Moving Average Envelopes are percentage-based envelopes set above and below a moving average. The moving average, which forms the base for this indicator, can be a simple or exponential moving average. Each envelope is then set the same percentage above or below the moving average. This creates parallel bands that follow price action. With a moving average as the base, Moving Average Envelopes can be used as a trend following indicator. However, this indicator is not limited to just trend following. The envelopes can also be used to identify overbought and oversold levels when the trend is relatively flat.
You can change long to short in the Input Settings WARNING: - For purpose educate only - This script to change bars colors.
Thx for this work - I analysed this one - can you explain me these lines of code?
pos = iff(close > xHighBand, 1,
iff(close <xLowBand, -1, nz(pos[1], 0)))
possig = iff(reverse and pos == 1, -1,
iff(reverse and pos == -1, 1, pos))
Are you calculating the bearish or bullish?
TomBully
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When he close higher then the Upperbnad the you draw a green line when the close LowBand than you draw a red one - but waht is the reason behind?
HPotter
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@thebullcapital, This pos - for get trade signal 1-long -1 short. possig - for trade reverse.
JMVala_Trades
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Would it be possible to modify the backtest to go long on any test of the lowband at the time of the test versus upon the close of the candle?
HPotter
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@JMVala_Trades, Results will be incorrect, because backtest use open\close price for entry\exit. Your logic need to be tested on the realtime data.
MarketAlpha
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How do we select the stocks for trading MA envelope? High Beta or High Volatility stocks, which will go well? Please suggest.
pos = iff(close > xHighBand, 1,
iff(close <xLowBand, -1, nz(pos[1], 0)))
possig = iff(reverse and pos == 1, -1,
iff(reverse and pos == -1, 1, pos))
Are you calculating the bearish or bullish?