Technical Probability MetrixThe provided Pine Script is a comprehensive trading tool called the "Technical Probability Metrix," designed for TradingView in Pine Script version 5. It integrates multiple technical indicators and advanced calculations to generate a probability score indicating the likelihood of bullish or bearish price movement. This study is helpful for traders seeking a consolidated market analysis from several technical perspectives in one integrated view.
How to Use This Script
• Apply the script to any chart on TradingView.
• Customize input parameters like wave detection period, Fibonacci levels, RSI length, MACD settings, stochastic length, and EMA periods to suit your trading style.
• Enable or disable display elements such as Elliott Wave labels, Fibonacci levels, and the summary table as needed.
• Observe the summary table that shows the status, values, strength progress bars, and probability percentages for each indicator category.
• Use the overall "Technical Probability Metrix" score and color-coded signals to determine trade bias and strength.
• Alerts are set up for strong buy/sell signals, trend changes, and EMA crossovers for real-time notification.
How It Is Helpful
• Unified Analysis: Combines momentum, trend, volume, and Fibonacci analysis in a single view, saving time and reducing indicator clutter.
• Probability Scores: Converts complex indicator data into probability percentages, allowing easier interpretation of market direction strength.
• Adaptive Targeting: Provides configurable probability levels indicating multiple targets based on the current trend strength.
• Trend Detection: Uses a trend scoring method combining linear regression, moving averages, and pivot highs/lows for a robust trend bias.
• Alert Conditions: Notifies users of key market signal changes to support timely decision-making.
• Volume and Order Blocks: Includes volume moving average and order block strength which are critical for validating price moves.
• Multi-Timeframe EMA Cross: Incorporates 15-minute EMA crossover analysis adding another confirmation layer.
Indicators Included and Their Role
• RSI (Relative Strength Index): Measures overbought/oversold conditions. Values >70 suggest overbought; <30 suggest oversold.
• MACD (Moving Average Convergence Divergence): Momentum and trend confirmation; bullish when MACD line crosses above signal line.
• Stochastic Oscillator: Identifies momentum and potential trend reversals; bullish when %K crosses above %D under 80.
• Volume Moving Average and Ratio: Detects unusual volume spikes which often precede price moves.
• VWAP (Volume Weighted Average Price): Determines if price is trading above or below average price weighted by volume, indicating institutional interest.
• Order Block Strength: Highlights key supply/demand zones from recent high/low ranges.
• EMA 9/20 Crossover (on 15-min): Short and medium-term trend signals for finer timing.
• Elliott Wave Pivots: Detects significant wave highs and lows to assess price position within swing structures.
• Trend Metrics: Combines moving averages, linear regression slope, higher highs/lows, and bar comparisons to score market trend strength.
How to Analyze Using This Study
• Look for alignment among the indicators: bullish RSI, MACD, stochastic, and volume with positive trend scores and price above VWAP suggest a strong buy.
• Use the probability percentages and progress bars to gauge the power behind signals.
• Observe the overall signal (Strong Buy, Buy, Neutral, Sell, Strong Sell) and corresponding color for quick visual cues.
• Fibonacci levels and wave counts provide context about price targets and retracement zones.
• Alerts notify when conditions for strong entry or exit signals occur, complementing manual analysis.
Benefits for New Traders
• Simplifies Complex Data: Merges multiple technical tools into one dashboard, reducing confusion from using many separate indicators.
• Visual Progress Bars and Status: Easy-to-understand visualization of each indicator’s strength and market probability.
• Educative Value: Shows how classic indicators combine into an overall market assessment, useful for learning indicator interactions.
• Alerts: Helps beginners by signaling trading opportunities without needing constant manual chart monitoring.
• Adjustable Settings: Allows users to experiment with input values and observe how indicators respond.
Disclaimer from aiTrendview
This script and its trading signals are provided for training and educational purposes only. They do not constitute financial advice or a guaranteed trading system. Trading involves substantial risk, and there is the potential to lose all invested capital. Users should perform their own analysis and consult with qualified financial professionals before making any trading decisions. aiTrendview disclaims any liability for losses incurred from using this code or trading based on its signals. Use this tool responsibly, and trade only with risk capital.
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Volume Trend AnalysisStudy Material for Volume Trend Analysis Dashboard
1. Introduction
This script is a complete volume-based technical analysis dashboard designed in TradingView, created under the guidelines of TradingView and aiTrendview. It combines multiple indicators—Volume, RSI, Supertrend, Buy/Sell Pressure, and Momentum—into a single visual dashboard.
The purpose is education and market observation, not guaranteed profits. Students using this tool should focus on understanding patterns, signals, and probabilities rather than treating them as fixed rules.
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2. Core Components and Indicators
🔹 Volume Analysis
• Volume shows the number of shares/contracts traded in a specific period.
• The script compares today’s volume with historical averages (e.g., 20-day average).
• This helps identify whether trading activity is higher or lower than usual.
• Learning use: A student can track if high volume confirms a price breakout or if low volume suggests weak conviction.
• Combination:
o High price rise + High volume → Strong bullish move.
o Price rise + Low volume → Weak rally, may fail.
o Price fall + High volume → Strong selling pressure.
o Price fall + Low volume → Weak decline, may reverse.
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🔹 RSI (Relative Strength Index)
• RSI measures momentum (0–100 scale).
• Above 70 = Overbought (possible selling zone).
• Below 30 = Oversold (possible buying zone).
• Around 50 = Neutral, sideways market.
• Learning use: Combine with volume—RSI near extremes with high volume often marks turning points.
• Combination:
o RSI < 30 + High buy pressure volume = Strong bounce probability.
o RSI > 70 + High sell pressure volume = Risk of reversal downward.
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🔹 Supertrend
• Supertrend uses volatility (ATR) to show support/resistance bands.
• Price above = Bullish trend.
• Price below = Bearish trend.
• Learning use: New students can treat it as a dynamic stop-loss and trailing tool.
• Combination:
o Price > Supertrend + RSI > 50 + High buy volume = Safe bullish trend.
o Price < Supertrend + RSI < 50 + High sell volume = Safe bearish trend.
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🔹 Buy/Sell Pressure
• The indicator splits volume into buying vs. selling portions based on price action.
• Shows % of buying volume vs. selling volume.
• Learning use: Students can visualize whether bulls or bears are dominating.
• Combination:
o Buying > 65% → Bulls stronger.
o Selling > 65% → Bears stronger.
o Balanced → Market indecisive (range-bound).
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🔹 Momentum & Signal Status
• Momentum combines RSI and Supertrend to classify market as Bullish, Bearish, or Neutral.
• Buy/Sell signals are triggered on crossovers of price with Supertrend along with RSI conditions.
• Learning use: Beginners should not blindly trade these signals but track how often they succeed/fail under different market conditions.
• Combination:
o Bullish Momentum + Buy Signal + High Volume = Strong entry setup.
o Bearish Momentum + Sell Signal + High Volume = Strong short setup.
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🔹 Volume Pace
• Compares current intraday volume with expected average progress.
• Above pace = Traders active earlier than usual.
• Below pace = Weak interest in current session.
• Learning use: Beginners can track whether moves are backed by real activity or just price manipulation.
• Combination:
o Above pace + Bullish signals = Reliable rally.
o Below pace + Bullish signals = Weak rally, avoid.
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3. How to Use the Dashboard
• The dashboard consolidates all indicators into a simple table: Signals, Momentum, Position, Profit, Volume, Pressure, Levels, and Status.
• It helps beginners see different aspects of market condition at one glance.
• Instead of jumping between multiple charts, everything is available in one panel.
• Students can use this to practice observation, backtest signals, and record outcomes.
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4. Educational Guidelines
1. Paper Trade First: Always test on virtual trading accounts before real money.
2. Record Outcomes: Note how each signal works in trending vs. sideways markets.
3. Combine with Chart Reading: This is not standalone—students must learn candlestick patterns, support/resistance, and fundamentals.
4. Avoid Overtrading: Just because a dashboard flashes “BUY” doesn’t mean to enter blindly.
5. Adapt Timeframes: Learn the difference between intraday vs. daily signals. Shorter timeframes = more noise.
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5. Common Beginner Mistakes
• Blind Trading: Treating BUY/SELL signals as automatic entry/exit without analysis.
• Ignoring Volume: Not checking whether signals are backed by strong or weak volume.
• Overconfidence: Assuming 100% accuracy—no indicator is perfect.
• Misusing Alerts: Alerts help monitoring but don’t guarantee profitability.
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6. Disclaimer
This indicator is created strictly for educational and learning purposes under TradingView and aiTrendview guidelines.
• It is not financial advice and should not be treated as a guaranteed profit-making tool.
• Past performance does not guarantee future results.
• Misuse of this indicator for blind speculation can result in financial loss.
• Always use it with proper risk management and independent judgment.
• For real trading decisions, consult a certified financial advisor.
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✅ By studying this dashboard, students gain exposure to:
• How multiple indicators interact.
• How volume confirms or rejects price moves.
• How to build discipline by observing signals, not chasing them.
This makes the tool a training ground for market observation rather than a shortcut to quick profits.
Easy MA SignalsEasy MA Signals
Overview
Easy MA Signals is a versatile Pine Script indicator designed to help traders visualize moving average (MA) trends, generate buy/sell signals based on crossovers or custom price levels, and enhance chart analysis with volume-based candlestick coloring. Built with flexibility in mind, it supports multiple MA types, crossover options, and customizable signal appearances, making it suitable for traders of all levels. Whether you're a day trader, swing trader, or long-term investor, this indicator provides actionable insights while keeping your charts clean and intuitive.
Configure the Settings
The indicator is divided into three input groups for ease of use:
General Settings:
Candlestick Color Scheme: Choose from 10 volume-based color schemes (e.g., Sapphire Pulse, Emerald Spark) to highlight high/low volume candles. Select “None” for TradingView’s default colors.
Moving Average Length: Set the MA period (default: 20). Adjust for faster (lower values) or slower (higher values) signals.
Moving Average Type: Choose between SMA, EMA, or WMA (default: EMA).
Show Buy/Sell Signals: Enable/disable signal plotting (default: enabled).
Moving Average Crossover: Select a crossover type (e.g., MA vs VWAP, MA vs SMA50) for signals or “None” to disable.
Volume Influence: Adjust how volume impacts candlestick colors (default: 1.2). Higher values make thresholds stricter.
Signal Appearance Settings:
Buy/Sell Signal Shape: Choose shapes like triangles, arrows, or labels for signals.
Buy/Sell Signal Position: Place signals above or below bars.
Buy/Sell Signal Color: Customize colors for better visibility (default: green for buy, red for sell).
Custom Price Alerts:
Custom Buy/Sell Alert Price: Set specific price levels for alerts (default: 0, disabled). Enter a non-zero value to enable.
Set Up Alerts
To receive notifications (e.g., sound, popup, email) when signals or custom price levels are hit:
Click the Alert button (alarm clock icon) in TradingView.
Select Easy MA Signals as the condition and choose one of the four alert types:
MA Crossover Buy Alert: Triggers on MA crossover buy signals.
MA Crossover Sell Alert: Triggers on MA crossover sell signals.
Custom Buy Alert: Triggers when price crosses above the custom buy price.
Custom Sell Alert: Triggers when price crosses below the custom sell price.
Enable Play Sound and select a sound (e.g., “Bell”).
Set the frequency (e.g., Once Per Bar Close for confirmed signals) and create the alert.
Analyze the Chart
Moving Average Line: Displays the selected MA with color changes (green for bullish, red for bearish, gray for neutral) based on price position relative to the MA.
Buy/Sell Signals: Appear as shapes or labels when crossovers or custom price levels are hit.
Candlestick Colors: If a color scheme is selected, candles change color based on volume strength (high, low, or neutral), aiding in trend confirmation.
Why Use Easy MA Signals?
Easy MA Signals is designed to simplify technical analysis while offering advanced customization. It’s ideal for traders who want:
A clear visualization of MA trends and crossovers.
Flexible signal generation based on MA crossovers or custom price levels.
Volume-enhanced candlestick coloring to identify market strength.
Easy-to-use settings with tooltips for beginners and pros alike.
This script is particularly valuable because it combines multiple features into one indicator, reducing chart clutter and providing actionable insights without overwhelming the user.
Benefits of Easy MA Signals
Highly Customizable: Supports SMA, EMA, and WMA with adjustable lengths.
Offers multiple crossover options (VWAP, SMA10, SMA20, etc.) for tailored strategies.
Custom price alerts allow precise targeting of key levels.
Volume-Based Candlestick Coloring: 10 unique color schemes highlight volume strength, helping traders confirm trends.
Adjustable volume influence ensures adaptability to different markets.
Flexible Signal Visualization: Choose from various signal shapes (triangles, arrows, labels) and positions (above/below bars).
Customizable colors improve visibility on any chart background.
Alert Integration: Built-in alert conditions for crossovers and custom prices support sound, email, and app notifications.
Easy setup for real-time trading decisions.
User-Friendly Design: Organized input groups with clear tooltips make configuration intuitive.
Suitable for beginners and advanced traders alike.
Example Use Cases
Swing Trading with MA Crossovers:
Scenario: A trader wants to trade Bitcoin (BTC/USD) on a 4-hour chart using an EMA crossover strategy.
Setup:
Set Moving Average Type to EMA, Length to 20.
Set Moving Average Crossover to “MA vs SMA50”.
Enable Show Buy/Sell Signals and choose “arrowup” for buy, “arrowdown” for sell.
Select “Emerald Spark” for candlestick colors to highlight volume surges.
Usage: Buy when the EMA20 crosses above the SMA50 (green arrow appears) and volume is high (dark green candles). Sell when the EMA20 crosses below the SMA50 (red arrow). Set alerts for real-time notifications.
Scalping with Custom Price Alerts:
Scenario: A day trader monitors Tesla (TSLA) on a 5-minute chart and wants alerts at specific support/resistance levels.
Setup:
Set Custom Buy Alert Price to 150.00 (support) and Custom Sell Alert Price to 160.00 (resistance).
Use “labelup” for buy signals and “labeldown” for sell signals.
Keep Moving Average Crossover as “None” to focus on price alerts.
Usage: Receive a sound alert and label when TSLA crosses 150.00 (buy) or 160.00 (sell). Use volume-colored candles to confirm momentum before entering trades.
When NOT to Use Easy MA Signals
High-Frequency Trading: Reason: The indicator relies on moving averages and volume, which may lag in ultra-fast markets (e.g., sub-second trades). High-frequency traders may need specialized tools with real-time tick data.
Alternative: Use order book or market depth indicators for faster execution.
Low-Volatility or Sideways Markets:
Reason: MA crossovers and custom price alerts can generate false signals in choppy, range-bound markets, leading to whipsaws.
Alternative: Use oscillators like RSI or Bollinger Bands to trade within ranges.
This indicator is tailored more towards less experienced traders. And as always, paper trade until you are comfortable with how this works if you're unfamiliar with trading! We hope you enjoy this and have great success. Thanks for your interested in Easy MA Signals!
20/50 SMA Cross 200 SMAThis Pine Script code is designed to identify and visualize crossovers of two shorter-term Simple Moving Averages (SMAs), a 20-period SMA and a 50-period SMA, with a longer-term 200-period SMA on a price chart. It also includes alerts for these crossover events. Here's a breakdown:
**Purpose:**
The core idea behind this script is to detect potential trend changes. Crossovers of shorter-term moving averages over a longer-term moving average are often interpreted as bullish signals, while crossovers below are considered bearish.
**Key Components:**
1. **Moving Average Calculation:**
* `sma20 = ta.sma(close, 20)`: Calculates the 20-period SMA of the closing price.
* `sma50 = ta.sma(close, 50)`: Calculates the 50-period SMA of the closing price.
* `sma200 = ta.sma(close, 200)`: Calculates the 200-period SMA of the closing price.
2. **Crossover Detection:**
* `crossUp20 = ta.crossover(sma20, sma200)`: Returns `true` when the 20-period SMA crosses above the 200-period SMA.
* `crossDown20 = ta.crossunder(sma20, sma200)`: Returns `true` when the 20-period SMA crosses below the 200-period SMA.
* Similar logic applies for `crossUp50` and `crossDown50` with the 50-period SMA.
3. **Recent Crossover Tracking (Crucial Improvement):**
* `lookback = 7`: Defines a lookback period of 7 bars.
* `var bool hasCrossedUp20 = false`, etc.: Declares `var` (persistent) boolean variables to track if a crossover has occurred *within* the last 7 bars. This is the most important correction from previous versions.
* The logic using `ta.barssince()` is the key:
* If a crossover happens (`crossUp20` is true), the corresponding `hasCrossedUp20` is set to `true`.
* If no crossover happens on the current bar, it checks if a crossover happened within the last 7 bars using `ta.barssince(crossUp20) <= lookback`. If so, it keeps `hasCrossedUp20` as `true`. After 7 bars, it becomes `false`.
4. **Plotting Crossovers:**
* `plotshape(...)`: Plots circles on the chart to visually mark the crossovers.
* Green circles below the bars for bullish crossovers (20 and 50).
* Red circles above the bars for bearish crossovers (20 and 50).
* Different shades of green/red (green/lime, red/maroon) distinguish between 20 and 50 SMA crossovers.
5. **Plotting Moving Averages (Optional but Helpful):**
* `plot(sma20, color=color.blue, linewidth=1)`: Plots the 20-period SMA in blue.
* Similar logic for the 50-period SMA (orange) and 200-period SMA (gray).
6. **Alerts:**
* `alertcondition(...)`: Triggers alerts when crossovers occur. This is essential for real-time trading signals.
**How it Works (in Simple Terms):**
The script continuously calculates the 20, 50, and 200 SMAs. It then monitors for instances where the 20 or 50 SMA crosses the 200 SMA. When such a crossover happens, a colored circle is plotted on the chart, and an alert is triggered. The key improvement is that it remembers if a crossover occurred in the last 7 bars and continues to display the circle during that period.
**Use Case:**
Traders use this type of indicator to identify potential entry and exit points in the market. A bullish crossover (shorter SMA crossing above the longer SMA) might be a signal to buy, while a bearish crossover might be a signal to sell.
**Key Improvements over Previous Versions:**
* **Correct Lookback Implementation:** The use of `ta.barssince()` and `var` variables is the correct and efficient way to check for crossovers within a lookback period. This fixes the major flaw in earlier versions.
* **Clear Visualizations:** The use of `plotshape` with distinct colors makes it easy to distinguish between 20 and 50 SMA crossovers.
* **Alerts:** The inclusion of alerts makes the script much more practical for real-time trading.
This improved version provides a robust and useful tool for identifying and tracking SMA crossovers.
MA RSI MACD Signal SuiteThis Pine Script™ is designed for use in Trading View and generates trading signals based on moving average (MA) crossovers, RSI (Relative Strength Index) signals, and MACD (Moving Average Convergence Divergence) indicators. It provides visual markers on the chart and can be configured to suit various trading strategies.
1. Indicator Overview
The indicator includes signals for:
Moving Averages (MA): It tracks crossovers between different types of moving averages.
RSI: Signals based on RSI crossing certain levels or its signal line.
MACD: Buy and sell signals generated by MACD crossovers.
2. Inputs and Customization
Moving Averages (MAs):
You can customize up to 6 moving averages with different types, lengths, and colors.
MA Type: Choose from different types of moving averages:
SMA (Simple Moving Average)
EMA (Exponential Moving Average)
HMA (Hull Moving Average)
SMMA (RMA) (Smoothed Moving Average)
WMA (Weighted Moving Average)
VWMA (Volume Weighted Moving Average)
T3, DEMA, TEMA
Source: Select the price to base the MA on (e.g., close, open, high, low).
Length: Define the number of periods for each moving average.
Examples:
MA1: Exponential Moving Average (EMA) with a period of 9
MA2: Exponential Moving Average (EMA) with a period of 21
RSI Settings:
RSI is calculated based on a user-defined period and is used to identify potential overbought or oversold conditions.
RSI Length: Lookback period for RSI (default 14).
Overbought Level: Defines the overbought threshold for RSI (default 70).
Oversold Level: Defines the oversold threshold for RSI (default 30).
You can also adjust the smoothing for the RSI signal line and customize when to trigger buy and sell signals based on the RSI crossing these levels.
MACD Settings:
MACD is used for identifying changes in momentum and trends.
Fast Length: The period for the fast moving average (default 12).
Slow Length: The period for the slow moving average (default 26).
Signal Length: The period for the signal line (default 9).
Smoothing Method: Choose between SMA or EMA for both the MACD and the signal line.
3. Signal Logic
Moving Average (MA) Crossover Signals:
Crossover: A bullish signal is generated when a fast MA crosses above a slow MA.
Crossunder: A bearish signal is generated when a fast MA crosses below a slow MA.
The crossovers are plotted with distinct colors, and the chart will display markers for these crossover events.
RSI Signals:
Oversold Crossover: A bullish signal when RSI crosses over its signal line below the oversold level (30).
Overbought Crossunder: A bearish signal when RSI crosses under its signal line above the overbought level (70).
RSI signals are divided into:
Aggressive (Early) Entries: Signals when RSI is crossing the oversold/overbought levels.
Conservative Entries: Signals when RSI confirms a reversal after crossing these levels.
MACD Signals:
Buy Signal: Generated when the MACD line crosses above the signal line (bullish crossover).
Sell Signal: Generated when the MACD line crosses below the signal line (bearish crossunder).
Additionally, the MACD histogram is used to identify momentum shifts:
Rising to Falling Histogram: Alerts when the MACD histogram switches from rising to falling.
Falling to Rising Histogram: Alerts when the MACD histogram switches from falling to rising.
4. Visuals and Alerts
Plotting:
The script plots the following on the price chart:
Moving Averages (MA): The selected MAs are plotted as lines.
Buy/Sell Shapes: Triangular markers are displayed for buy and sell signals generated by RSI and MACD.
Crossover and Crossunder Markers: Crosses are shown when two MAs crossover or crossunder.
Alerts:
Alerts can be configured based on the following conditions:
RSI Signals: Alerts for oversold or overbought crossover and crossunder events.
MACD Signals: Alerts for MACD line crossovers or momentum shifts in the MACD histogram.
Alerts are triggered when specific conditions are met, such as:
RSI crosses over or under the oversold/overbought levels.
MACD crosses the signal line.
Changes in the MACD histogram.
5. Example Usage
1. Trend Reversal Setup:
Buy Signal: Use the RSI oversold crossover and MACD bullish crossover to identify potential entry points in a downtrend.
Sell Signal: Use the RSI overbought crossunder and MACD bearish crossunder to identify potential exit points or short entries in an uptrend.
2. Momentum Strategy:
Combine MACD and RSI signals to identify the strength of a trend. Use MACD histogram analysis and RSI levels for confirmation.
3. Moving Average Crossover Strategy:
Focus on specific MA crossovers, such as the 9-period EMA crossing above the 21-period EMA, for buy signals. When a longer-term MA (e.g., 50-period) crosses a shorter-term MA, it may indicate a strong trend change.
6. Alerts Conditions
The script includes several alert conditions, which can be triggered and customized based on the user’s preferences:
RSI Oversold Crossover: Alerts when RSI crosses over the signal line below the oversold level (30).
RSI Overbought Crossunder: Alerts when RSI crosses under the signal line above the overbought level (70).
MACD Buy/Sell Crossover: Alerts when the MACD line crosses the signal line for a buy or sell signal.
7. Conclusion
This script is highly customizable and can be adjusted to suit different trading strategies. By combining MAs, RSI, and MACD, traders can gain multiple perspectives on the market, enhancing their ability to identify potential buy and sell opportunities.
Reverse Cutlers Relative Strength Index On ChartIntroduction
The Reverse Cutlers Relative Strength Index (RCRSI) OC is an indicator which tells the user what price is required to give a particular Cutlers Relative Strength Index ( RSI ) value, or cross its Moving Average (MA) signal line.
Overview
Background & Credits:
The relative strength index ( RSI ) is a momentum indicator used in technical analysis that was originally developed by J. Welles Wilder Jr. and introduced in his seminal 1978 book, “New Concepts in Technical Trading Systems.”.
Cutler created a variation of the RSI known as “Cutlers RSI” using a different formulation to avoid an inherent accuracy problem which arises when using Wilders method of smoothing.
Further developments in the use, and more nuanced interpretations of the RSI have been developed by Cardwell, and also by well-known chartered market technician, Constance Brown C.M.T., in her acclaimed book "Technical Analysis for the Trading Professional” 1999 where she described the idea of bull and bear market ranges for RSI , and while she did not actually reveal the formulas, she introduced the concept of “reverse engineering” the RSI to give price level outputs.
Renowned financial software developer, co-author of academic books on finance, and scientific fellow to the Department of Finance and Insurance at the Technological Educational Institute of Crete, Giorgos Siligardos PHD . brought a new perspective to Wilder’s RSI when he published his excellent and well-received articles "Reverse Engineering RSI " and "Reverse Engineering RSI II " in the June 2003, and August 2003 issues of Stocks & Commodities magazine, where he described his methods of reverse engineering Wilders RSI .
Several excellent Implementations of the Reverse Wilders Relative Strength Index have been published here on Tradingview and elsewhere.
My utmost respect, and all due credits to authors of related prior works.
Introduction
It is worth noting that while the general RSI formula, and the logic dictating the UpMove and DownMove data series has remained the same as the Wilders original formulation, it has been interpreted in a different way by using a different method of averaging the upward, and downward moves.
Cutler recognized the issue of data length dependency when using wilders smoothing method of calculating RSI which means that wilders standard RSI will have a potential initialization error which reduces with every new data point calculated meaning early results should be regarded as unreliable until enough calculation iterations have occurred for convergence.
Hence Cutler proposed using Simple Moving Averaging for gain and loss data which this Indicator is based on.
Having "Reverse engineered" prices for any oscillator makes the planning, and execution of strategies around that oscillator far simpler, more timely and effective.
Introducing the Reverse Cutlers RSI which consists of plotted lines on a scale of 0 to 100, and an optional infobox.
The RSI scale is divided into zones:
• Scale high (100)
• Bull critical zone (80 - 100)
• Bull control zone (62 - 80)
• Scale midline (50)
• Bear control zone (20 - 38)
• Bear critical zone (0 - 20)
• Scale low (0)
The RSI plots which graphically display output closing price levels where Cutlers RSI value will crossover:
• RSI (eq) (previous RSI value)
• RSI MA signal line
• RSI Test price
• Alert level high
• Alert level low
The info box displays output closing price levels where Cutlers RSI value will crossover:
• Its previous value. ( RSI )
• Bull critical zone.
• Bull control zone.
• Mid-Line.
• Bear control zone.
• Bear critical zone.
• RSI MA signal line
• Alert level High
• Alert level low
And also displays the resultant RSI for a user defined closing price:
• Test price RSI
The infobox outputs can be shown for the current bar close, or the next bar close.
The user can easily select which information they want in the infobox from the setttings
Importantly:
All info box price levels for the current bar are calculated immediately upon the current bar closing and a new bar opening, they will not change until the current bar closes.
All info box price levels for the next bar are projections which are continually recalculated as the current price changes, and therefore fluctuate as the current price changes.
Understanding the Relative Strength Index
At its simplest the RSI is a measure of how quickly traders are bidding the price of an asset up or down.
It does this by calculating the difference in magnitude of price gains and losses over a specific lookback period to evaluate market conditions.
The RSI is displayed as an oscillator (a line graph that can move between two extremes) and outputs a value limited between 0 and 100.
It is typically accompanied by a moving average signal line.
Traditional interpretations
Overbought and oversold:
An RSI value of 70 or above indicates that an asset is becoming overbought (overvalued condition), and may be may be ready for a trend reversal or corrective pullback in price.
An RSI value of 30 or below indicates that an asset is becoming oversold (undervalued condition), and may be may be primed for a trend reversal or corrective pullback in price.
Midline Crossovers:
When the RSI crosses above its midline ( RSI > 50%) a bullish bias signal is generated. (only take long trades)
When the RSI crosses below its midline ( RSI < 50%) a bearish bias signal is generated. (only take short trades)
Bullish and bearish moving average signal Line crossovers:
When the RSI line crosses above its signal line, a bullish buy signal is generated
When the RSI line crosses below its signal line, a bearish sell signal is generated.
Swing Failures and classic rejection patterns:
If the RSI makes a lower high, and then follows with a downside move below the previous low, a Top Swing Failure has occurred.
If the RSI makes a higher low, and then follows with an upside move above the previous high, a Bottom Swing Failure has occurred.
Examples of classic swing rejection patterns
Bullish swing rejection pattern:
The RSI moves into oversold zone (below 30%).
The RSI rejects back out of the oversold zone (above 30%)
The RSI forms another dip without crossing back into oversold zone.
The RSI then continues the bounce to break up above the previous high.
Bearish swing rejection pattern:
The RSI moves into overbought zone (above 70%).
The RSI rejects back out of the overbought zone (below 70%)
The RSI forms another peak without crossing back into overbought zone.
The RSI then continues to break down below the previous low.
Divergences:
A regular bullish RSI divergence is when the price makes lower lows in a downtrend and the RSI indicator makes higher lows.
A regular bearish RSI divergence is when the price makes higher highs in an uptrend and the RSI indicator makes lower highs.
A hidden bullish RSI divergence is when the price makes higher lows in an uptrend and the RSI indicator makes lower lows.
A hidden bearish RSI divergence is when the price makes lower highs in a downtrend and the RSI indicator makes higher highs.
Regular divergences can signal a reversal of the trending direction.
Hidden divergences can signal a continuation in the direction of the trend.
Chart Patterns:
RSI regularly forms classic chart patterns that may not show on the underlying price chart, such as ascending and descending triangles & wedges , double tops, bottoms and trend lines etc.
Support and Resistance:
It is very often easier to define support or resistance levels on the RSI itself rather than the price chart.
Modern interpretations in trending markets:
Modern interpretations of the RSI stress the context of the greater trend when using RSI signals such as crossovers, overbought/oversold conditions, divergences and patterns.
Constance Brown, CMT , was one of the first who promoted the idea that an oversold reading on the RSI in an uptrend is likely much higher than 30%, and that an overbought reading on the RSI during a downtrend is much lower than the 70% level.
In an uptrend or bull market, the RSI tends to remain in the 40 to 90 range, with the 40-50 zone acting as support.
During a downtrend or bear market, the RSI tends to stay between the 10 to 60 range, with the 50-60 zone acting as resistance.
For ease of executing more modern and nuanced interpretations of RSI it is very useful to break the RSI scale into bull and bear control and critical zones.
These ranges will vary depending on the RSI settings and the strength of the specific market’s underlying trend.
Limitations of the RSI
Like most technical indicators, its signals are most reliable when they conform to the long-term trend.
True trend reversal signals are rare, and can be difficult to separate from false signals.
False signals or “fake-outs”, e.g. a bullish crossover, followed by a sudden decline in price, are common.
Since the indicator displays momentum, it can stay overbought or oversold for a long time when an asset has significant sustained momentum in either direction.
Data Length Dependency when using wilders smoothing method of calculating RSI means that wilders standard RSI will have a potential initialization error which reduces with every new data point calculated meaning early results should be regarded as unreliable until calculation iterations have occurred for convergence.
Alxuse MACD for tutorialAll abilities of MACD, moreover :
Drawing upper band and lower band & the ability to change values, change colors, turn on/off show.
Crossing MACD line and SIGNAL line in multi timeframe & there are symbols (Circles) with green color (Buy) and red color (Sell) & the ability to change colors, turn on/off show.
Crossing MACD line and SIGNAL line in multi timeframe according to the values of upper band and lower band & there are symbols (Triangles) with green color (Long) and red color (Short) & the ability to change colors, turn on/off show.
The ability used in the alert section and create customized alerts.
To receive valid alerts the replay section , the timeframe of the chart must be the same as the timeframe of the indicator.
MACD (Moving Average Convergence/Divergence)
Definition
MACD is an extremely popular indicator used in technical analysis. MACD can be used to identify aspects of a security's overall trend. Most notably these aspects are momentum, as well as trend direction and duration. What makes MACD so informative is that it is actually the combination of two different types of indicators. First, MACD employs two Moving Averages of varying lengths (which are lagging indicators) to identify trend direction and duration. Then, MACD takes the difference in values between those two Moving Averages (MACD Line) and an EMA of those Moving Averages (Signal Line) and plots that difference between the two lines as a histogram which oscillates above and below a center Zero Line. The histogram is used as a good indication of a security's momentum.
MACD Line is a result of taking a longer term EMA and subtracting it from a shorter term EMA.The most commonly used values are 26 days for the longer term EMA and 12 days for the shorter term EMA, but it is the trader's choice.
The Signal Line.
The Signal Line is an EMA of the MACD Line described in Component 1. The trader can choose what period length EMA to use for the Signal Line however 9 is the most common.
The MACD Histogram.
As time advances, the difference between the MACD Line and Signal Line will continually differ. The MACD histogram takes that difference and plots it into an easily readable histogram. The difference between the two lines oscillates around a Zero Line.
A general interpretation of MACD is that when MACD is positive and the histogram value is increasing, then upside momentum is increasing. When MACD is negative and the histogram value is decreasing, then downside momentum is increasing.
What to look for
The MACD indicator is typically good for identifying three types of basic signals; Signal Line Crossovers, Zero Line Crossovers, and Divergence.
SIGNAL LINE CROSSOVERS
A Signal Line Crossover is the most common signal produced by the MACD. First one must consider that the Signal Line is essentially an indicator of an indicator. The Signal Line is calculating the Moving Average of the MACD Line. Therefore the Signal Line lags behind the MACD line. That being said, on the occasions where the MACD Line crosses above or below the Signal Line, that can signify a potentially strong move.
The strength of the move is what determines the duration of Signal Line Crossover. Understanding and being able to analyze move strength, as well as being able to recognize false signals, is a skill that comes with experience.
The first type of Signal Line Crossover to examine is the Bullish Signal Line Crossover. Bullish Signal Line Crossovers occur when the MACD Line crosses above the Signal Line.
The second type of Signal Line Crossover to examine is the Bearish Signal Line Crossover. Bearish Signal Line Crossovers occur when the MACD Line crosses below the Signal Line.
Zero line crossovers
Zero Line Crossovers have a very similar premise to Signal Line Crossovers. Instead of crossing the Signal Line, Zero Line Crossovers occur when the MACD Line crossed the Zero Line and either becomes positive (above 0) or negative (below 0).
The first type of Zero Line Crossover to examine is the Bullish Zero Line Crossover. Bullish Zero Line Crossovers occur when the MACD Line crosses above the Zero Line and go from negative to positive.
The second type of Zero Line Crossover to examine is the Bearish Zero Line Crossover. Bearish Zero Line Crossovers occur when the MACD Line crosses below the Zero Line and go from positive to negative.
Divergence
Divergence is another signal created by the MACD. Simply put, divergence is when the MACD and actual price are not in agreement.
For example, Bullish Divergence occurs when price records a lower low, but the MACD records a higher low. The movement of price can provide evidence of the current trend, however changes in momentum as evidenced by the MACD can sometimes precede a significant reversal.
Bearish Divergence is, of course, the opposite. Bearish Divergence occurs when price records a higher high while the MACD records a lower high.
Summary
What makes the MACD such a valuable tool for technical analysis is that it is almost like two indicators in one. It can help to identify not just trends, but it can measure momentum as well. It takes two separate lagging indicators and adds the aspect of momentum which is much more active or predictive That kind of versatility is why it has been and is used by trader's and analysts across the entire spectrum of finance.
Despite MACD's obvious attributes, just like with any indicator, the trader or analyst needs to exercise caution. There are just some things that MACD doesn't do well which may tempt a trader regardless. Most notably, traders may be tempted into using MACD as a way to find overbought or oversold conditions. This is not a good idea. Remember, MACD is not bound to a range, so what is considered to be highly positive or negative for one instrument may not translate well to a different instrument.
With sufficient time and experience, almost anybody who wants to analyze chart data should be able to make good use out of the MACD.
The added features to the indicator are made for training, it is advisable to use it with caution in tradings.
Cumulative Force Oscillator with MACDCumulative Force Oscillator with MACD
The Cumulative Force Oscillator with MACD is an advanced technical indicator designed to provide traders with a unique perspective on market momentum and trend strength. By combining the power of cumulative candle force analysis with MACD crossover signals, this indicator offers a multifaceted approach to market analysis.
Key Features
1. Cumulative Force Calculation**: Measures the net force of price movements over a specified number of candles.
2. MACD Integration**: Incorporates MACD crossover signals for additional trend confirmation.
3. Visual Cues**: Utilizes color-coded oscillator lines and background zones for easy interpretation.
4. **Dynamic Labeling**: Displays real-time force values and percentage changes.
How It Works
Cumulative Force Calculation
The indicator calculates the "force" of each candle by subtracting the open price from the close price. It then sums this force over a user-defined number of candles to create a cumulative force value. This value oscillates above and below zero, indicating bullish or bearish pressure respectively.
MACD Crossover Detection
The indicator uses the standard MACD (12, 26, 9) to detect bullish and bearish crossovers. These crossovers are visually represented by colored background zones, providing an additional layer of trend confirmation.
Visual Representation
- The main oscillator line is plotted in green when above zero (bullish) and red when below zero (bearish).
- Background colors change based on MACD crossovers: light blue for bullish crossovers and light orange for bearish crossovers.
- A dynamic label displays the current cumulative force value and its percentage change from the previous period.
Interpretation
1. Oscillator Line : When the line is above zero, it indicates net bullish pressure; below zero suggests net bearish pressure.
2. Oscillator Momentum : The steepness and direction of the oscillator line indicate the strength and direction of the current market force.
3. MACD Crossovers : Blue background zones suggest potential bullish trends, while orange zones indicate potential bearish trends.
4. Divergences : Look for divergences between the oscillator and price action for potential trend reversal signals.
Customization
Users can customize several aspects of the indicator :
- Number of candles for force calculation
- Label offset and text size
- Color schemes (through code modification)
Conclusion
The Cumulative Force Oscillator with MACD is a versatile tool that combines momentum analysis with trend confirmation signals. By providing a visual representation of cumulative market force alongside MACD crossovers, it offers traders a comprehensive view of market dynamics. This indicator can be particularly useful for identifying potential trend reversals, confirming existing trends, and gauging overall market strength.
Median Convergence DivergenceIntroduction
The Median Convergence Divergence (MCD) is a derivative of the Moving Average Convergence Divergence (MACD). The difference is the change in the use of the measure of central tendency. In MACD, moving average (mean) is used, whereas, in MCD, the median is used instead. The purpose of using the median is to eliminate the outlying values, which would be calculated for a moving average. The outliers would affect the value of the moving average.
For example: 3, 5, 7, 8, 5, 4, 2, 1, 6, 21, 8. The data set average is 6.3, whereas the median value is 5. There is a difference of about 23% in the example. The reason is the outlying value '21' in the data set.
As the markets are volatile, outlying values can always emerge. A moving average will consider those values; on the other hand, the median will ignore. If the strategy calls for a tool to ignore the outliers, the Median Convergence Divergence would be a great centered oscillator.
The default values have changed to suit the current trading days in a week. When the MACD was introduced, there would be six trading days in a week. Therefore, it used 12 (2 weeks), 26(4 weeks), and 9 ( 1.5 weeks). But now that there are five trading days per week. The default values are adapted to them. Feel free to change them as per your wish.
Recommended Settings
The current settings are set to be used for the Daily Time Frame: 5 day period for the fast line, a 20 day period for the slow line, and a 10 day period for the signal line. (5 days represent a trading week, 10 days is two weeks, and 20 days is 4 weeks or a month)
For the weekly charts, use 4 week period for the fast line, 13 week period for the slow line, and 8 week period for the signal line. (4 weeks represent a month, 8 weeks is two months, and 13 weeks is 3 months or quarterly)
And for monthly charts, use 3 month period for the fast line, 12 month period for the slow line, and 6 month period for the signal line. (3 months is quarterly, 6 months is bi-yearly, and 12 month is yearly)
It'll be challenging to measure for intraday since there are many different timeframes within intraday. The settings mentioned above should also be customized as per the requirements of the trading strategy.
Strategy
The strategy application is the same as the MACD, i.e., Signal Line Crossovers, Zero Line Crossovers, and Divergence.
Signal Line Crossovers: When the MCD line crosses above the Signal line, it's a bullish crossover. When the MCD line crosses below the Signal line, it's a bearish crossover.
Zero Line Crossovers: It's a bullish crossover when the MCD line crosses above the Zero line. When the MCD line crosses below the Zero Line, it's a bearish crossover.
Divergence: When price shows a lower low, but MCD shows a higher low, it's a bullish divergence. When the price shows a higher high but MCD shows a lower high, it's a bearish divergence.
Using other indicators in conjunction with the Median Convergence Divergence is recommended to take entry and exit signals.
EMA-Based Squeeze Dynamics (Gap Momentum & EWMA Projection)EMA-Based Squeeze Dynamics (Gap Momentum & EWMA Projection)
🚨 Main Utility: Early Squeeze Warning
The primary function of this indicator is to warn traders early when the market is approaching a "squeeze"—a tightening condition that often precedes significant moves or regime shifts. By visually highlighting areas of increasing tension, it helps traders anticipate potential volatility and prepare accordingly. This is intended to be a statistically and psychologically grounded replacement of so-called "fib-time-zones," which are overly-deterministic and subjective.
📌 Overview
The EMA-Based Squeeze Dynamics indicator projects future regime shifts (such as golden and death crosses) using exponential moving averages (EMAs). It employs historical interval data and current market conditions to dynamically forecast when the critical EMAs (50-period and 200-period) will reconverge, marking likely trend-change points.
This indicator leverages two core ideas:
Behavioral finance theory: Traders often collectively anticipate popular EMA crossovers, creating a self-fulfilling prophecy (normative social influence), similar to findings from Solomon Asch’s conformity experiments.
Bayesian-like updates: It utilizes historical crossover intervals as a prior, dynamically updating expectations based on evolving market data, ensuring its signals remain objectively grounded in actual market behavior.
⚙️ Technical & Mathematical Explanation
1. EMA Calculations and Regime Definitions
The indicator uses three EMAs:
Fast (9-period): Represents short-term price movement.
Medial (50-period): Indicates medium-term trend direction.
Slow (200-period): Defines long-term market sentiment.
Regime States:
Bullish: 50 EMA is above the 200 EMA.
Bearish: 50 EMA is below the 200 EMA.
A shift between these states triggers visual markers (arrows and labels) directly on the chart.
2. Gap Dynamics and Historical Intervals
At each crossover:
The indicator records the gap (distance) between the 50 and 200 EMAs.
It tracks the historical intervals between past crossovers.
An Exponentially Weighted Moving Average (EWMA) of these intervals is calculated, weighting recent intervals more heavily, dynamically updating expectations.
Important note:
After every regime shift, the projected crossover line resets its calculation. This reset is visually evident as the projection line appears to move further away after each regime change, temporarily "repelled" until the EMAs begin converging again. This ensures projections remain realistic, grounded in actual EMA convergence, and prevents overly optimistic forecasts immediately after a regime shift.
3. Gap Momentum & Adaptive Scaling
The indicator measures how quickly or slowly the gap between EMAs is changing ("gap momentum") and adjusts its forecast accordingly:
If the gap narrows rapidly, a crossover becomes more imminent.
If the gap widens, the next crossover is pushed further into the future.
The "gap factor" dynamically scales the projection based on recent gap momentum, bounded between reasonable limits (0.7–1.3).
4. Squeeze Ratio & Background Color (Visual Cues)
A "squeeze ratio" is computed when market conditions indicate tightening:
In a bullish regime, if the fast EMA is below the medial EMA (price pulling back towards long-term support), the squeeze ratio increases.
In a bearish regime, if the fast EMA rises above the medial EMA (price rallying into long-term resistance), the squeeze ratio increases.
What the Background Colors Mean:
Red Background: Indicates a bullish squeeze—price is compressing downward, hinting a bullish reversal or continuation breakout may occur soon.
Green Background: Indicates a bearish squeeze—price is compressing upward, suggesting a bearish reversal or continuation breakout could soon follow.
Opacity Explanation:
The transparency (opacity) of the background indicates the intensity of the squeeze:
High Opacity (solid color): Strong squeeze, high likelihood of imminent volatility or regime shift.
Low Opacity (faint color): Mild squeeze, signaling early stages of tightening.
Thus, more vivid colors serve as urgent visual warnings that a squeeze is rapidly intensifying.
5. Projected Next Crossover and Pseudo Crossover Mechanism
The indicator calculates an estimated future bar when a crossover (and thus, regime shift) is expected to occur. This calculation incorporates:
Historical EWMA interval.
Current squeeze intensity.
Gap momentum.
A dynamic penalty based on divergence from baseline conditions.
The "Pseudo Crossover" Explained:
A key adaptive feature is the pseudo crossover mechanism. If price action significantly deviates from the projected crossover (for example, if price stays beyond the projected line longer than expected), the indicator acknowledges the projection was incorrect and triggers a "pseudo crossover" event. Essentially, this acts as a reset, updating historical intervals with a weighted adjustment to recalibrate future predictions. In other words, if the indicator’s initial forecast proves inaccurate, it recognizes this quickly, resets itself, and tries again—ensuring it remains responsive and adaptive to actual market conditions.
🧠 Behavioral Theory: Normative Social Influence
This indicator is rooted in behavioral finance theory, specifically leveraging normative social influence (conformity). Traders commonly watch EMA signals (especially the 50 and 200 EMA crossovers). When traders collectively anticipate these signals, they begin trading ahead of actual crossovers, effectively creating self-fulfilling prophecies—similar to Solomon Asch’s famous conformity experiments, where individuals adopted group behaviors even against direct evidence.
This behavior means genuine regime shifts (actual EMA crossovers) rarely occur until EMAs visibly reconverge due to widespread anticipatory trading activity. The indicator quantifies these dynamics by objectively measuring EMA convergence and updating projections accordingly.
📊 How to Use This Indicator
Monitor the background color and opacity as primary visual cues.
A strongly colored background (solid red/green) is an early alert that a squeeze is intensifying—prepare for potential volatility or a regime shift.
Projected crossover lines give a dynamic target bar to watch for trend reversals or confirmations.
After each regime shift, expect a reset of the projection line. The line may seem initially repelled from price action, but it will recalibrate as EMAs converge again.
Trust the pseudo crossover mechanism to automatically recalibrate the indicator if its original projection misses.
🎯 Why Choose This Indicator?
Early Warning: Visual squeeze intensity helps anticipate market breakouts.
Behaviorally Grounded: Leverages real trader psychology (conformity and anticipation).
Objective & Adaptive: Uses real-time, data-driven updates rather than static levels or subjective analysis.
Easy to Interpret: Clear visual signals (arrows, labels, colors) simplify trading decisions.
Self-correcting (Pseudo Crossovers): Quickly adjusts when initial predictions miss, maintaining accuracy over time.
Summary:
The EMA-Based Squeeze Dynamics Indicator combines behavioral insights, dynamic Bayesian-like updates, intuitive visual cues, and a self-correcting pseudo crossover feature to offer traders a reliable early warning system for market squeezes and impending regime shifts. It transparently recalibrates after each regime shift and automatically resets whenever projections prove inaccurate—ensuring you always have an adaptive, realistic forecast.
Whether you're a discretionary trader or algorithmic strategist, this indicator provides a powerful tool to navigate market volatility effectively.
Happy Trading! 📈✨
Reverse Cutlers Relative Strength IndexIntroduction
The Reverse Cutlers Relative Strength Index (RCRSI) is an indicator which tells the user what price is required to give a particular Cutlers Relative Strength Index (RSI) value, or cross its Moving Average (MA) signal line.
Overview
Background & Credits:
The relative strength index (RSI) is a momentum indicator used in technical analysis that was originally developed by J. Welles Wilder Jr. and introduced in his seminal 1978 book, “New Concepts in Technical Trading Systems.”.
Cutler created a variation of the RSI known as “Cutlers RSI” using a different formulation to avoid an inherent accuracy problem which arises when using Wilders method of smoothing.
Further developments in the use, and more nuanced interpretations of the RSI have been developed by Cardwell, and also by well-known chartered market technician, Constance Brown C.M.T., in her acclaimed book "Technical Analysis for the Trading Professional” 1999 where she described the idea of bull and bear market ranges for RSI, and while she did not actually reveal the formulas, she introduced the concept of “reverse engineering” the RSI to give price level outputs.
Renowned financial software developer, co-author of academic books on finance, and scientific fellow to the Department of Finance and Insurance at the Technological Educational Institute of Crete, Giorgos Siligardos PHD. brought a new perspective to Wilder’s RSI when he published his excellent and well-received articles "Reverse Engineering RSI " and "Reverse Engineering RSI II " in the June 2003, and August 2003 issues of Stocks & Commodities magazine, where he described his methods of reverse engineering Wilders RSI.
Several excellent Implementations of the Reverse Wilders Relative Strength Index have been published here on Tradingview and elsewhere.
My utmost respect, and all due credits to authors of related prior works.
Introduction
It is worth noting that while the general RSI formula, and the logic dictating the UpMove and DownMove data series as described above has remained the same as the Wilders original formulation, it has been interpreted in a different way by using a different method of averaging the upward, and downward moves.
Cutler recognized the issue of data length dependency when using wilders smoothing method of calculating RSI which means that wilders standard RSI will have a potential initialization error which reduces with every new data point calculated meaning early results should be regarded as unreliable until enough calculation iterations have occurred for convergence.
Hence Cutler proposed using Simple Moving Averaging for gain and loss data which this Indicator is based on.
Having "Reverse engineered" prices for any oscillator makes the planning, and execution of strategies around that oscillator far simpler, more timely and effective.
Introducing the Reverse Cutlers RSI which consists of plotted lines on a scale of 0 to 100, and an optional infobox.
The RSI scale is divided into zones:
• Scale high (100)
• Bull critical zone (80 - 100)
• Bull control zone (62 - 80)
• Scale midline (50)
• Bear critical zone (20 - 38)
• Bear control zone (0 - 20)
• Scale low (0)
The RSI plots are:
• Cutlers RSI
• RSI MA signal line
• Test price RSI
• Alert level high
• Alert level low
The info box displays output closing price levels where Cutlers RSI value will crossover:
• Its previous value. (RSI )
• Bull critical zone.
• Bull control zone.
• Mid-Line.
• Bear control zone.
• Bear critical zone.
• RSI MA signal line
• Alert level High
• Alert level low
And also displays the resultant RSI for a user defined closing price:
• Test price RSI
The infobox outputs can be shown for the current bar close, or the next bar close.
The user can easily select which information they want in the infobox from the setttings
Importantly:
All info box price levels for the current bar are calculated immediately upon the current bar closing and a new bar opening, they will not change until the current bar closes.
All info box price levels for the next bar are projections which are continually recalculated as the current price changes, and therefore fluctuate as the current price changes.
Understanding the Relative Strength Index
At its simplest the RSI is a measure of how quickly traders are bidding the price of an asset up or down.
It does this by calculating the difference in magnitude of price gains and losses over a specific lookback period to evaluate market conditions.
The RSI is displayed as an oscillator (a line graph that can move between two extremes) and outputs a value limited between 0 and 100.
It is typically accompanied by a moving average signal line.
Traditional interpretations
Overbought and oversold:
An RSI value of 70 or above indicates that an asset is becoming overbought (overvalued condition), and may be may be ready for a trend reversal or corrective pullback in price.
An RSI value of 30 or below indicates that an asset is becoming oversold (undervalued condition), and may be may be primed for a trend reversal or corrective pullback in price.
Midline Crossovers:
When the RSI crosses above its midline (RSI > 50%) a bullish bias signal is generated. (only take long trades)
When the RSI crosses below its midline (RSI < 50%) a bearish bias signal is generated. (only take short trades)
Bullish and bearish moving average signal Line crossovers:
When the RSI line crosses above its signal line, a bullish buy signal is generated
When the RSI line crosses below its signal line, a bearish sell signal is generated.
Swing Failures and classic rejection patterns:
If the RSI makes a lower high, and then follows with a downside move below the previous low, a Top Swing Failure has occurred.
If the RSI makes a higher low, and then follows with an upside move above the previous high, a Bottom Swing Failure has occurred.
Examples of classic swing rejection patterns
Bullish swing rejection pattern:
The RSI moves into oversold zone (below 30%).
The RSI rejects back out of the oversold zone (above 30%)
The RSI forms another dip without crossing back into oversold zone.
The RSI then continues the bounce to break up above the previous high.
Bearish swing rejection pattern:
The RSI moves into overbought zone (above 70%).
The RSI rejects back out of the overbought zone (below 70%)
The RSI forms another peak without crossing back into overbought zone.
The RSI then continues to break down below the previous low.
Divergences:
A regular bullish RSI divergence is when the price makes lower lows in a downtrend and the RSI indicator makes higher lows.
A regular bearish RSI divergence is when the price makes higher highs in an uptrend and the RSI indicator makes lower highs.
A hidden bullish RSI divergence is when the price makes higher lows in an uptrend and the RSI indicator makes lower lows.
A hidden bearish RSI divergence is when the price makes lower highs in a downtrend and the RSI indicator makes higher highs.
Regular divergences can signal a reversal of the trending direction.
Hidden divergences can signal a continuation in the direction of the trend.
Chart Patterns:
RSI regularly forms classic chart patterns that may not show on the underlying price chart, such as ascending and descending triangles & wedges, double tops, bottoms and trend lines etc.
Support and Resistance:
It is very often easier to define support or resistance levels on the RSI itself rather than the price chart.
Modern interpretations in trending markets:
Modern interpretations of the RSI stress the context of the greater trend when using RSI signals such as crossovers, overbought/oversold conditions, divergences and patterns.
Constance Brown, CMT, was one of the first who promoted the idea that an oversold reading on the RSI in an uptrend is likely much higher than 30%, and that an overbought reading on the RSI during a downtrend is much lower than the 70% level.
In an uptrend or bull market, the RSI tends to remain in the 40 to 90 range, with the 40-50 zone acting as support.
During a downtrend or bear market, the RSI tends to stay between the 10 to 60 range, with the 50-60 zone acting as resistance.
For ease of executing more modern and nuanced interpretations of RSI it is very useful to break the RSI scale into bull and bear control and critical zones.
These ranges will vary depending on the RSI settings and the strength of the specific market’s underlying trend.
Limitations of the RSI
Like most technical indicators, its signals are most reliable when they conform to the long-term trend.
True trend reversal signals are rare, and can be difficult to separate from false signals.
False signals or “fake-outs”, e.g. a bullish crossover, followed by a sudden decline in price, are common.
Since the indicator displays momentum, it can stay overbought or oversold for a long time when an asset has significant sustained momentum in either direction.
Data Length Dependency when using wilders smoothing method of calculating RSI means that wilders standard RSI will have a potential initialization error which reduces with every new data point calculated meaning early results should be regarded as unreliable until calculation iterations have occurred for convergence.
CT Reverse True Strength IndicatorIntroducing the Caretakers Reverse True Strength Index.
According to Wikipedia….
“The True Strength Index (TSI) is a technical indicator used in the analysis of financial markets that attempts to show both trend direction and overbought/oversold conditions. It was first published William Blau in 1991.
The indicator uses moving averages of the underlying momentum of a financial instrument.
Momentum is considered a leading indicator of price movements, and a moving average characteristically lags behind price.
The TSI combines these characteristics to create an indication of price and direction more in sync with market turns than either momentum or moving average.”
The TSI has a normal range of values between +100 and -100.
Traditionally traders and analysts will consider:
Positives values above 25 to indicate an “overbought” condition
Negative values below -25 to indicate an “oversold” condition
I have reverse engineered the True Strength Index formula to derive 2 new functions.
The reverse TSI function is dual purpose which can be used to calculate….
The chart price at which the TSI will reach a particular TSI scale value.
The chart price at which the TSI will equal its previous value.
The reverse TSI signal cross function can be used to calculate the chart price at which the TSI will cross its signal line.
I have employed these functions here to return the price levels where the True Strength Index would equal :
Upper alert level ( default 25 )
Zero-Line
Lower alert level ( default -25 )
Previous TSI (eq) value.
TSI signal line
These crossover levels are displayed via an optional info-box with choice of user selected info.
How to interpret the displayed prices returned from the TSI scale zero line and upper and lower alert levels.
Closing exactly at the given price will cause the True Strength Index value to equal the scale value.
Closing above the given price will cause the True Strength Index to cross above the scale value.
Closing below the given price will cause the True Strength Index to cross below the scale value.
How to interpret the displayed price returned from the TSI (eq)
Closing exactly at the price will cause the True Strength Index value to equal the previous TSI value.
Closing above the price will cause the True Strength Index value to increase.
Closing below the price will cause the True Strength Index value to decrease.
How to interpret the displayed price returned from the TSI signal line crossover.
Closing exactly at the given price will cause the True Strength Index value to equal the signal line.
Closing above the given price will cause the True Strength Index to cross above the signal line.
Closing below the given price will cause the True Strength Index to cross below the signal line.
Common methods to derive signals from the TSI :
Zero-line crossovers
When the CMO crosses above the zero-line, a buy signal is generated.
When the CMO crosses below the zero-line, a sell signal is generated.
“Overbought” and “Oversold” crossover
When the SMI crosses below -25 and then moves back above it, a buy signal is generated.
When the SMI crosses above +25 and then moves back below it, a sell signal is generated.
What Does the True Strength Index (TSI) Tell You?
The indicator is primarily used to identify overbought and oversold conditions in an asset's price, spot divergence, identify trend direction and changes via the zero-line, and highlight short-term price momentum with signal line crossovers.
Since the TSI is based on price movements, oversold and overbought levels will vary by the asset being traded. Some stocks may reach +30 and -30 before tending to see price reversals, while another stock may reverse near +20 and -20.
Mark extreme TSI levels, on the asset being traded, to see where overbought and oversold is. Being oversold doesn't necessarily mean it is time to buy, and when an asset is overbought it doesn't necessarily mean it is time to sell. Traders will typically watch for other signals to trigger a trade decision. For example, they may wait for the price or TSI to start dropping before selling in overbought territory. Alternatively, they may wait for a signal line crossover.
Signal Line Crossovers
The true strength index has a signal line, which is usually a seven- to 13-period EMA of the TSI line. A signal line crossover occurs when the TSI line crosses the signal line. When the TSI crosses above the signal line from below, that may warrant a long position. When the TSI crosses below the signal line from above, that may warrant selling or short selling.
Signal line crossovers occur frequently, so should be utilized only in conjunction with other signals from the TSI. For example, buy signals may be favoured when the TSI is above the zero-line. Or sell signals may be favoured when the TSI is in overbought territory.
Zero-line Crossovers
The zero-line crossover is another signal the TSI generates. Price momentum is positive when the indicator is above zero and negative when it is below zero. Some traders use the zero-line for a directional bias. For example, a trader may decide only to enter a long position if the indicator is above its zero-line. Conversely, the trader would be bearish and only consider short positions if the indicator's value is below zero.
Breakouts and Divergence
Traders can use support and resistance levels created by the true strength index to identify breakouts and price momentum shifts. For instance, if the indicator breaks below a trendline, the price may see continued selling.
Divergence is another tool the TSI provides. If the price of an asset is moving higher, while the TSI is dropping, that is called bearish divergence and could result in a downside price move. If the TSI is rising while the price is falling, that could signal higher prices to come. This is called bullish divergence.
Divergence is a poor timing signal, so it should only be used in conjunction with other signals generated by the TSI or other technical indicators.
The Difference Between the True Strength Index (TSI) and the Moving Average Convergence Divergence (MACD) Indicator.
The TSI is smoothing price changes to create a technical oscillator. The moving average convergence divergence (MACD) indicator is measuring the separation between two moving averages. Both indicators are used in similar ways for trading purposes, yet they are not calculated the same and will provide different signals at different times.
The Limitations of Using the True Strength Index (TSI)
Many of the signals provided by the TSI will be false signals. That means the price action will be different than expected following a trade signal. For example, during an uptrend, the TSI may cross below the zero-line several times, but then the price proceeds higher even though the TSI indicates momentum has shifted down.
Signal line crossovers also occur so frequently that they may not provide a lot of trading benefit. Such signals need to be heavily filtered based on other elements of the indicator or through other forms of analysis. The TSI will also sometimes change direction without price changing direction, resulting in trade signals that look good on the TSI but continue to lose money based on price.
Divergence also tends to unreliable on the indicator. Divergence can last so long that it provides little insight into when a reversal will actually occur. Also, divergence isn't always present when price reversals actually do occur.
The TSI should only be used in conjunction with other forms of analysis, such as price action analysis and other technical indicators.
This is not financial advice, use at your own risk.
CT Reverse True Strength Indicator On ChartIntroducing the Caretakers “On Chart” Reverse True Strength Index.
According to Wikipedia….
“The True Strength Index (TSI) is a technical indicator used in the analysis of financial markets that attempts to show both trend direction and overbought/oversold conditions. It was first published William Blau in 1991.
The indicator uses moving averages of the underlying momentum of a financial instrument.
Momentum is considered a leading indicator of price movements, and a moving average characteristically lags behind price.
The TSI combines these characteristics to create an indication of price and direction more in sync with market turns than either momentum or moving average.”
The TSI has a normal range of values between +100 and -100.
Traditionally traders and analysts will consider:
Positives values above 25 to indicate an “overbought” condition
Negative values below -25 to indicate an “oversold” condition
I have reverse engineered the True Strength Index formula to derive 2 new functions.
1) The reverse TSI function is dual purpose which can be used to calculate….
The chart price at which the TSI will reach a particular TSI scale value.
The chart price at which the TSI will equal its previous value.
2) The reverse TSI signal cross function can be used to calculate the chart price at which the TSI will cross its signal line.
I have employed these functions here to return the price levels where the True Strength Index would equal :
Upper alert level ( default 25 )
Zero-Line
Lower alert level ( default -25 )
Previous TSI (eq) value
TSI signal line
In this “On Chart” version of the reverse True Strength Index the crossover levels are displayed both as lines on the chart and via an optional info-box with choice of user selected info.
Chart Line Colors
Upper alert level... ( Fuchsia )
Zero-Line............ ( White )
Lower alert level... ( Aqua )
TSI (eq)...............( TSI (eq) > close..Orange, TSI (eq) < close..Lime )
TSI signal line........( Signal Cross Line > Close..Aqua, Signal Cross Line < Close..Fuchsia )
How to interpret the displayed prices returned from the TSI scale zero line and upper and lower alert levels.
Closing exactly at the given price will cause the True Strength Index value to equal the scale value.
Closing above the given price will cause the True Strength Index to cross above the scale value.
Closing below the given price will cause the True Strength Index to cross below the scale value.
How to interpret the displayed price returned from the TSI (eq)
Closing exactly at the price will cause the True Strength Index value to equal the previous TSI value.
Closing above the price will cause the True Strength Index value to increase.
Closing below the price will cause the True Strength Index value to decrease.
How to interpret the displayed price returned from the TSI signal line crossover.
Closing exactly at the given price will cause the True Strength Index value to equal the signal line.
Closing above the given price will cause the True Strength Index to cross above the signal line.
Closing below the given price will cause the True Strength Index to cross below the signal line.
Common methods to derive signals from the TSI :
Zero-line crossovers
When the CMO crosses above the zero-line, a buy signal is generated.
When the CMO crosses below the zero-line, a sell signal is generated.
“Overbought” and “Oversold” crossovers
When the SMI crosses below -25 and then moves back above it, a buy signal is generated.
When the SMI crosses above +25 and then moves back below it, a sell signal is generated.
What Does the True Strength Index (TSI) Tell You?
The indicator is primarily used to identify overbought and oversold conditions in an asset's price, spot divergence, identify trend direction and changes via the zero-line, and highlight short-term price momentum with signal line crossovers.
Since the TSI is based on price movements, oversold and overbought levels will vary by the asset being traded. Some stocks may reach +30 and -30 before tending to see price reversals, while another stock may reverse near +20 and -20.
Mark extreme TSI levels, on the asset being traded, to see where overbought and oversold is. Being oversold doesn't necessarily mean it is time to buy, and when an asset is overbought it doesn't necessarily mean it is time to sell. Traders will typically watch for other signals to trigger a trade decision. For example, they may wait for the price or TSI to start dropping before selling in overbought territory. Alternatively, they may wait for a signal line crossover.
Signal Line Crossovers
The true strength index has a signal line, which is usually a seven- to 13-period EMA of the TSI line. A signal line crossover occurs when the TSI line crosses the signal line. When the TSI crosses above the signal line from below, that may warrant a long position. When the TSI crosses below the signal line from above, that may warrant selling or short selling.
Signal line crossovers occur frequently, so should be utilized only in conjunction with other signals from the TSI. For example, buy signals may be favoured when the TSI is above the zero-line. Or sell signals may be favoured when the TSI is in overbought territory.
Zero-line Crossovers
The zero-line crossover is another signal the TSI generates. Price momentum is positive when the indicator is above zero and negative when it is below zero. Some traders use the zero-line for a directional bias. For example, a trader may decide only to enter a long position if the indicator is above its zero-line. Conversely, the trader would be bearish and only consider short positions if the indicator's value is below zero.
Breakouts and Divergence
Traders can use support and resistance levels created by the true strength index to identify breakouts and price momentum shifts. For instance, if the indicator breaks below a trendline, the price may see continued selling.
Divergence is another tool the TSI provides. If the price of an asset is moving higher, while the TSI is dropping, that is called bearish divergence and could result in a downside price move. If the TSI is rising while the price is falling, that could signal higher prices to come. This is called bullish divergence.
Divergence is a poor timing signal, so it should only be used in conjunction with other signals generated by the TSI or other technical indicators.
The Difference Between the True Strength Index (TSI) and the Moving Average Convergence Divergence (MACD) Indicator.
The TSI is smoothing price changes to create a technical oscillator. The moving average convergence divergence (MACD) indicator is measuring the separation between two moving averages. Both indicators are used in similar ways for trading purposes, yet they are not calculated the same and will provide different signals at different times.
The Limitations of Using the True Strength Index (TSI)
Many of the signals provided by the TSI will be false signals. That means the price action will be different than expected following a trade signal. For example, during an uptrend, the TSI may cross below the zero-line several times, but then the price proceeds higher even though the TSI indicates momentum has shifted down.
Signal line crossovers also occur so frequently that they may not provide a lot of trading benefit. Such signals need to be heavily filtered based on other elements of the indicator or through other forms of analysis. The TSI will also sometimes change direction without price changing direction, resulting in trade signals that look good on the TSI but continue to lose money based on price.
Divergence also tends to unreliable on the indicator. Divergence can last so long that it provides little insight into when a reversal will actually occur. Also, divergence isn't always present when price reversals actually do occur.
The TSI should only be used in conjunction with other forms of analysis, such as price action analysis and other technical indicators.
This is not financial advice, use at your own risk.
FIRST-HOUR TOOL V.1.8.08.23Three horizontal lines are drawn on the chart to represent session prices. These prices are calculated based on the user-specified session:
"FirstHour Session High" represents the highest price reached during the firsthour session.
"FirstHour Session Open" represents the opening price of the firsthour session
"FirstHour Session Low" represents the lowest price reached during the firsthour session.
These prices are respectively colored with light blue, light yellow, and light pink.
The chart background can change color based on whether the current time is within the specified session. If the current time is within the session, the background will be colored in semi-transparent aqua green. Otherwise, it will remain transparent.
Upward-pointing triangle markers are used to highlight points where the closing price crosses above (crossover) or below (crossunder) the session levels.
These markers appear below the corresponding bar.
They are colored based on the type of crossover:
Yellow for crossover above the "FirstHour High"
Red for crossover above the "FirstHour Open"
Green for crossover above the "FirstHour Low"
Alerts:
Alert messages are generated when crossovers or crossunders of the closing price relative to the session levels occur.
The alerts appear once per bar. Alerts are generated for the following events:
Crossover of the price above the "Session High" with the message "High First Hour Crossover."
Crossunder of the price below the "Session Open" with the message "Open First Hour Crossunder."
Crossunder of the price below the "Session Low" with the message "Low First Hour Crossunder."
Crossover of the price above the "Session Low" with the message "Low First Hour Crossover."
In summary, this indicator provides a visual representation of session prices and events, helping traders spot significant crossovers and crossunders relative to key price levels.
Author @tumiza999
Coins Trend Tracker HTThe Coins Trend Tracker HT script provides a powerful tool for monitoring and comparing the trend signals of multiple cryptocurrencies based on their Exponential Moving Averages (EMAs). This script is particularly useful for traders who want to keep track of multiple coins across different timeframes and identify potential trading opportunities based on EMA crossovers.
Features:
Customizable Coin Selection: Users can select up to four different cryptocurrencies to monitor.
Flexible Timeframes: Users can choose two different timeframes for EMA calculations to suit their trading strategies.
Visual Trend Indicators: The script displays trend indicators (🚀 for bullish and 💀 for bearish) based on the EMA crossover status for each coin and timeframe.
Conditional Cell Coloring: Table cells are color-coded based on the EMA crossover conditions, helping users quickly identify bullish or bearish trends.
Opacity Control: Users can adjust the opacity of the table cell colors for better visualization on the chart.
How It Works:
Coin Selection: Users can select up to four different cryptocurrencies to monitor by entering their ticker symbols.
Timeframe Selection: Users can select two different timeframes for the EMA calculations. The script calculates the 5-period and 20-period EMAs for each coin and timeframe.
EMA Crossovers: The script checks for EMA crossovers (EMA 5 crossing above or below EMA 20) and updates the trend indicators and cell colors accordingly.
Table Display: The script displays a table with the selected coins, their current prices, and trend indicators for the chosen timeframes. The background color of the table cells changes based on the EMA crossover status.
Script Logic:
The get_price function retrieves the latest price of the selected coin for the specified timeframe.
The get_ema_cross function calculates the 5-period and 20-period EMAs and checks for crossover conditions.
The fill_row function populates the table with the coin data, trend indicators, and conditionally colored cells.
The table header and data rows are updated based on the user-selected coins, timeframes, and EMA crossover conditions.
Usage:
Add the script to your TradingView chart.
Customize the coin selection, timeframes, text color, default cell color, bullish and bearish cross colors, and cell opacity through the input settings.
The script will display a table with the selected coins, their current prices, and trend indicators based on the EMA crossovers for the chosen timeframes.
Multi-Factor StrategyThis trading strategy combines multiple technical indicators to create a systematic approach for entering and exiting trades. The goal is to capture trends by aligning several key indicators to confirm the direction and strength of a potential trade. Below is a detailed description of how the strategy works:
Indicators Used
MACD (Moving Average Convergence Divergence):
MACD Line: The difference between the 12-period and 26-period Exponential Moving Averages (EMAs).
Signal Line: A 9-period EMA of the MACD line.
Usage: The strategy looks for crossovers between the MACD line and the Signal line as entry signals. A bullish crossover (MACD line crossing above the Signal line) indicates a potential upward movement, while a bearish crossover (MACD line crossing below the Signal line) signals a potential downward movement.
RSI (Relative Strength Index):
Usage: RSI is used to gauge the momentum of the price movement. The strategy uses specific thresholds: below 70 for long positions to avoid overbought conditions and above 30 for short positions to avoid oversold conditions.
ATR (Average True Range):
Usage: ATR measures market volatility and is used to set dynamic stop-loss and take-profit levels. A stop loss is set at 2 times the ATR, and a take profit at 3 times the ATR, ensuring that risk is managed relative to market conditions.
Simple Moving Averages (SMA):
50-day SMA: A short-term trend indicator.
200-day SMA: A long-term trend indicator.
Usage: The strategy uses the relationship between the 50-day and 200-day SMAs to determine the overall market trend. Long positions are taken when the price is above the 50-day SMA and the 50-day SMA is above the 200-day SMA, indicating an uptrend. Conversely, short positions are taken when the price is below the 50-day SMA and the 50-day SMA is below the 200-day SMA, indicating a downtrend.
Entry Conditions
Long Position:
-MACD Crossover: The MACD line crosses above the Signal line.
-RSI Confirmation: RSI is below 70, ensuring the asset is not overbought.
-SMA Confirmation: The price is above the 50-day SMA, and the 50-day SMA is above the 200-day SMA, indicating a strong uptrend.
Short Position:
MACD Crossunder: The MACD line crosses below the Signal line.
RSI Confirmation: RSI is above 30, ensuring the asset is not oversold.
SMA Confirmation: The price is below the 50-day SMA, and the 50-day SMA is below the 200-day SMA, indicating a strong downtrend.
Opposite conditions for shorts
Exit Strategy
Stop Loss: Set at 2 times the ATR from the entry price. This dynamically adjusts to market volatility, allowing for wider stops in volatile markets and tighter stops in calmer markets.
Take Profit: Set at 3 times the ATR from the entry price. This ensures a favorable risk-reward ratio of 1:1.5, aiming for higher rewards on successful trades.
Visualization
SMAs: The 50-day and 200-day SMAs are plotted on the chart to visualize the trend direction.
MACD Crossovers: Bullish and bearish MACD crossovers are highlighted on the chart to identify potential entry points.
Summary
This strategy is designed to align multiple indicators to increase the probability of successful trades by confirming trends and momentum before entering a position. It systematically manages risk with ATR-based stop loss and take profit levels, ensuring that trades are exited based on market conditions rather than arbitrary points. The combination of trend indicators (SMAs) with momentum and volatility indicators (MACD, RSI, ATR) creates a robust approach to trading in various market environments.
faiz MACDMACD: Moving Average Convergence Divergence
The Moving Average Convergence Divergence (MACD) is a popular momentum indicator used in technical analysis to gauge the strength, direction, and potential reversal points of a trend in a financial asset's price movement. Developed by Gerald Appel in the late 1970s, MACD is particularly favored by traders for its ability to capture both trend-following and momentum aspects of price behavior.
Components of the MACD
The MACD is derived from two exponential moving averages (EMAs) of a security's price:
MACD Line: This is the difference between the 12-day and 26-day EMAs. The shorter 12-day EMA reacts more quickly to price changes, while the 26-day EMA smooths out price fluctuations, offering a longer-term perspective.
Formula: MACD Line = 12-day EMA - 26-day EMA
Signal Line: This is the 1-day EMA of the MACD Line itself. The signal line is used to generate buy and sell signals when it crosses the MACD line.
Formula: Signal Line = 1-day EMA of the MACD Line
MACD Histogram: The histogram represents the difference between the MACD Line and the Signal Line. It is displayed as bars that oscillate above and below a zero line, helping to visualize the convergence or divergence between the two lines.
Formula: Histogram = MACD Line - Signal Line
Interpretation of MACD
The MACD indicator is used to identify potential buy and sell signals based on the following observations:
MACD Line and Signal Line Crossovers:
Bullish Crossover: A buy signal occurs when the MACD Line crosses above the Signal Line. This suggests that the momentum is shifting in favor of the bulls, indicating a potential upward price movement.
Bearish Crossover: A sell signal occurs when the MACD Line crosses below the Signal Line. This suggests a bearish trend may be emerging, signaling a potential downward movement.
Divergence:
Bullish Divergence: Occurs when the price of the asset is making new lows, but the MACD is forming higher lows. This suggests that the downward momentum is weakening and a potential reversal to the upside may be imminent.
Bearish Divergence: Occurs when the price is making new highs, but the MACD is forming lower highs. This suggests that the upward momentum is weakening and a reversal to the downside may occur.
Only use it in timeframe m1, and solely use for XAUUSD pair.
Advisable to use it as a confirmation with other indicator such as
BBMA, SMC, SUPPORT RESISTANCE, SUPPLY AND DEMAND.
how to use :
MA 5 Crossing above MA9, will generate BUY signals
MA 5 Crossing below MA9, will generate SELL signals
Trade at your own SKILLS.
I dont mind people using this script for free.
All I want is just prayer for me and my family success.
Thank You and Have a nice and pleasant day :-)
2 MA Cross Cvg Dvg Slope Overview
This indicator combines the Moving Average Convergence Divergence (MACD) and two Moving Averages (MAs) to assess market momentum and trend direction. It aims to provide insights into the strength and direction of price movements by analyzing the MACD line, MAs slopes, and MA crossovers. Instead of eyeballing the exact MA crossovers and MAs slope steepness on the chart and MACD line changes on separate panes, this indicator pixelate the overloaded information or multiple indicators interpretation into a KISS "boolean" decision making.
Key Components
MACD Line
This line represents the difference between the fast MA and slow MA. It reflects short-term price momentum relative to the long-term trend.
Moving Averages (MAs)
Two types of MAs are utilized in this indicator:
Fast MA (short-term): Often a 9-period MA or similar, which reacts quickly to price changes.
Slow MA (long-term): Typically a 21-period MA or similar, which smooths out price fluctuations and identifies the longer-term trend.
Indicator Logic
MA Crossover: The crossover of the fast MA above the slow MA suggests a bullish trend, while a crossover below indicates a bearish trend.
MA Slope Analysis: The indicator also considers the slopes of both the fast and slow MAs to determine the direction:
Both MA Positive Slope: Indicates upward momentum or bullish trend.
Both MA Negative Slope: Indicates downward momentum or bearish trend.
One MA Positive Slope, the other Negative Slope: Indicates indecision.
MACD Line: MACD Line consecutively increase means increasing positive momentum, vice versa.
Interpretation
Uptrend: When fast MA cross over slow MA. Indicator show "+" symbol at top zone with value 0.5.
Additional Uptrend Confirmation: When both MAs have positive slope. Indicator show only green bar.
Uptrend Upward Momentum: MACD Line increase when fast MA above slow MA. Indicator show "." symbol value 0.75.
Uptrend Downward Momentum: MACD Line decrease when fast MA above slow MA. Indicator show "." symbol value 0.25.
Indecision: When one of the MA has positive slope, but another MA has negative slope. Indicator showing both red and green bar.
Downtrend: When fast MA cross under slow MA. Indicator show "+" symbol at bottom zone with value 0.5.
Additional Downtrend Confirmation: When both MAs have negative slope. Indicator show only red bar.
Downtrend Upward Momentum: MACD Line increase when fast MA below slow MA. Indicator show "." symbol value -0.25.
Uptrend Downward Momentum: MACD Line decrease when fast MA below slow MA. Indicator show "." symbol value -0.75.
Combination of above multiple interpretation can further derive different signal for Trend Starts, Trend Continuous, and Trend Reversals.
Usage
This indicator is valuable for traders seeking to:
Identify entry and exit points based on single or multiple combination of MAs and MACD Line signals.
Confirm trend direction using MAs cross over or cross under spotted easily with the "+" symbol above 0 or below 0.
Double confirm the trend based on two MAs align slope direction.
Understand momentum shifts and potential trend reversals with an easy 4 different dots at -0.75, -0.25, 0.25, and 0.75.
Conclusion
By combining MACD Line analysis with Moving Average slopes and crossovers, this indicator offers a comprehensive approach to assessing market momentum and trend direction. It provides clear signals for traders to make informed decisions on when to enter or exit positions, enhancing overall trading strategy effectiveness without the need of referring to multiple chart or zoom in and out of the price chart to identify the crossover and slope direction.
RSI Full Forecast [Titans_Invest]RSI Full Forecast
Get ready to experience the ultimate evolution of RSI-based indicators – the RSI Full Forecast, a boosted and even smarter version of the already powerful: RSI Forecast
Now featuring over 40 additional entry conditions (forecasts), this indicator redefines the way you view the market.
AI-Powered RSI Forecasting:
Using advanced linear regression with the least squares method – a solid foundation for machine learning - the RSI Full Forecast enables you to predict future RSI behavior with impressive accuracy.
But that’s not all: this new version also lets you monitor future crossovers between the RSI and the MA RSI, delivering early and strategic signals that go far beyond traditional analysis.
You’ll be able to monitor future crossovers up to 20 bars ahead, giving you an even broader and more precise view of market movements.
See the Future, Now:
• Track upcoming RSI & RSI MA crossovers in advance.
• Identify potential reversal zones before price reacts.
• Uncover statistical behavior patterns that would normally go unnoticed.
40+ Intelligent Conditions:
The new layer of conditions is designed to detect multiple high-probability scenarios based on historical patterns and predictive modeling. Each additional forecast is a window into the price's future, powered by robust mathematics and advanced algorithmic logic.
Full Customization:
All parameters can be tailored to fit your strategy – from smoothing periods to prediction sensitivity. You have complete control to turn raw data into smart decisions.
Innovative, Accurate, Unique:
This isn’t just an upgrade. It’s a quantum leap in technical analysis.
RSI Full Forecast is the first of its kind: an indicator that blends statistical analysis, machine learning, and visual design to create a true real-time predictive system.
⯁ SCIENTIFIC BASIS LINEAR REGRESSION
Linear Regression is a fundamental method of statistics and machine learning, used to model the relationship between a dependent variable y and one or more independent variables 𝑥.
The general formula for a simple linear regression is given by:
y = β₀ + β₁x + ε
β₁ = Σ((xᵢ - x̄)(yᵢ - ȳ)) / Σ((xᵢ - x̄)²)
β₀ = ȳ - β₁x̄
Where:
y = is the predicted variable (e.g. future value of RSI)
x = is the explanatory variable (e.g. time or bar index)
β0 = is the intercept (value of 𝑦 when 𝑥 = 0)
𝛽1 = is the slope of the line (rate of change)
ε = is the random error term
The goal is to estimate the coefficients 𝛽0 and 𝛽1 so as to minimize the sum of the squared errors — the so-called Random Error Method Least Squares.
⯁ LEAST SQUARES ESTIMATION
To minimize the error between predicted and observed values, we use the following formulas:
β₁ = /
β₀ = ȳ - β₁x̄
Where:
∑ = sum
x̄ = mean of x
ȳ = mean of y
x_i, y_i = individual values of the variables.
Where:
x_i and y_i are the means of the independent and dependent variables, respectively.
i ranges from 1 to n, the number of observations.
These equations guarantee the best linear unbiased estimator, according to the Gauss-Markov theorem, assuming homoscedasticity and linearity.
⯁ LINEAR REGRESSION IN MACHINE LEARNING
Linear regression is one of the cornerstones of supervised learning. Its simplicity and ability to generate accurate quantitative predictions make it essential in AI systems, predictive algorithms, time series analysis, and automated trading strategies.
By applying this model to the RSI, you are literally putting artificial intelligence at the heart of a classic indicator, bringing a new dimension to technical analysis.
⯁ VISUAL INTERPRETATION
Imagine an RSI time series like this:
Time →
RSI →
The regression line will smooth these values and extend them n periods into the future, creating a predicted trajectory based on the historical moment. This line becomes the predicted RSI, which can be crossed with the actual RSI to generate more intelligent signals.
⯁ SUMMARY OF SCIENTIFIC CONCEPTS USED
Linear Regression Models the relationship between variables using a straight line.
Least Squares Minimizes the sum of squared errors between prediction and reality.
Time Series Forecasting Estimates future values based on historical data.
Supervised Learning Trains models to predict outputs from known inputs.
Statistical Smoothing Reduces noise and reveals underlying trends.
⯁ WHY THIS INDICATOR IS REVOLUTIONARY
Scientifically-based: Based on statistical theory and mathematical inference.
Unprecedented: First public RSI with least squares predictive modeling.
Intelligent: Built with machine learning logic.
Practical: Generates forward-thinking signals.
Customizable: Flexible for any trading strategy.
⯁ CONCLUSION
By combining RSI with linear regression, this indicator allows a trader to predict market momentum, not just follow it.
RSI Full Forecast is not just an indicator — it is a scientific breakthrough in technical analysis technology.
⯁ Example of simple linear regression, which has one independent variable:
⯁ In linear regression, observations ( red ) are considered to be the result of random deviations ( green ) from an underlying relationship ( blue ) between a dependent variable ( y ) and an independent variable ( x ).
⯁ Visualizing heteroscedasticity in a scatterplot against 100 random fitted values using Matlab:
⯁ The data sets in the Anscombe's quartet are designed to have approximately the same linear regression line (as well as nearly identical means, standard deviations, and correlations) but are graphically very different. This illustrates the pitfalls of relying solely on a fitted model to understand the relationship between variables.
⯁ The result of fitting a set of data points with a quadratic function:
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🔮 Linear Regression: PineScript Technical Parameters 🔮
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Forecast Types:
• Flat: Assumes prices will remain the same.
• Linreg: Makes a 'Linear Regression' forecast for n periods.
Technical Information:
ta.linreg (built-in function)
Linear regression curve. A line that best fits the specified prices over a user-defined time period. It is calculated using the least squares method. The result of this function is calculated using the formula: linreg = intercept + slope * (length - 1 - offset), where intercept and slope are the values calculated using the least squares method on the source series.
Syntax:
• Function: ta.linreg()
Parameters:
• source: Source price series.
• length: Number of bars (period).
• offset: Offset.
• return: Linear regression curve.
This function has been cleverly applied to the RSI, making it capable of projecting future values based on past statistical trends.
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⯁ WHAT IS THE RSI❓
The Relative Strength Index (RSI) is a technical analysis indicator developed by J. Welles Wilder. It measures the magnitude of recent price movements to evaluate overbought or oversold conditions in a market. The RSI is an oscillator that ranges from 0 to 100 and is commonly used to identify potential reversal points, as well as the strength of a trend.
⯁ HOW TO USE THE RSI❓
The RSI is calculated based on average gains and losses over a specified period (usually 14 periods). It is plotted on a scale from 0 to 100 and includes three main zones:
• Overbought: When the RSI is above 70, indicating that the asset may be overbought.
• Oversold: When the RSI is below 30, indicating that the asset may be oversold.
• Neutral Zone: Between 30 and 70, where there is no clear signal of overbought or oversold conditions.
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⯁ ENTRY CONDITIONS
The conditions below are fully flexible and allow for complete customization of the signal.
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🔹 CONDITIONS TO BUY 📈
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• Signal Validity: The signal will remain valid for X bars .
• Signal Sequence: Configurable as AND or OR .
📈 RSI Conditions:
🔹 RSI > Upper
🔹 RSI < Upper
🔹 RSI > Lower
🔹 RSI < Lower
🔹 RSI > Middle
🔹 RSI < Middle
🔹 RSI > MA
🔹 RSI < MA
📈 MA Conditions:
🔹 MA > Upper
🔹 MA < Upper
🔹 MA > Lower
🔹 MA < Lower
📈 Crossovers:
🔹 RSI (Crossover) Upper
🔹 RSI (Crossunder) Upper
🔹 RSI (Crossover) Lower
🔹 RSI (Crossunder) Lower
🔹 RSI (Crossover) Middle
🔹 RSI (Crossunder) Middle
🔹 RSI (Crossover) MA
🔹 RSI (Crossunder) MA
🔹 MA (Crossover) Upper
🔹 MA (Crossunder) Upper
🔹 MA (Crossover) Lower
🔹 MA (Crossunder) Lower
📈 RSI Divergences:
🔹 RSI Divergence Bull
🔹 RSI Divergence Bear
📈 RSI Forecast:
🔹 RSI (Crossover) MA Forecast
🔹 RSI (Crossunder) MA Forecast
🔹 RSI Forecast 1 > MA Forecast 1
🔹 RSI Forecast 1 < MA Forecast 1
🔹 RSI Forecast 2 > MA Forecast 2
🔹 RSI Forecast 2 < MA Forecast 2
🔹 RSI Forecast 3 > MA Forecast 3
🔹 RSI Forecast 3 < MA Forecast 3
🔹 RSI Forecast 4 > MA Forecast 4
🔹 RSI Forecast 4 < MA Forecast 4
🔹 RSI Forecast 5 > MA Forecast 5
🔹 RSI Forecast 5 < MA Forecast 5
🔹 RSI Forecast 6 > MA Forecast 6
🔹 RSI Forecast 6 < MA Forecast 6
🔹 RSI Forecast 7 > MA Forecast 7
🔹 RSI Forecast 7 < MA Forecast 7
🔹 RSI Forecast 8 > MA Forecast 8
🔹 RSI Forecast 8 < MA Forecast 8
🔹 RSI Forecast 9 > MA Forecast 9
🔹 RSI Forecast 9 < MA Forecast 9
🔹 RSI Forecast 10 > MA Forecast 10
🔹 RSI Forecast 10 < MA Forecast 10
🔹 RSI Forecast 11 > MA Forecast 11
🔹 RSI Forecast 11 < MA Forecast 11
🔹 RSI Forecast 12 > MA Forecast 12
🔹 RSI Forecast 12 < MA Forecast 12
🔹 RSI Forecast 13 > MA Forecast 13
🔹 RSI Forecast 13 < MA Forecast 13
🔹 RSI Forecast 14 > MA Forecast 14
🔹 RSI Forecast 14 < MA Forecast 14
🔹 RSI Forecast 15 > MA Forecast 15
🔹 RSI Forecast 15 < MA Forecast 15
🔹 RSI Forecast 16 > MA Forecast 16
🔹 RSI Forecast 16 < MA Forecast 16
🔹 RSI Forecast 17 > MA Forecast 17
🔹 RSI Forecast 17 < MA Forecast 17
🔹 RSI Forecast 18 > MA Forecast 18
🔹 RSI Forecast 18 < MA Forecast 18
🔹 RSI Forecast 19 > MA Forecast 19
🔹 RSI Forecast 19 < MA Forecast 19
🔹 RSI Forecast 20 > MA Forecast 20
🔹 RSI Forecast 20 < MA Forecast 20
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🔸 CONDITIONS TO SELL 📉
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• Signal Validity: The signal will remain valid for X bars .
• Signal Sequence: Configurable as AND or OR .
📉 RSI Conditions:
🔸 RSI > Upper
🔸 RSI < Upper
🔸 RSI > Lower
🔸 RSI < Lower
🔸 RSI > Middle
🔸 RSI < Middle
🔸 RSI > MA
🔸 RSI < MA
📉 MA Conditions:
🔸 MA > Upper
🔸 MA < Upper
🔸 MA > Lower
🔸 MA < Lower
📉 Crossovers:
🔸 RSI (Crossover) Upper
🔸 RSI (Crossunder) Upper
🔸 RSI (Crossover) Lower
🔸 RSI (Crossunder) Lower
🔸 RSI (Crossover) Middle
🔸 RSI (Crossunder) Middle
🔸 RSI (Crossover) MA
🔸 RSI (Crossunder) MA
🔸 MA (Crossover) Upper
🔸 MA (Crossunder) Upper
🔸 MA (Crossover) Lower
🔸 MA (Crossunder) Lower
📉 RSI Divergences:
🔸 RSI Divergence Bull
🔸 RSI Divergence Bear
📉 RSI Forecast:
🔸 RSI (Crossover) MA Forecast
🔸 RSI (Crossunder) MA Forecast
🔸 RSI Forecast 1 > MA Forecast 1
🔸 RSI Forecast 1 < MA Forecast 1
🔸 RSI Forecast 2 > MA Forecast 2
🔸 RSI Forecast 2 < MA Forecast 2
🔸 RSI Forecast 3 > MA Forecast 3
🔸 RSI Forecast 3 < MA Forecast 3
🔸 RSI Forecast 4 > MA Forecast 4
🔸 RSI Forecast 4 < MA Forecast 4
🔸 RSI Forecast 5 > MA Forecast 5
🔸 RSI Forecast 5 < MA Forecast 5
🔸 RSI Forecast 6 > MA Forecast 6
🔸 RSI Forecast 6 < MA Forecast 6
🔸 RSI Forecast 7 > MA Forecast 7
🔸 RSI Forecast 7 < MA Forecast 7
🔸 RSI Forecast 8 > MA Forecast 8
🔸 RSI Forecast 8 < MA Forecast 8
🔸 RSI Forecast 9 > MA Forecast 9
🔸 RSI Forecast 9 < MA Forecast 9
🔸 RSI Forecast 10 > MA Forecast 10
🔸 RSI Forecast 10 < MA Forecast 10
🔸 RSI Forecast 11 > MA Forecast 11
🔸 RSI Forecast 11 < MA Forecast 11
🔸 RSI Forecast 12 > MA Forecast 12
🔸 RSI Forecast 12 < MA Forecast 12
🔸 RSI Forecast 13 > MA Forecast 13
🔸 RSI Forecast 13 < MA Forecast 13
🔸 RSI Forecast 14 > MA Forecast 14
🔸 RSI Forecast 14 < MA Forecast 14
🔸 RSI Forecast 15 > MA Forecast 15
🔸 RSI Forecast 15 < MA Forecast 15
🔸 RSI Forecast 16 > MA Forecast 16
🔸 RSI Forecast 16 < MA Forecast 16
🔸 RSI Forecast 17 > MA Forecast 17
🔸 RSI Forecast 17 < MA Forecast 17
🔸 RSI Forecast 18 > MA Forecast 18
🔸 RSI Forecast 18 < MA Forecast 18
🔸 RSI Forecast 19 > MA Forecast 19
🔸 RSI Forecast 19 < MA Forecast 19
🔸 RSI Forecast 20 > MA Forecast 20
🔸 RSI Forecast 20 < MA Forecast 20
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🤖 AUTOMATION 🤖
• You can automate the BUY and SELL signals of this indicator.
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⯁ UNIQUE FEATURES
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Linear Regression: (Forecast)
Signal Validity: The signal will remain valid for X bars
Signal Sequence: Configurable as AND/OR
Condition Table: BUY/SELL
Condition Labels: BUY/SELL
Plot Labels in the Graph Above: BUY/SELL
Automate and Monitor Signals/Alerts: BUY/SELL
Linear Regression (Forecast)
Signal Validity: The signal will remain valid for X bars
Signal Sequence: Configurable as AND/OR
Condition Table: BUY/SELL
Condition Labels: BUY/SELL
Plot Labels in the Graph Above: BUY/SELL
Automate and Monitor Signals/Alerts: BUY/SELL
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📜 SCRIPT : RSI Full Forecast
🎴 Art by : @Titans_Invest & @DiFlip
👨💻 Dev by : @Titans_Invest & @DiFlip
🎑 Titans Invest — The Wizards Without Gloves 🧤
✨ Enjoy!
______________________________________________________
o Mission 🗺
• Inspire Traders to manifest Magic in the Market.
o Vision 𐓏
• To elevate collective Energy 𐓷𐓏
Swing High/Low & EMA Cross AlertScript Description:
This script on TradingView combines the detection of Swing High/Low points with exponential moving average (EMA) crossovers to provide buy and sell alerts and to mark swing points on the chart.
What the Script Does:
Swing High/Low Detection:
Uses the ta.pivothigh function to detect significant high points and the ta.pivotlow function to detect significant low points.
For each detected point, the script checks if it is a new higher high (HH) or lower high (LH) for the highs, and a new lower low (LL) or higher low (HL) for the lows.
Creates visual labels to identify these points on the chart, helping traders to visualize potential reversal points.
EMA Crossover:
Calculates two EMAs: a fast EMA (fastEMA) with a default period of 50 and a slow EMA (slowEMA) with a default period of 200.
Detects bullish crossovers (when fastEMA crosses above slowEMA) and bearish crossunders (when fastEMA crosses below slowEMA).
Generates buy and sell alerts based on these crossovers.
How the Script Works:
EMA Calculation: EMAs are calculated using the closing prices and user-defined periods.
Swing High/Low Detection: Uses the high and low values from the previous length bars to determine the swing points.
Alert Generation: Alerts are triggered when crossovers between the EMAs occur.
How to Use the Script:
Add to Chart: Insert the script into TradingView and apply it to the desired chart.
Configure Parameters:
Adjust the detection period for swing points (length).
Configure the periods for the EMAs (fastLen and slowLen).
Customize the colors for the swing point labels as per your preference.
Monitor Alerts: Use the EMA crossover alerts to make buy or sell decisions. Observe the swing point labels to identify potential trend reversals.
Justification for the Combination:
EMAs: Widely used to identify trend direction. Combining a fast EMA with a slow EMA helps capture both short-term and long-term trend changes.
Swing High/Low: Identifies reversal points in price, which are crucial for determining potential entry and exit points in trades.
Combination:
Combining EMAs and Swing High/Low provides a comprehensive view of price behavior, helping traders to effectively identify trends and reversal points.
This script is useful for traders who want to combine trend analysis (via EMAs) with the identification of reversal points (Swing High/Low), providing a more complete view of price behavior on the chart.
ATR Adjusted RSIATR Adjusted RSI Indicator
By Nathan Farmer
The ATR Adjusted RSI Indicator is a versatile indicator designed primarily for trend-following strategies, while also offering configurations for overbought/oversold (OB/OS) signals, making it suitable for mean-reversion setups. This tool combines the classic Relative Strength Index (RSI) with a unique Average True Range (ATR)-based smoothing mechanism, allowing traders to adjust their RSI signals according to market volatility for more reliable entries and exits.
Key Features:
ATR Weighted RSI:
At the core of this indicator is the ATR-adjusted RSI line, where the RSI is smoothed based on volatility (measured by the ATR). When volatility increases, the smoothing effect intensifies, resulting in a more stable and reliable RSI reading. This makes the indicator more responsive to market conditions, which is especially useful in trend-following systems.
Multiple Signal Types:
This indicator offers a variety of signal-generation methods, adaptable to different market environments and trading preferences:
RSI MA Crossovers: Generates signals when the RSI crosses above or below its moving average, with the flexibility to choose between different moving average types (SMA, EMA, WMA, etc.).
Midline Crossovers: Provides trend confirmation when either the RSI or its moving average crosses the 50 midline, signaling potential trend reversals.
ATR-Inversely Weighted RSI Variations: Uses the smoothed, ATR-adjusted RSI for a more refined and responsive trend-following signal. There are variations both for the MA crossover and the midline crossover.
Overbought/Oversold Conditions: Ideal for mean reversion setups, where signals are triggered when the RSI or its moving average crosses over overbought or oversold levels.
Flexible Customization:
With a wide range of customizable options, you can tailor the indicator to fit your personal trading style. Choose from various moving average types for the RSI, modify the ATR smoothing length, and adjust overbought/oversold levels to optimize your signals.
Usage:
While this indicator is primarily designed for trend-following, its OB/OS configurations make it highly effective for mean-reverting setups as well. Depending on your selected signal type, the relevant indicator line will change color between green and red to visually signal long or short opportunities. This flexibility allows traders to switch between trending and sideways market strategies seamlessly.
A Versatile Tool:
The ATR Adjusted RSI Indicator is a valuable component of any trading system, offering enhanced signals that adapt to market volatility. However, it is not recommended to rely on this indicator alone, especially without thorough backtesting. Its performance varies across different assets and timeframes, so it’s essential to experiment with the parameters to ensure consistent results before applying it in live trading.
Recommendation:
Before incorporating this indicator into live trading, backtest it extensively. Given its flexibility and wide range of signal-generation methods, backtesting allows you to optimize the settings for your preferred assets and timeframes. Only consider using it on it's own if you are confident in its performance based on your own backtest results, and even then, it is not recommended.
[TehThomas] - MA Cross with DisplacementThis TradingView script, "MA Cross with Displacement," is designed to detect potential long and short trade opportunities based on moving average (MA) crossovers combined with price displacement confirmation. The script utilizes two simple moving averages (SMA) and highlights potential trade signals when a crossover occurs alongside a strong price movement (displacement).
Why This Indicator is Useful
This indicator enhances the standard moving average crossover strategy by incorporating a displacement condition, making trade signals more reliable. Many traders rely on moving average crossovers to determine trend reversals, but false signals often occur due to minor price fluctuations. By requiring a significant price movement (displacement), this indicator helps filter out weak or insignificant crossovers, leading to more high-probability trade opportunities.
How It Works
Calculates Two Moving Averages (MA)
The user can set two different MA periods:
MA 1 (blue line): Default period is 9 (shorter-term trend).
MA 2 (red line): Default period is 21 (longer-term trend).
These moving averages smooth out price fluctuations to identify overall trends.
Detects Crossovers
Bullish crossover: The blue MA crosses above the red MA + displacement candle → Potential long signal.
Example of bullish cross with displacement:
Bearish crossover: The blue MA crosses below the red MA + displacement candle → Potential short signal.
Example of bearish cross with displacement:
Confirms Displacement (Strong Price Move)
A price displacement threshold is used (default: 1.1% of the previous candle size).
For a valid trade signal, a crossover must occur alongside a strong price movement.
Bullish Displacement Condition: Price increased by more than the threshold.
Bearish Displacement Condition: Price decreased by more than the threshold.
Visual Indicators on the Chart
Bars are colored green when there is a bullish displacement.
Bars are colored red when there is a bearish displacement.
These color changes help traders quickly identify potential trade setups.
How to Use the Indicator
Add the Script to Your Chart
Copy and paste the script into TradingView's Pine Script Editor.
Click "Add to Chart" to activate it.
Customize the Settings
Adjust the moving average periods to fit your trading strategy.
Modify the displacement threshold based on market volatility.
Change the bar colors for better visualization.
Look for Trade Signals
Long Trade (Buy Signal)
The blue MA crosses above the red MA (bullish crossover).
A green bar appears, confirming bullish displacement.
Short Trade (Sell Signal)
The blue MA crosses below the red MA (bearish crossover).
A red bar appears, confirming bearish displacement.
Use in Conjunction with Other Indicators
This indicator works best when combined with support & resistance levels, RSI, MACD, or volume analysis to improve trade accuracy.
Final Thoughts
The MA Cross with Displacement Indicator improves the reliability of moving average crossovers by requiring strong price movements to confirm a trade signal. This helps traders avoid false breakouts and weak trends, making it a powerful tool for identifying high-probability trades.
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Thanks for your support!
If you found this idea helpful or learned something new, drop a like 👍 and leave a comment—I’d love to hear your thoughts! 🚀
Make sure to follow me for more price action insights, free indicators, and trading strategies. Let’s grow and trade smarter together! 📈✨
Fractal Resonance ComponentLazyBear's WaveTrend port has been praised for highlighting trend reversals with precision and punctuality (minimal lag). But strong "3rd Wave" trends can "embed" or saturate any oscillator flashing several premature crosses while stuck overbought/oversold. This happens when the trend stretches over a longer timescale than the oscillator's averaging window or filter time constant. Our solution: simultaneously monitor many oscillator timescales. Watch for fresh crossovers in "dominant" timescales alternating most smoothly between the overbought (red shade) and oversold (green shade) range.
Fractal Resonance Component facilitates simultaneous viewing of eight timescales that are power of 2 multiples of the chart timescale. Each timescale shows lead line, lag line, lead-lag difference, and crossover marks. Add 4 to 8 copies to your chart for a good multi-fractal read. Format * the "Timescale Multiplier" attribute of each row to be twice that of the row above for a sequence like 1, 2, 4, 8, 16, 32, 64, 128...
Fractal Resonance Component shifts its timescales along with your choice of main chart timescale:
1 minute chart: 1 minute through 128 minute (~2 hour) oscillators.
1 hour chart: 1 hour through 128 hour (~2 week) oscillators.
Daily chart: 1 day through 128 day (~4 month) oscillators.
Crossovers in different oscillator ranges tend to have different meanings:
Minor (< 75%) crossovers: small green/red dot
usually noise
Overbought/Sold crossovers (shaded 75 to 100%): black outlined dot (o)
reliable reversal indicators (when they appear alone)
Extreme Overbought (> 100%) crossovers: black outlined plus (+).
Can be a major reversal in fast markets, but usually portend the end of Elliot 3rd waves with just a small corrective (4th wave) retrace before the larger impulsive (5-wave) sequence resumes in original direction.
The final 5th-wave terminus should appear later as a lone non-extreme (black outlined circle) crossover on a slower timescale coincident with weaker (non-extreme) dot crosses on this timescale.
Careful examination of historical charts leads to many useful observations such as:
Dominant crossovers punctuating true reversals are usually in the green/red shaded ranges with black outlined dots (o) rather than minor or Extreme (+) ranges.
Due to market's fractal nature, two well-separated timescales like 1 minute and 1 hour can show dominant crosses simultaneously in opposite directions, e.g. the 1 minute showing a very short term high and the 1 hour a medium term low nearby.
Staying Nimble
Watch out for embedding on your supposedly dominant timescale -- a second cross while stuck in the overbought/oversold region suggests a stronger, longer trend than expected. Drop your eyes to a slower timescale below for the real dominant whose crossover will validate main trend reversal.
Embedding can often be predicted even at the first cross mark by checking whether the green lead line of the next slower timescale (one row below) has already hit the Overbought or especially the Extreme Overbought range but isn't close to rolling over. Fractal Resonance Bar (to be published) uses this principle to mark embedded timescales with white stripes, warning of a powerful trend wave on longer timescales you shouldn't fight until the white stripes subside.
Overnight gaps surge all timescales in ways that obscure the dominant timescale, so for shorter than daily charts, these methods work best on Futures contracts that only suffer weekend gaps.
