BTC - Hotness Index

16 Okt 2023

### Script Description

#### BTC - Hotness Index

This Pine Script, version 4, aims to generate a "Hotness Index" for Bitcoin (BTC) trading by utilizing a Pi Cycle Top Indicator. The script operates in a daily (`1D`) time frame and involves calculating two Simple Moving Averages (SMA) based on `close` prices:

- 111-day SMA (`D_111SMA`)
- 350-day SMA (`D_350SMA`) multiplied by 2

The primary indicator (`pi_indicator`) is derived by dividing `D_111SMA` by `D_350SMA`.

##### Sell Signal
A sell signal is plotted as a histogram if `pi_indicator` crosses above 1 (`pi_plot` variable).

##### Buy Signal
A buy signal is plotted as a histogram if `pi_indicator` crosses below 0.35 (`pi_plot_buy` variable).

##### Horizontal Lines
Two horizontal lines are included to denote the "Buy Zone" and "Sell Zone":

- "Sell Zone" at `pi_indicator` level of 1
- "Buy Zone" at `pi_indicator` level of 0.35

##### Plotting
Histogram plots are used for visualizing the signals:
- Sell signals are colored red (`RGB: 255, 59, 59`)
- Buy signals are colored green (`RGB: 82, 255, 59`)

This script provides traders a visual guide for potential buy/sell opportunities based on the Pi Cycle Top Indicator and the Hotness Index for Bitcoin. It operates under the terms of the Mozilla Public License 2.0.

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Indexed in range 0 to 1