlight trend directions with unprecedented clarity.
The length of EMA and Strategy Entries are modified with the Gann swings.
This smoothing process allows traders to discern the true underlying patterns in volume and price action, stripped of the distractions of short-term fluctuations and noise.
The core functionality of the GannLSHVSA revolves around the innovative combination of volume change analysis, spread determination (calculated from the open and close price difference), and the strategic use of the EMA (default 10) to fine-tune the analysis of spread by incorporating volume changes.
Trend direction is validated through a moving average (MA) of the histogram, which acts analogously to the Volume MA found in traditional volume indicators. This MA serves as a pivotal reference point, enabling traders to confidently engage with the market when the histogram's movement concurs with the trend direction, particularly when it crosses the Trend MA line, signalling optimal entry points.
It returns 0 when MA of the histogram and EMA of the Price Spread are not align.
WHAT IS GannLSHVSA INDICATOR:
The GannLSHVSA plots a positive trend when a positive Volume smoothed Spread and EMA of Volume smoothed price is above 0, and a negative when negative Volume smoothed Spread and EMA of Volume smoothed price is below 0. When this conditions are not met it plots 0.
ORIGINALITY & USEFULNESS:
The GannLSHVSA Strategy is unique because it applies upgraded DFT, the Laplace Stieltjes Transform for data smoothing, effectively filtering out the minor fluctuations and leaving traders with a clear picture of the market's true movements. The DFT's ability to break down market signals into constituent frequencies offers a granular view of market dynamics, highlighting the amplitude and phase of each frequency component. This, combined with the strategic application of Ehler's Universal Oscillator principles via a histogram, furnishes traders with a nuanced understanding of market volatility and noise levels, thereby facilitating more informed trading decisions. The Gann swing strategy is developed by meomeo105, this Gann high and low algorithm forms the basis of the EMA modification.
DETAILED DESCRIPTION:
My detailed description of the indicator and use cases which I find very valuable.
What is the meaning of price spread?
In finance, a spread refers to the difference between two prices, rates, or yields. One of the most common types is the bid-ask spread, which refers to the gap between the bid (from buyers) and the ask (from sellers) prices of a security or asset.
We are going to use Open-Close spread.
What is Volume spread analysis?
Volume spread analysis (VSA) is a method of technical analysis that compares the volume per candle, range spread, and closing price to determine price direction.
What does this mean?
We need to have a positive Volume Price Spread and a positive Moving average of Volume price spread for a positive trend. OR via versa a negative Volume Price Spread and a negative Moving average of Volume price spread for a negative trend.
What if we have a positive Volume Price Spread and a negative Moving average of Volume Price Spread?
It results in a neutral, not trending price action.
Thus the Indicator/Strategy returns 0 and Closes all long and short positions.
I suggest using "Close all" input False when fine-tuning Inputs for 1 TimeFrame. When you export data to Excel/Numbers/GSheets I suggest using "Close all" input as True, except for the lowest TimeFrame. I suggest using 100% equity as your default quantity for fine-tune purposes. I have to mention that 100% equity may lead to unrealistic backtesting results. Be avare. When backtesting for trading purposes use Contracts or USDT.
6 days ago
Release Notes
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[KVA] KMACDKMACD Indicator: Advanced Market Analysis Through Central Tendency Metrics
The KMACD (KAMVIA Moving Average Convergence Divergence) indicator is an advanced, multi-dimensional tool designed to provide traders and analysts with a deeper understanding of market dynamics. By integrating the classical MACD framework with statistical measures of central tendency, KMACD offers a sophisticated approach to identifying trends, reversals, and potential trading opportunities.
Key Features of the KMACD Indicator:
1. Enhanced MACD Calculation :
- The KMACD employs dual moving averages (fast and slow) of user-defined types (SMA, EMA, WMA) to calculate the MACD line, which represents the difference between these moving averages. This traditional approach is further enhanced by customizable signal smoothing, allowing users to fine-tune the sensitivity of the indicator.
2. Central Tendency Metrics :
- The indicator integrates additional statistical measures, such as Mean, Median, Mode, Standard Deviation, and Variance, calculated over a rolling window. These metrics provide insights into the central tendencies of the MACD values, helping traders understand the overall trend direction and the dispersion of price movements around the trend.
3. RSI-Like Oscillator :
- A unique RSI-like value derived from the MACD line is included to highlight overbought and oversold conditions. This offers a dual-layered perspective, combining the power of MACD and RSI methodologies, to signal potential market extremes with greater precision.
4. Customizable Visual Elements :
- KMACD allows users to toggle the visibility of the MACD line, Signal line, and Histogram, providing flexibility in how the data is presented. The histogram dynamically changes color—green when above zero, indicating bullish momentum, and red when below zero, indicating bearish momentum.
5. Horizontal Line Customization :
- The indicator includes customizable horizontal lines for the zero level, overbought, and oversold thresholds. These lines serve as visual cues to identify key price levels and market conditions.
6. Adaptive to Various Market Conditions :
- KMACD's comprehensive features make it adaptable to various market conditions, from trending markets to sideways consolidations. Whether you're looking to capture momentum shifts or identify potential reversal points, KMACD provides the analytical power needed to make informed trading decisions.
How to Use KMACD:
- Trend Identification : Use the MACD line in conjunction with central tendency measures (Mean, Median, Mode) to gauge the overall market trend and its strength. A rising MACD line, supported by higher mean and median values, typically indicates an uptrend.
- Momentum Analysis : The histogram and RSI-like value help in identifying the momentum behind price movements. Positive histogram bars suggest increasing bullish momentum, while negative bars suggest increasing bearish momentum.
- Overbought/Oversold Conditions : Monitor the RSI-like oscillator and the overbought/oversold levels to detect when the market may be poised for a reversal.
- Divergence Detection : Look for divergences between the MACD line and price action, supported by the central tendency measures, to spot potential reversal points.
Conclusion
The KMACD indicator is more than just a traditional MACD; it’s a comprehensive tool designed to cater to both novice and experienced traders. By incorporating central tendency metrics and customizable features, KMACD stands out as a versatile and powerful indicator that enhances market analysis and trading strategies. Whether you're navigating volatile markets or steady trends, KMACD offers the precision and depth needed to stay ahead.
Gann + Laplace Smoothed Hybrid Volume Spread AnalysisThe Gann + Laplace Smoothed Hybrid Volume Spread Analysis ( GannLSHVSA ) Strategy/Indicator is an trading tool designed to fuse volume analysis with trend detection, offering traders a view of market dynamics.
This Strategy/Indicator stands apart by integrating the principles of the upgraded Discrete Fourier Transform (DFT), the Laplace Stieltjes Transform and volume spread analysis, enhanced with a layer of Fourier smoothing to distill market noise and highlight trend directions with unprecedented clarity.
The length of EMA and Strategy Entries are modified with the Gann swings .
This smoothing process allows traders to discern the true underlying patterns in volume and price action, stripped of the distractions of short-term fluctuations and noise.
The core functionality of the GannLSHVSA revolves around the innovative combination of volume change analysis, spread determination (calculated from the open and close price difference), and the strategic use of the EMA (default 10) to fine-tune the analysis of spread by incorporating volume changes.
Trend direction is validated through a moving average (MA) of the histogram, which acts analogously to the Volume MA found in traditional volume indicators. This MA serves as a pivotal reference point, enabling traders to confidently engage with the market when the histogram's movement concurs with the trend direction, particularly when it crosses the Trend MA line, signalling optimal entry points.
It returns 0 when MA of the histogram and EMA of the Price Spread are not align.
WHAT IS GannLSHVSA INDICATOR:
The GannLSHVSA plots a positive trend when a positive Volume smoothed Spread and EMA of Volume smoothed price is above 0, and a negative when negative Volume smoothed Spread and EMA of Volume smoothed price is below 0. When this conditions are not met it plots 0.
HOW TO USE THE STRATEGY:
Here you fine-tune the inputs until you find a combination that works well on all Timeframes you will use when creating your Automated Trade Algorithmic Strategy. I suggest 4h, 12h, 1D, 2D, 3D, 4D, 5D, 6D, W and M.
ORIGINALITY & USEFULNESS:
The GannLSHVSA Strategy is unique because it applies upgraded DFT, the Laplace Stieltjes Transform for data smoothing, effectively filtering out the minor fluctuations and leaving traders with a clear picture of the market's true movements. The DFT's ability to break down market signals into constituent frequencies offers a granular view of market dynamics, highlighting the amplitude and phase of each frequency component. This, combined with the strategic application of Ehler's Universal Oscillator principles via a histogram, furnishes traders with a nuanced understanding of market volatility and noise levels, thereby facilitating more informed trading decisions. The Gann swing strategy is developed by meomeo105, this Gann high and low algorithm forms the basis of the EMA modification.
DETAILED DESCRIPTION:
My detailed description of the indicator and use cases which I find very valuable.
What is the meaning of price spread?
In finance, a spread refers to the difference between two prices, rates, or yields. One of the most common types is the bid-ask spread, which refers to the gap between the bid (from buyers) and the ask (from sellers) prices of a security or asset.
We are going to use Open-Close spread.
What is Volume spread analysis?
Volume spread analysis (VSA) is a method of technical analysis that compares the volume per candle, range spread, and closing price to determine price direction.
What does this mean?
We need to have a positive Volume Price Spread and a positive Moving average of Volume price spread for a positive trend. OR via versa a negative Volume Price Spread and a negative Moving average of Volume price spread for a negative trend.
What if we have a positive Volume Price Spread and a negative Moving average of Volume Price Spread?
It results in a neutral, not trending price action.
Thus the Indicator/Strategy returns 0 and Closes all long and short positions.
I suggest using "Close all" input False when fine-tuning Inputs for 1 TimeFrame. When you export data to Excel/Numbers/GSheets I suggest using "Close all" input as True, except for the lowest TimeFrame. I suggest using 100% equity as your default quantity for fine-tune purposes. I have to mention that 100% equity may lead to unrealistic backtesting results. Be avare. When backtesting for trading purposes use Contracts or USDT.
Bollinger Bands Fast Trend Indicator [DCD]Description:
The Bollinger Bands Fast Trend Detector indicator is an advanced tool designed to provide traders with more precise trend detection and clearer entry and exit signals. This script builds upon the traditional Bollinger Bands indicator by adding customizable standard deviations and incorporating multiple moving averages to enhance the accuracy of the signals.
Main Features:
1. **Customizable Bollinger Bands**:
- Each Bollinger Band has its own standard deviation setting, allowing for more granular control and better trend detection.
- The short Bollinger Band is set to a 10-period SMA for faster trend recognition.
2. **Multiple Moving Averages**:
- The indicator includes several types of moving averages (SMA, EMA, LSMA, HMA, WMA) applied to the Bollinger Trend value, giving traders flexibility to choose the best fit for their strategy.
3. **Crossover and Crossdown Detection**:
- The script identifies crossover and crossdown points between the Bollinger Trend value and the selected moving average, marking potential buy and sell signals with green and red circles, respectively.
4. **Color-Coded Histogram**:
- The histogram bars are color-coded to indicate the strength and direction of the trend, making it easy to visualize market conditions at a glance.
Instructions:
1. **Adding the Script to Your Chart**:
- Open your TradingView chart and add the Bollinger Bands Fast Trend Detector indicator.
2. **Adjusting Parameters**:
- Customize the Bollinger Bands and moving average settings according to your trading preferences:
- `Short BB Length` (default: 10): Adjusts the length of the short Bollinger Band.
- `Long BB Length` (default: 50): Adjusts the length of the long Bollinger Band.
- `StdDev` (for both bands): Sets the standard deviation multiplier.
- `Moving Average Type`: Choose between SMA, EMA, LSMA, HMA, and WMA.
- `Moving Average Length` (default: 14): Sets the length of the moving average.
3. **Interpreting the Output**:
- Observe the BBTrend and moving average plots on your chart.
- Look for green circles indicating crossover points (potential buy signals) and red circles indicating crossdown points (potential sell signals).
- Use the color-coded histogram bars to assess the strength and direction of the trend.
Configurable Parameters:
- `shortLengthInput` (default: 10): Length of the short Bollinger Band.
- `longLengthInput` (default: 50): Length of the long Bollinger Band.
- `shortDevMultInput` (default: 1.0): Standard deviation multiplier for the short Bollinger Band.
- `longDevMultInput` (default: 2.0): Standard deviation multiplier for the long Bollinger Band.
- `maTypeInput` (default: SMA): Type of moving average (options: SMA, EMA, LSMA, HMA, WMA).
- `maLengthInput` (default: 14): Length of the moving average.
Code Explanation:
The script calculates two sets of Bollinger Bands with distinct lengths and standard deviations. The difference between the lower bands and upper bands is normalized by the short middle band to compute the BBTrend value. A selected moving average is then applied to this BBTrend value. The script plots the BBTrend, the moving average, and uses color-coded histogram bars to represent trend strength and direction. It also identifies and marks crossover and crossdown points to provide potential trading signals.
Disclaimer:
This script is for educational purposes only and should not be considered financial advice. Always perform your own analysis before making any trading decisions.
Fine-Tune Inputs: Fourier Smoothed Hybrid Volume Spread AnalysisUse this Strategy to Fine-tune inputs for the HSHVSA Indicator.
Strategy allows you to fine-tune the indicator for 1 TimeFrame at a time; cross Timeframe Input fine-tuning is done manually after exporting the chart data.
I suggest using " Close all " input False when fine-tuning Inputs for 1 TimeFrame. When you export data to Excel/Numbers/GSheets I suggest using " Close all " input as True , except for the lowest TimeFrame.
MEANINGFUL DESCRIPTION:
The Fourier Smoothed Hybrid Volume Spread Analysis (FSHVSA) Strategy/Indicator is an innovative trading tool designed to fuse volume analysis with trend detection capabilities, offering traders a comprehensive view of market dynamics.
This Strategy/Indicator stands apart by integrating the principles of the Discrete Fourier Transform (DFT) and volume spread analysis, enhanced with a layer of Fourier smoothing to distill market noise and highlight trend directions with unprecedented clarity.
This smoothing process allows traders to discern the true underlying patterns in volume and price action, stripped of the distractions of short-term fluctuations and noise.
The core functionality of the FSHVSA revolves around the innovative combination of volume change analysis, spread determination (calculated from the open and close price difference), and the strategic use of the EMA (default 10) to fine-tune the analysis of spread by incorporating volume changes.
Trend direction is validated through a moving average (MA) of the histogram, which acts analogously to the Volume MA found in traditional volume indicators. This MA serves as a pivotal reference point, enabling traders to confidently engage with the market when the histogram's movement concurs with the trend direction, particularly when it crosses the Trend MA line, signalling optimal entry points.
It returns 0 when MA of the histogram and EMA of the Price Spread are not align.
WHAT IS FSHVSA INDICATOR:
The FSHVSA plots a positive trend when a positive Volume smoothed Spread and EMA of Volume smoothed price is above 0, and a negative when negative Volume smoothed Spread and EMA of Volume smoothed price is below 0. When this conditions are not met it plots 0.
HOW TO USE THE STRATEGY:
Here you fine-tune the inputs until you find a combination that works well on all Timeframes you will use when creating your Automated Trade Algorithmic Strategy. I suggest 4h, 12h, 1D, 2D, 3D, 4D, 5D, 6D, W and M.
ORIGINALITY & USEFULNESS:
The FSHVSA Strategy is unique because it applies DFT for data smoothing, effectively filtering out the minor fluctuations and leaving traders with a clear picture of the market's true movements. The DFT's ability to break down market signals into constituent frequencies offers a granular view of market dynamics, highlighting the amplitude and phase of each frequency component. This, combined with the strategic application of Ehler's Universal Oscillator principles via a histogram, furnishes traders with a nuanced understanding of market volatility and noise levels, thereby facilitating more informed trading decisions.
DETAILED DESCRIPTION:
My detailed description of the indicator and use cases which I find very valuable.
What is the meaning of price spread?
In finance, a spread refers to the difference between two prices, rates, or yields. One of the most common types is the bid-ask spread, which refers to the gap between the bid (from buyers) and the ask (from sellers) prices of a security or asset.
We are going to use Open-Close spread.
What is Volume spread analysis?
Volume spread analysis (VSA) is a method of technical analysis that compares the volume per candle, range spread, and closing price to determine price direction.
What does this mean?
We need to have a positive Volume Price Spread and a positive Moving average of Volume price spread for a positive trend. OR via versa a negative Volume Price Spread and a negative Moving average of Volume price spread for a negative trend.
What if we have a positive Volume Price Spread and a negative Moving average of Volume Price Spread?
It results in a neutral, not trending price action.
Thus the Indicator/Strategy returns 0 and Closes all long and short positions.
In the next Image you can see that trend is negative on 4h, we just move Negative on 12h and Positive on 1D. That means trend/Strategy flipped negative .
I am sorry, the chart is a bit messy. The idea is to use the indicator/strategy over more than 1 Timeframe.
Use this Strategy to fine-tune inputs for the HSHVSA Indicator.
(Strategy allows you to fine-tune the indicator for 1 TimeFrame at a time; cross Timeframe Input fine-tuning is done manually after exporting the chart data)
I suggest using " Close all " input False when fine-tuning Inputs for 1 TimeFrame. When you export data to Excel/Numbers/GSheets I suggest using " Close all " input as True , except for the lowest TimeFrame. I suggest using 100% equity as your default quantity for fine-tune purposes. I have to mention that 100% equity may lead to unrealistic backtesting results. Be avare. When backtesting for trading purposes use Contracts or USDT.
Fourier Smoothed Hybrid Volume Spread AnalysisIndicator id:
USER;91bdff47320b4284a375f428f683b21e
(only relevant to those that use API requests)
MEANINGFUL DESCRIPTION:
The Fourier Smoothed Hybrid Volume Spread Analysis (FSHVSA) indicator is an innovative trading tool designed to fuse volume analysis with trend detection capabilities, offering traders a comprehensive view of market dynamics.
This indicator stands apart by integrating the principles of the Discrete Fourier Transform (DFT) and volume spread analysis, enhanced with a layer of Fourier smoothing to distill market noise and highlight trend directions with unprecedented clarity.
This smoothing process allows traders to discern the true underlying patterns in volume and price action, stripped of the distractions of short-term fluctuations and noise.
The core functionality of the FSHVSA revolves around the innovative combination of volume change analysis, spread determination (calculated from the open and close price difference), and the strategic use of the EMA (default 10) to fine-tune the analysis of spread by incorporating volume changes.
Trend direction is validated through a moving average (MA) of the histogram, which acts analogously to the Volume MA found in traditional volume indicators. This MA serves as a pivotal reference point, enabling traders to confidently engage with the market when the histogram's movement concurs with the trend direction, particularly when it crosses the Trend MA line, signalling optimal entry points.
It returns 0 when MA of the histogram and EMA of the Price Spread are not align.
HOW TO USE THE INDICATOR:
The FSHVSA plots a positive trend when a positive Volume smoothed Spread and EMA of Volume smoothed price is above 0, and a negative when negative Volume smoothed Spread and EMA of Volume smoothed price is below 0. When this conditions are not met it plots 0.
ORIGINALITY & USEFULNESS:
The FSHVSA is unique because it applies DFT for data smoothing, effectively filtering out the minor fluctuations and leaving traders with a clear picture of the market's true movements. The DFT's ability to break down market signals into constituent frequencies offers a granular view of market dynamics, highlighting the amplitude and phase of each frequency component. This, combined with the strategic application of Ehler's Universal Oscillator principles via a histogram, furnishes traders with a nuanced understanding of market volatility and noise levels, thereby facilitating more informed trading decisions.
DETAILED DESCRIPTION:
My detailed description of the indicator and use cases which I find very valuable.
What is the meaning of price spread?
In finance, a spread refers to the difference between two prices, rates, or yields. One of the most common types is the bid-ask spread, which refers to the gap between the bid (from buyers) and the ask (from sellers) prices of a security or asset.
We are going to use Open-Close spread.
What is Volume spread analysis?
Volume spread analysis (VSA) is a method of technical analysis that compares the volume per candle, range spread, and closing price to determine price direction.
What does this mean?
We need to have a positive Volume Price Spread and a positive Moving average of Volume price spread for a positive trend. OR via versa a negative Volume Price Spread and a negative Moving average of Volume price spread for a negative trend.
What if we have a positive Volume Price Spread and a negative Moving average of Volume Price Spread ?
It results in a neutral, not trending price action.
Thus the indicator returns 0.
In the next Image you can see that trend is negative on 4h, neutral on 12h and neutral on 1D. That means trend is negative .
I am sorry, the chart is a bit messy. The idea is to use the indicator over more than 1 Timeframe.
What is approximation and smoothing?
They are mathematical concepts for making a discrete set of numbers a
continuous curved line.
Fourier and Euler approximation of a spread are taken from aprox library.
Key Features:
Noise Reduction leverages Euler's White noise capabilities for effective Volume smoothing, providing a cleaner and more accurate representation of market dynamics.
Choose between the innovative Double Discrete Fourier Transform (DTF32) and Regular Open & Close price series.
Mathematical equations presented in Pinescript:
Fourier of the real (x axis) discrete:
x_0 = array.get(x, 0) + array.get(x, 1) + array.get(x, 2)
x_1 = array.get(x, 0) + array.get(x, 1) * math.cos( -2 * math.pi * _dir / 3 ) - array.get(y, 1) * math.sin( -2 * math.pi * _dir / 3 ) + array.get(x, 2) * math.cos( -4 * math.pi * _dir / 3 ) - array.get(y, 2) * math.sin( -4 * math.pi * _dir / 3 )
x_2 = array.get(x, 0) + array.get(x, 1) * math.cos( -4 * math.pi * _dir / 3 ) - array.get(y, 1) * math.sin( -4 * math.pi * _dir / 3 ) + array.get(x, 2) * math.cos( -8 * math.pi * _dir / 3 ) - array.get(y, 2) * math.sin( -8 * math.pi * _dir / 3 )
Fourier of the imaginary (y axis) discrete:
y_0 = array.get(x, 0) + array.get(x, 1) + array.get(x, 2)
y_1 = array.get(x, 0) + array.get(x, 1) * math.sin( -2 * math.pi * _dir / 3 ) + array.get(y, 1) * math.cos( -2 * math.pi * _dir / 3 ) + array.get(x, 2) * math.sin( -4 * math.pi * _dir / 3 ) + array.get(y, 2) * math.cos( -4 * math.pi * _dir / 3 )
y_2 = array.get(x, 0) + array.get(x, 1) * math.sin( -4 * math.pi * _dir / 3 ) + array.get(y, 1) * math.cos( -4 * math.pi * _dir / 3 ) + array.get(x, 2) * math.sin( -8 * math.pi * _dir / 3 ) + array.get(y, 2) * math.cos( -8 * math.pi * _dir / 3 )
Euler's Smooth with Discrete Furrier approximated Volume.
a = math.sqrt(2) * math.pi / _devided
b = math.cos(math.sqrt(2) * 180 / _devided)
c2 = 2 * math.pow(a, 2) * b
c3 = math.pow(a, 4)
c1 = 1 - 2 * math.pow(a, 2) * math.cos(b) + math.pow(a, 4)
filt := na(filt ) ? 0 : c1 * (w + nz(w )) / 2.0 + c2 * nz(filt ) + c3 * nz(filt )
Usecase:
First option:
Leverage the script to identify Bullish and Bearish trends, shown with green and red triangle.
Combine Different Timeframes to accurately determine market trend.
Second option:
Pull the data with API sockets to automate your trading journey.
plot(close, title="ClosePrice", display=display.status_line)
plot(open, title="OpenPrice", display=display.status_line)
plot(greencon ? 1 : redcon ? -1 : 0, title="position", display=display.status_line)
Use ClosePrice, OpenPrice and "position" titles to easily read and backtest your strategy utilising more than 1 Time Frame.
Indicator id:
USER;91bdff47320b4284a375f428f683b21e
(only relevant to those that use API requests)
Nasan Rate of Change (ROC)**NOTE: FOR COMPARISON TRADITIONAL ROC IS PLOTTED WITH THE SAME ROC LENGTH OF 9. IT IS NOT PART OF THE INDICATOR"
The Nasan ROC indicator is smoothed version of the of the traditional ROC indicator. The Nasna ROC uses a triple pass moving average differencing strategy. A cumulative sum of the deviations obtained from the moving average differencing provides a smooth "noise free" trend and this cumulative sum of deviations is used for calculating ROC.
Let's break down the components and understand the indicator we discussed earlier:
Sequential Triple Pass Filter:
Three filters with lengths specified by length1, length2, and length3 are applied to the closing prices (close).
The filters involve calculating the cumulative sum of the differences between the closing prices and their respective moving averages.
The idea is to detrend the data and accumulate the deviations from the average over time, emphasizing longer-term trends.
Calculation of Rate of Change (ROC) of Cumulative Sum:
The Rate of Change (ROC) of the cumulative sum (rocCumulativeSum) is calculated using the ta.roc function with a specified length (rocLength).
ROC measures the percentage change in the cumulative sum over a specified period.
The ROC histogram provides insights into the momentum of the detrended series. Positive values suggest increasing momentum, while negative values suggest decreasing momentum.
Pay attention to the color of the histogram bars.
The histogram bars are colored green if the current ROC value is greater than or equal to the previous ROC value, and red otherwise.
This coloring is based on the concept that a positive ROC suggests upward momentum, while a negative ROC suggests downward momentum.
Volatility - Volume Impact:
The Average True Range (ATR) is calculated with a period of 14.
Volume strength is calculated as a factor (VCF) that considers the ratio of the simple moving average (SMA) of the current volume to the SMA of the volume over a longer period (144).
This volume factor (VCF) is then multiplied by ATR, creating a synergy with volatility and volume.
Visualization with Background Color Gradient:
A background color gradient is applied to the chart based on the calculated volume strength (f1).
The gradient color ranges from black (indicating low ATR and volume strength) to purple (indicating high ATR and volume strength). A low value indicates a ranging market with no significant price movements and it is safter to avoid signals generated from ROC histogram in these region.
Synergy of ROC and Volume Strength:
Observe how the ROC signals align with the background color gradient. For example, confirm whether positive ROC aligns with periods of high ATR and volume strength.
This synergy can provide confirmation or divergence signals, adding another layer of analysis.
Accumulation/Distribution Money Flow v1.0This indicator is intended to measure selling and buying pressure, calculates accumulation/distribution levels and suggests current trend intensity and direction.
Core calculations are based on open source script by cI8DH which was not updated ever since 2018. Also, it implements the technique to avoid price gaps issues as described in Twiggs® Money Flow .
The indicator can plot calculated A/D line, a smoothed A/D line and another smoother derivative from the smoothed line which serves as a signal line. By implementing crossovers detection between two lines and also measuring distance between them it plots the histogram of the difference and can also color chart bars accordingly.
You can also use settings to factor in price and/or volume into calculations.
Three options for visual color representation are available.
1) Simple color bars
In this case bars are colored in red and green by default, whereas green indicates positive distance between smoothed A/D line and signal line (upward movement), and red indicated negative distance (downward movement).
2) 4-color scheme
In this case pale green and pale red colors are added, whereas pale red used when the histogram is positive and A/D + signal lines are below zero lines (start of upward movement from lower levels), and pale green is where histogram is negative and both A/D and signal lines are above zero line (start of downward movement from top levels). Bright red and green colors indicate strong movement where the position of A/D + signal lines correspond to positive and.or negative histogram values. This option allows to visually track trend intensity more precisely.
3) Gradient bars color
In this scheme the candles are colored using gradient of either red or green color depending on the intensity and direction of the trend. For that color scheme you must specify the lookback parameter indicating number of bars back to determine highest/lowest values.
Enhanced TrixThe Enhanced Trix Confluence Oscillator involves utilizing two core components: a slow line and a difference histogram based on a shorter length. Another key aspect is the indicator using the DEMA for greater speed while the triple smoothing still provides accuracy which makes this different from the original indicator. This approach aims to rely on principles of both momentum and divergence.
The ETC aims to filter out market noise to reveal the core trend direction in both the short and medium term. A slow line is calculated using a longer time period with the double exponential moving average, which makes it less responsive to short-term price fluctuations and better at capturing longer-term momentum. It's best used to identify divergences with the asset's price, signaling potential reversals. The difference histogram serves as a more sensitive indicator for trade timing once further calibrated. It's calculated by taking the difference between the displayed length and a shorter period using the same calculation. This histogram also operates as a rate of change like the TRIX.
The slow line identifies broader trends and divergences, while the difference histogram offers a more granular view.
Zaree - Bull & Bear Volume VoidThe "Zaree - Bull & Bear Volume Void" (BBVV) indicator is a versatile tool designed to help traders assess the dynamics of bull and bear power in the market, with a focus on volume-based analysis. This indicator offers a range of features that aid in identifying potential shifts in market sentiment and strength.
Details of the Indicator:
Volume Void Color Settings: This indicator allows you to customize the colors used for different conditions, such as strong bull areas, slowing bull areas, strong bear areas, and slowing bear areas. These colors play a crucial role in visualizing the indicator's output.
Volume Void Settings: The BBVV indicator provides options for selecting specific volume void functions, which include "Relative Volume Comparison," "Percentage of Average Volume," "Fixed Volume Threshold," "Volatility-Adjusted Volume," "Compare to Previous Volume Bars," "Volume Percentile Rank," and "Market Session Comparison." Each function has its own criteria for evaluating volume conditions.
Void Bull Sensitivity and Void Bear Sensitivity: These are key parameters in the settings. The values you choose for void bull sensitivity and void bear sensitivity will significantly impact the background color displayed by the indicator. Properly configuring these values is crucial for the indicator's effectiveness.
Moving Average Settings: You can specify the source and length of moving averages used in the indicator. This helps in smoothing out data and providing a clearer picture of bull and bear power.
Void Color Background Conditions: The indicator dynamically changes the background color of the chart based on the current market conditions. It takes into account bull and bear power, as well as the configured sensitivity levels to determine whether the market is in a strong or slowing bull/bear phase.
MACD and Signal Lines: The indicator also displays MACD and signal lines on the chart, helping traders identify potential bullish and bearish crossovers.
Histogram Bars: Histogram bars are used to represent the strength of bull and bear power. Above-zero bars indicate bullish strength, while below-zero bars indicate bearish strength.
How to Use the Indicator:
Begin by customizing the color settings for different market conditions to your preference.
Select a volume void function that aligns with your trading strategy and objectives.
Configure the void bull sensitivity and void bear sensitivity values carefully. These values should reflect your desired sensitivity to volume conditions.
Choose the source and length of moving averages based on your analysis requirements.
Pay attention to the background color of the chart. It will change dynamically based on the current market conditions, providing insights into the strength of bull and bear power.
Observe the MACD and signal lines for potential bullish or bearish crossovers, which can be used as additional confirmation signals.
Interpret the histogram bars to gauge the strength of bull and bear power.
Example of Usage:
As a swing trader with a focus on volume analysis, you can use the BBVV indicator to enhance your trading decisions. Here's an example of how you might use the indicator:
Select "Relative Volume Comparison" as the volume void function to assess volume relative to a simple moving average.
Configure void bull sensitivity and void bear sensitivity to match your risk tolerance and trading style.
Choose "SMA" as the moving average type with a suitable length.
Pay attention to the background color changes in the chart. Strong bull areas may indicate potential bullish opportunities, while strong bear areas may signal bearish conditions.
Monitor the MACD and signal lines for potential crossovers, aligning them with the background color to validate your trading decisions.
Use the histogram bars to assess the strength of bull and bear power, helping you gauge market sentiment.
Remember that the BBVV indicator is a valuable tool to complement your trading strategy. It provides insights into volume dynamics and market conditions, allowing you to make informed trading choices.
Be sure to adjust the indicator settings according to your trading preferences and always consider the broader market context in your analysis.
RSI with J-Line ***For ease of use, I recommend changing the J Histogram to a line indicator, then it works like the KDJ Stochastic indicator. Full disclosure, I created this script with the help of GPT. This script was inspired by the KDJ Stochastic indicator by Dreadblitz***
The "RSI with J-Line" script is essentially a modified Relative Strength Index (RSI) indicator with an added histogram component. Here's how to use the different components of the script:
RSI Line (Blue): The RSI is a momentum oscillator that measures the speed and change of price movements. It oscillates between zero and 100, and is typically used to identify overbought and oversold conditions in a market. Traditionally, readings over 70 are considered overbought, and readings under 30 are considered oversold. However, these are not strict rules and can vary depending on the market and the overall trend.
RSI Smooth Line (Orange): This is the simple moving average of the RSI. It helps to smooth out the RSI and to identify the overall trend of the momentum. When the RSI line crosses above the RSI Smooth line, it might indicate that the momentum is moving upwards. When the RSI line crosses below the RSI Smooth line, it might indicate that the momentum is moving downwards.
RSI J-Line (Red Histogram): The J-Line is an additional line that's calculated as 3*rsiSmooth - 2*rsi. It's similar to the %J line in the Stochastic indicator and is designed to provide quicker signals than the RSI or RSI Smooth line. When the histogram is above the 0 line, it might indicate bullish momentum. When it's below the 0 line, it might indicate bearish momentum.
Please note that these interpretations are standard for these types of indicators, but actual market behavior can be complex and is influenced by many factors. Indicators should be used as part of a comprehensive trading strategy, not in isolation. Always take into account other market information and indicators before making trading decisions.
Volatility SpeedometerThe Volatility Speedometer indicator provides a visual representation of the rate of change of volatility in the market. It helps traders identify periods of high or low volatility and potential trading opportunities. The indicator consists of a histogram that depicts the volatility speed and an average line that smoothes out the volatility changes.
The histogram displayed by the Volatility Speedometer represents the rate of change of volatility. Positive values indicate an increase in volatility, while negative values indicate a decrease. The height of the histogram bars represents the magnitude of the volatility change. A higher histogram bar suggests a more significant change in volatility.
Additionally, the Volatility Speedometer includes a customizable average line that smoothes out the volatility changes over the specified lookback period. This average line helps traders identify the overall trend of volatility and its direction.
To enhance the interpretation of the Volatility Speedometer, color zones are used to indicate different levels of volatility speed. These color zones are based on predefined threshold levels. For example, green may represent high volatility speed, yellow for moderate speed, and fuchsia for low speed. Traders can customize these threshold levels based on their preference and trading strategy.
By monitoring the Volatility Speedometer, traders can gain insights into changes in market volatility and adjust their trading strategies accordingly. For example, during periods of high volatility speed, traders may consider employing strategies that capitalize on price swings, while during low volatility speed, they may opt for strategies that focus on range-bound price action.
Adjusting the inputs of the Volatility Speedometer indicator can provide valuable insights and flexibility to traders. By modifying the inputs, traders can customize the indicator to suit their specific trading style and preferences.
One input that can be adjusted is the "Lookback Period." This parameter determines the number of periods considered when calculating the rate of change of volatility. Increasing the lookback period can provide a broader perspective of volatility changes over a longer time frame. This can be beneficial for swing traders or those focusing on longer-term trends. On the other hand, reducing the lookback period can provide more responsiveness to recent volatility changes, making it suitable for day traders or those looking for short-term opportunities.
Another adjustable input is the "Volatility Measure." In the provided code, the Average True Range (ATR) is used as the volatility measure. However, traders can choose other volatility indicators such as Bollinger Bands, Standard Deviation, or custom volatility measures. By experimenting with different volatility measures, traders can gain a deeper understanding of market dynamics and select the indicator that best aligns with their trading strategy.
Additionally, the "Thresholds" inputs allow traders to define specific levels of volatility speed that are considered significant. Modifying these thresholds enables traders to adapt the indicator to different market conditions and their risk tolerance. For instance, increasing the thresholds may highlight periods of extreme volatility and help identify potential breakout opportunities, while lowering the thresholds may focus on more moderate volatility shifts suitable for range trading or trend-following strategies.
Remember, it is essential to combine the Volatility Speedometer with other technical analysis tools and indicators to make informed trading decisions.
MARS - Moving Average Relative StrengthThe original idea from this script is from the script " Percentage Relative Strength " by dman103 . The original script compared a symbol to an index by their everyday percentage change. The symbol percentage was subtracted from percentage change of the index, & the results were then smoothed by moving averages.
Instead of daily percentage changes, this script directly calculates relative strength via a moving average. We call this simpler approach as MARS (Moving Average Relative Strength) .
MARS compares a symbol to the index by making use of the price's distance from a moving average. By default, we compare the distance from the 50-day simple moving average of the stock vs that of the index. Both the type & the length of the moving average is customisable.
Background color indicates the index being above or below its moving average.
Blue background: index is above its moving average
Pink background: index is below its moving average
The histogram indicates whether the stock is under-performing or out-performing the index.
Up-bars : stock is out-performing the index i.e. between the stock & the index, the difference between the distance to/from the 50-day moving average is a positive value.
Down-bars : stock is under-performing the index i.e. between the stock & the index, the difference between the distance to/from the 50-day moving average is a negative value.
The color of the histogram indicates the type of out-performance or under-performance. There can be a total of 6 such colors:
Relative out-performance : both index & stock are bearish, but stock is less bearish. The script prints light green up-bars on a pink background.
Gross out-performance : both index & stock are bullish, but stock is more bullish. The script prints green up-bars on a blue background.
Absolute out-performance : index is bearish, but stock is bullish! The script prints blue up-bars on a pink background.
Relative under-performance : both index & stock are bullish, but stock is less bullish. The script prints light red bars on a blue background.
Gross under-performance : both index & stock are bearish, but stock is more bearish. The script prints dark red bars on a pink background.
Absolute under-performance : index is bullish, but stock is bearish! The script prints black down-bars on a blue background.
Additional customisation options:
Paint bars option changes the bar colors to mirror the histogram colors.
Easy colors option just changes the histogram colors to either blue or pink, indicating out-performance or under-performance, respectively. This is when the trader does not wish to demarcate between the above-mentioned 6 conditions.
Moving Average Convergence Divergence with Rate of Change
Purpose - MACD is an awesome indicator. However, I felt I could improve the existing MACD indicator by also letting it visualize the rate of change (ROC) of the histogram (whether rate of change is increasing or decreasing - just like a derivative). By doing so, the indicator will better show the rate of change of the trend.
How It's Done - To the original MACD indicator, I have added a bit more conditional statements that automatically calculates the ROC in MACD histogram and visualizes through 8 different colors.
Interpretation - While the histogram is above 0, darker color indicates the stronger up trend, and lighter the color, weaker the up trend and potentially indicates the bears are overtaking, and vice versa for the case where the histogram is below 0.
R-Smart - Relative Strength On observing the market for years I learned that Relative Strength will help us in staying invested in strong bullish stocks (relative to primary indices of your country, in my case it's Nifty 50 for India). Once you identify a strong stock, it's important to know if the stock is trending and is in momentum. To identify, trends and momentum, I used ADX and MACD indicators respectively as part of the R-Smart.
In R-Smart, I used Relative Strength primarily to plot the chart, if the Histogram is positive (greater than 0) then the security is bullish. But then how do we know that it's in trend and having momentum. Well the below color code will help you identify them
1. Histogram in Green : Strong Bullish
2. Histogram in Blue : Weak Bullish
3. Histogram in Orange: Bearish
Apart from the above indicator, I would like to use Super Trend to know the immediate support/resistances on the chart.
# StayInvested
# StayProfitable
# ManageYourRisk
Wave Trend OscillatorThis is a very standard version of the Wave Trend Oscillator.
The Channel and Average values are displayed as lines, most people display them as areas.
The Channel and Average difference is displayed as a histogram, most people display it as a tiny noisy area.
I was unable to find a standard version of the Wave Trend Oscillator.
The colorful hyped up versions of this indicator made me feel like a clown while using them.
I have essentially copied the style of the MACD with this indicator, to keep things professional.
With this WTO, you can change the timeframe and source.
You can also change the histogram average length and multiplier, making it usable.
The typical way that people display the histogram is completely unusable and just for appearance.
Now it does a decent job showing when the momentum of the WTO's downward movement is slowing down, just like how the MACD histogram works.
This indicator is essentially a normalized MACD, though they are calculated differently.
The Wave Trend Oscillator is useful for spotting/monitoring changed in mid-trend momentum.
In my experience, divergence in this indicator is a strong signal.
If the MACD is too slow for you, then this is a great alternative; without all the extra fluff people usually add to it.
MTF ComboMiddle stochastic is the HTF stochastic of price. The color coding indicates the trend in even higher timeframe.
- The graph on top is the stochastic of ATR (with HTF and current one with RSI and macd histogram).
- The green graph at the bottom is the stochastic of the OBV (with HTF and current one with RSI and macd histogram).
- Purple histogram and area underneath the mid-stochsatic are the macd histogram and the stochastic RSI.
- The dots in the middle are determined by the combined score of all
macd strategyOkay
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Rules using ( MACD 12 26 Close 9 ):
Place a SELL signal when :
1. Histogram bar turned RED from GREEN
2. Within the previous group of green histogram bars the maximum value reached/passed +5.5
3. MACD fast & slow have values > 0
Place a BUY signal when :
1. Histogram bar turned GREEN from RED
2. Within the previous group of RED histogram bars has maximum value reached/passed -5.0
3. MACD fast & slow have values < 0
Dynamic Dots Dashboard (a Cloud/ZLEMA Composite)The purpose of this indicator is to provide an easy-to-read binary dashboard of where the current price is relative to key dynamic supports and resistances. The concept is simple, if a dynamic s/r is currently acting as a resistance, the indicator plots a dot above the histogram in the red box. If a dynamic s/r is acting as support, a dot is plotted in the green box below.
There are some additional features, but the dot graphs are king.
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KEY:
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Currently the dynamic s/r's being used in the dot plots are:
Ichimoku Cloud:
Tenkan (blue)
Kijun (pink)
Senkou A (red)
Senkou B (green)
ZLEMA (Zero Lag Exponential Moving Average)
99 ZLEMA (lavender)
200 ZLEMA (salmon)
You'll see a dashed line through the middle of the resistances section (red) and supports section (green). Cloud indicators are plotted above the dashed line, and ZLEMA's are below.
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How it Works - Visual
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As stated in the intro - if a dynamic s/r is currently above the current price and acting as a resistance, the indicator plots a dot above the histogram in the red box. If a dynamic s/r is acting as support, a dot is plotted in the green box below. Additionally, there is an optional histogram (default is on) that will further visualize this relationship. The histogram is a simple summation of the resistances above and the supports below.
Here's a visual to assist with what that means. This chart includes all of those dynamic s/r's in the dynamic dot dashboard (the on-chart parts are individually added, not part of this tool).
You can see that as a dynamic support is lost, the corresponding dot is moved from the supports section at the bottom (green), to the resistances section at the top (red). The opposite being true as resistances are being overtaken (broken resistances are moved to the support section (red)). You can see that the raw chart is just... a mess. Which kinda of accentuates one of the key goals of this indicator: to get all that dynamic support info without a mess of a chart like that.
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How To Use It
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There are a lot of ways to use this information, but the most notable of which is to detect shifts in the market cycle.
For this example, take a look at the dynamic s/r dots in the resistances category (red background). You can see clearly that there are distinctive blocks of high density dots that have clear beginnings and ends. When we transition from a high density of dots to none in resistances, that means we are flipping them as support and entering a bull cycle. On the other hand, when we go from low density of dots as resistances to high density, we're pivoting to a bear cycle. Easy as that, you can quickly detect when market cycles are beginning or ending.
Alternatively, you can add your preferred linear SR's, fibs, etc. to the chart and quickly glance at the dashboard to gauge how dynamic SR's may be contributing to the risk of your trade.
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Who It's For
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New traders: by looking at dot density alone, you can use Dot Dynamics to spot transitionary phases in market cycles.
Experienced traders: keep your charts clean and the information easy to digest.
Developers: I created this originally as a starting point for more complex algos I'm working on. One algo is reading this dot dashboard and taking a position size relative to the s/r's above and below. Another cloud algo is using the results as inputs to spot good setups.
Colored Bars
There is an option (off by default, shown in the headline image above) to fill the bar colors based on how many dynamic s/r's are above or below the current price. This can make things easier for some users, confusing for others. I defaulted them to off as I don't want colors to confuse the primary value proposition of the indicators, which is the dot heat map. You can turn on colored bars in the settings.
One thing to note with the colored bars: they plot the color purely by the dot densities. Random spikes in the gradient colors (i.e. red to lime or green) can be a useful thing to notice, as they commonly occur at places where the price is bouncing between dynamic s/r's and can indicate a paradigm shift in the market cycle.
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Timeframes and Assets
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This can be used effectively on all assets (stocks, crypto, forex, etc) and all time frames. As always with any indicator, the higher TF's are generally respected more than lower TF's.
Thanks for checking it out! I've been trading crypto for years and am just now beginning to publish my ideas, secret-sauce scripts and handy tools (like this one). If you enjoyed this indicator and would like to see more, a like and a follow is greatly appreciated 😁.
Indicator: Raschke Compase [xQT5]This is an indicator from a book "Street Smarts—High Probability Short Term Trading Strategies" by L. Raschke & L.Connors.
I made it in histogram style for more comfortable reading chart:
- green histogram is buy signal or buy opportunity;
- red histogram is sell signal or sell opportunity;
- gray histogram is forward moving from last signal.
Enjoy it!
P-MACD by DGTPrice and Moving Averages Convergence/Divergence, shortly named as P-MACD
P-MACD is a trend-following momentum indicator that shows the relationship between Price and Long-term Moving Average (PMACD), and the relationship between two Moving Averages (MAMACD). P-MACD is composed of two lines, and an histogram, showing price distance (convergence/divergence) to its Long-term MA (PMACD), showing short-term MA distance (convergence/divergence) to long-term MA (MAMACD), and a histogram showing the difference (momentum) between the PMACD and MAMACD
The PMACD is calculated by dividing the Price to Long-term Moving Average (200-period SMA/EMA) and finally smoothed with 9-period SMA/EMA
- PMACD Line Formula : (Price / SlowMovingAverage -1) * 100 and smoothed with 9-period SMA/EMA
The MAMACD is calculated by dividing the Short-term Moving Average (such as 20 SMA/EMA) to the Long-term Moving Average (such as 200-period SMA/EMA)
- MAMACD Line Formula : (FastMovingAverage / SlowMovingAverage -1) * 100
The Histogram is calculated by subscripting PMACD and MAMACD
- Formula : PMACD - MAMACD
Optional
Trend Cloud calculated based on fast and slow version of MAMACD
What to look for:
- Line Crosses : PMACD Line can function as a trigger(signal) for buy and sell signals. Buy when the PMACD crosses above the MAMACD line and sell - or short - when the PMACD crosses below the MAMACD line
- Base Crosses : PMACD and/or MAMACD crosses above or below Baseline is another way to indicate the trend and momentum. MAMACD crosses of Baseline, MAMACD positive or negative, reflects short-term moving average crosses the long-term moving average and similarly, PMACD crosses of BaseLine, PMACD positive or negative, reflects price crosses a long-term moving average
- Momentum : P-MACD helps investors understand whether the bullish or bearish movement in the price is strengthening or weakening displayed with a histogram which graphs the distance between the PMACD and MAMACD. Additionally, upward momentum is confirmed with a bullish crossover, which occurs when PMACD and/or MAMACD crosses above Baseline. Conversely, downward momentum is confirmed with a bearish crossover, which occurs when PMACD and/or MAMACD crosses below Baseline
- Distance : Prices high above the moving average (MA) or low below it are likely to be remedied in the future by a reverse price movement. The more distant the PMACD is above or below its baseline indicates that the distance between the Price and its SMA is growing (regarding PMACD, You may find a detailed article explained in “Price Distance to its MA” indicator by DGT) . Similarly the more distant the MAMACD is above or below its baseline indicates that the distance between the two SMAs is growing
- Trend : A rising P-MACD indicates an uptrend, while a declining P-MACD indicates a downtrend
MACD vs. P-MACD
MACD measures the relationship between two MAs, while the P-MACD measures both the relationship between price and its MA, and the relationship between two MAs. MAMACD Line of P-MACD If set to same moving average type and same lengths as in MACD will produce the same line as MACD line, only values are represented as percentage with MAMACD. Both measure momentum in a market, but, because they measure different factors, they differentiate from each other even if they have similarities in presentation. P-MACD provides additional insights, not only to MA relation but also to Price and MA relation
Warning : Moving Average are calculated based on past prices, so they are lagging. The longer the time period for the moving average, the greater the lag as well as less sensitive to price changes. This study implements usage of 200-period long-term moving average, which implies that the P-MACD will provide insight especially for long-term trades, more suited for long-term trades, usage of P-MACD for short-term trades is recommend with lower timeframes (1H or lower).
Indicators aim to generate a potential signal/indication of an upcoming opportunity, but, the Indicators themselves do not guarantee the future movement of a given financial instrument, and are most useful when used in combination with other techniques.
Trading success is all about following your trading strategy and the indicators should fit within your trading strategy, and not to be traded upon solely
Disclaimer : The script is for informational and educational purposes only. Use of the script does not constitutes professional and/or financial advice. You alone the sole responsibility of evaluating the script output and risks associated with the use of the script. In exchange for using the script, you agree not to hold dgtrd tradingview user liable for any possible claim for damages arising from any decision you make based on use of the script
Big Picture 50/200Crazy as this may sound, it took 126 iterations to get something so simple sone right.
Big Picture helps offload some longer-term SMA lines off your chart so you can clutter it up again with some other stuff. It works by comparing SMAs 50 and 200 in histogram form. If the histogram is over the zero-line, 50 is over 200, and vice versa.
The histogram is green when the slope rises, suggesting that 50 is rising relative to 200. When the histogram turns red, 50 is falling.
Some Heikin-Ashi inspired averaging helps smooth the line just a little to help give a better idea as to overall trend.
Klinger Safety ZonesThis indicator is based on the Klinger Volume Oscillator, or KVO. The KVO is pretty cool since it can track long-term changes in money flow (both into and out of a market), as well as respond and predict short term price fluctuations.
The Klinger Oscillator determines the direction (or trend) of money flow based on the high, low, and closing price of the security. It then compares all three values (HLC/3) to the previous period’s values to determine how volume should be factored into the KVO. If the current period’s price is greater than that of the previous period, then volume is added. It is subtracted, however, if the price is less than the previous period. This utilization of volume is what makes it an accurate tracker of money flow and a valuable confirmation indicator. This value is often called volume force or the “trend” line.
A fast and slow EMA of the volume force are then calculated. The fast EMA has a smaller window length, while the slow EMA has a larger window. Traders can adjust the lengths of each EMA in the input option menu, but we chose the standard 55 and 34 period lengths as the default settings. We are finally left with the actual KVO value after subtracting the slow EMA from the fast EMA.
The Klinger Oscillator uses a signal line similar to the MACD and many other indicators. The default length for it is 13, but that length can also be adjusted in the input menu. A shorter length will result in more responsiveness but possibly more false signals and whipsaws.
The Chart and Interpretation:
The histogram shows the KVO series. Remember, since the Oscillator represents the difference between the fast and slow EMA, the KVO is bullish when it is greater than zero and bearish when it is less than zero.
When the KVO is greater than zero, the background on the chart is green, meaning that the trend is bullish and traders should look to go long. On the flip side, the background is red when the KVO is less than zero meaning traders should look to go short.
The aqua line plotted on top of the histogram is the signal line.
Here is a quick summary of the histogram colors:
(if KVO > 0 and KVO > signal)
then (color = teal)
if (KVO > 0 and KVO < signal)
then (color = lime)
if (KVO < 0 and KVO < signal)
then (color = red)
if (KVO < 0 and KVO > signal)
then (color = pink)
Users can choose to have the candles change color to match the KVO histogram color by adjusting the setting in the input menu.
~Happy (and safe) trading~
