Comprehensive Market Overview1. What is this indicator about?
The "Comprehensive Market Overview" indicator provides a holistic view of the market by incorporating several key metrics:
Close Price: Displays the current close price below each candle.
Percent from All-Time High: Calculates how far the current close price is from the highest high observed over a specified period.
RSI (Relative Strength Index): Measures the momentum of price movements to assess whether a stock is overbought or oversold.
Volume Gain: Computes the current volume relative to its 20-period simple moving average (SMA), indicating volume strength or weakness.
Volatility: Quantifies market volatility by calculating the ratio of the Bollinger Bands' width (difference between upper and lower bands) to the SMA.
2. How it works?
Close Price Label: This label is displayed below each bar, showing the current close price.
Percent from All-Time High: Calculates the percentage difference between the highest high observed (all-time high) and the current close price.
RSI Calculation: Computes the RSI using a 14-period setting, providing insight into whether a stock is potentially overbought or oversold.
Volume Strength: Computes the current volume divided by its 20-period SMA, indicating whether volume is above or below average.
Volatility Calculation: Calculates the width of the Bollinger Bands (based on a 20-period SMA and 2 standard deviations) and expresses it as a percentage of the SMA, providing a measure of market volatility
3.Correct Trend Identification with Indicators
All-Time High (ATH) Levels:
Low Value (Near ATH): When the percent from ATH is low (close to 0%), it indicates that the current price is near the all-time high zone. This suggests strong bullish momentum and potential resistance levels.
High Value (Below ATH): A high percentage from ATH indicates how much the current price is below the all-time high. This could signal potential support levels or opportunities for price recovery towards previous highs.
RSI (Relative Strength Index):
Overbought (High RSI): RSI values above 70 typically indicate that the asset is overbought, suggesting a potential reversal or correction in price.
Oversold (Low RSI): RSI values below 30 indicate oversold conditions, suggesting a potential rebound or price increase.
Swing Trading Strategies
Confirmation with Visual Analysis: Visualizing the chart to confirm ATH levels and RSI readings can provide strong indications of market sentiment and potential trading opportunities:
Bullish Signals: Look for prices near ATH with RSI confirming strength (not yet overbought), indicating potential continuation or breakout.
Bearish Signals: Prices significantly below ATH with RSI showing weakness (not yet oversold), indicating potential for a bounce or reversal.
Volume Confirmation: Comparing current volume to its SMA helps confirm the strength of price movements. Higher current volume relative to the SMA suggests strong price action.
Volatility Assessment: Monitoring volatility through the Bollinger Bands' width ratio helps assess potential price swings. Narrow bands suggest low volatility, while wide bands indicate higher volatility and potential trading opportunities.
4.Entry and Exit Points:
Entry: Consider entering long positions near support levels when prices are below ATH and RSI is oversold. Conversely, enter short positions near resistance levels when prices are near ATH and RSI is overbought.
Exit: Exit long positions near resistance or ATH levels when prices show signs of resistance or RSI becomes overbought. Exit short positions near support levels or when prices rebound from oversold conditions.
Risk Management: Always incorporate risk management techniques such as setting stop-loss orders based on support and resistance levels identified through ATH and RSI analysis.
Implementation Example
볼래틸리티
Consistent ATR Trailing Stop (ATR, 1m based) [nn1]This indicator implements a Consistent ATR (Average True Range) Trailing Stop that maintains uniform behavior across various chart timeframes. It's designed to provide traders with a reliable tool for setting dynamic stop-loss levels that adapt to market volatility while remaining consistent regardless of the chosen chart interval.
Key Features:
1. Consistent ATR Calculation: The indicator calculates the ATR based on 1-minute data, regardless of the current chart timeframe. This ensures that the ATR value remains consistent across different intervals (e.g., 10s, 15s, 30s, 60s), providing a stable base for the trailing stop.
2. Dynamic Trailing Stop: The trailing stop adjusts based on the ATR, moving up in uptrends and down in downtrends to protect profits while allowing room for price fluctuations.
3. Trend Detection: The indicator determines the trend based on the price's relationship to the trailing stop, switching between long and short modes as the trend changes.
4. Visual Cues: The trailing stop line changes color to indicate the current trend (green for uptrends, red for downtrends) and briefly turns yellow during trend changes. Small circles below or above the price action further highlight the current trend direction.
5. Information Display: A label shows the current ATR value and trend direction, providing at-a-glance information to the trader.
6. Trend Change Highlights: The background briefly changes color when a trend change occurs, drawing attention to potential trading opportunities or exit points.
Usage:
- ATR Length: Set the number of periods for the ATR calculation. This is based on 1-minute data, so a value of 14 represents 14 minutes of data.
- ATR Multiplier: Adjust how far the trailing stop is placed from the price. Higher values create a wider stop, allowing for more price movement before triggering.
This indicator is particularly useful for traders who:
- Use multiple timeframes in their analysis and want consistent signals across charts.
- Seek a dynamic stop-loss method that adapts to market volatility.
- Want clear visual cues for trend direction and changes.
By providing a consistent ATR-based trailing stop across different timeframes, this indicator helps traders maintain a unified approach to their trading strategy, regardless of the chart interval they are viewing.
Fair Value Gap (FVG) Oscillator [UAlgo]The "Fair Value Gap (FVG) Oscillator " is designed to identify and visualize Fair Value Gaps (FVG) within a given lookback period on a trading chart. This indicator helps traders by highlighting areas where price gaps may signify potential trading opportunities, specifically bullish and bearish patterns. By leveraging volume and Average True Range (ATR) data, the FVG Oscillator aims to enhance the accuracy of pattern recognition and provide more reliable signals for trading decisions.
🔶 Identification of Fair Value Gap (FVG)
Fair Value Gaps (FVG) are specific price areas where gaps occur, and they are often considered significant in technical analysis. These gaps can indicate potential future price movements as the market may return to fill these gaps. This indicator identifies two types of FVGs:
Bullish FVG: Occurs when the current low price is higher than the high price two periods ago. This condition suggests a potential upward price movement.
Obtains with:
low > high
Bearish FVG: Occurs when the current high price is lower than the low price two periods ago. This condition suggests a potential downward price movement.
Obtains with:
high < low
The FVG Oscillator not only identifies these gaps but also verifies them using volume and ATR conditions to ensure more reliable trading signals.
🔶 Key Features
Lookback Period: Users can set the lookback period to determine how far back the indicator should search for FVG patterns.
ATR Multiplier: The ATR Multiplier is used to adjust the sensitivity of the ATR-based conditions for verifying FVG patterns.
Volume SMA Period: This setting determines the period for the Simple Moving Average (SMA) of the volume, which helps in identifying high volume conditions.
Why ATR and Volume are Used?
ATR (Average True Range) and volume are integrated into the Fair Value Gap (FVG) Oscillator to enhance the accuracy and reliability of the identified patterns. ATR measures market volatility, helping to filter out insignificant price gaps and focus on impactful ones, ensuring that the signals are relevant and strong. Volume, on the other hand, confirms the strength of price movements. High volume often indicates the sustainability of these movements, reducing the likelihood of false signals. Together, ATR and volume ensure that the detected FVGs are both significant and supported by market activity, providing more trustworthy trading signals.
Normalized Values: The FVG counts are normalized to enhance the visual representation and interpretation of the patterns on the chart.
Visual Customization and Plotting: Users can customize the colors for positive (bullish) and negative (bearish) areas, and choose whether to display these areas on the chart, also plots the bullish and bearish FVG counts, a zero line, and the net value of FVG counts. Additionally, it uses histograms to display the width of verified bullish and bearish patterns.
🔶 Disclaimer:
Use with Caution: This indicator is provided for educational and informational purposes only and should not be considered as financial advice. Users should exercise caution and perform their own analysis before making trading decisions based on the indicator's signals.
Not Financial Advice: The information provided by this indicator does not constitute financial advice, and the creator (UAlgo) shall not be held responsible for any trading losses incurred as a result of using this indicator.
Backtesting Recommended: Traders are encouraged to backtest the indicator thoroughly on historical data before using it in live trading to assess its performance and suitability for their trading strategies.
Risk Management: Trading involves inherent risks, and users should implement proper risk management strategies, including but not limited to stop-loss orders and position sizing, to mitigate potential losses.
No Guarantees: The accuracy and reliability of the indicator's signals cannot be guaranteed, as they are based on historical price data and past performance may not be indicative of future results.
Internal Bar Strength IBS [Anan]This indicator calculates and displays the Internal Bar Strength (IBS) along with its moving average. The IBS is a measure that represents where the closing price is relative to the high-low range of a given period.
█ Main Formula
The core of this indicator is the Internal Bar Strength (IBS) calculation. The basic IBS formula is:
ibs = (close - low) / (high - low)
I enhanced the original formula by incorporating a user-defined length parameter. This modification allows for greater flexibility in analysis and interpretation. The extended version enables users to adjust the indicator's length according to their specific needs or market conditions. Notably, setting the length parameter to 1 reproduces the behavior of the original formula, maintaining backward compatibility while offering expanded functionality:
ibs = (close - ta.lowest(low, ibs_length)) / (ta.highest(high, ibs_length) - ta.lowest(low, ibs_length))
Where:
- `close` is the closing price of the current bar
- `lowest low` is the lowest low price over the specified IBS length
- `highest high` is the highest high price over the specified IBS length
█ Key Features
- Calculates IBS using a user-defined length
- Applies a moving average to the IBS values
- Offers multiple moving average types
- Includes optional Bollinger Bands or Donchian Channel overlays
- Visualizes bull and bear areas
█ Inputs
- IBS Length: The period used for IBS calculation
- MA Type: The type of moving average applied to IBS (options: SMA, EMA, SMMA, WMA, VWMA, Bollinger Bands, Donchian)
- MA Length: The period used for the moving average calculation
- BB StdDev: Standard deviation multiplier for Bollinger Bands
█ How to Use and Interpret
1. IBS Line Interpretation:
- IBS values range from 0 to 1
- Values close to 1 indicate the close was near the high, suggesting a bullish sentiment
- Values close to 0 indicate the close was near the low, suggesting a bearish sentiment
- Values around 0.5 suggest the close was near the middle of the range
2. Overbought/Oversold Conditions:
- IBS values above 0.8 (teal zone) may indicate overbought conditions
- IBS values below 0.2 (red zone) may indicate oversold conditions
- These zones can be used to identify potential reversal points
3. Trend Identification:
- Consistent IBS values above 0.5 may indicate an uptrend
- Consistent IBS values below 0.5 may indicate a downtrend
4. Using Moving Averages:
- The yellow MA line can help smooth out IBS fluctuations
- Crossovers between the IBS and its MA can signal potential trend changes
5. Bollinger Bands/Donchian Channel:
- When enabled, these can provide additional context for overbought/oversold conditions
- IBS touching or exceeding the upper band may indicate overbought conditions
- IBS touching or falling below the lower band may indicate oversold conditions
Remember that no single indicator should be used in isolation. Always combine IBS analysis with other technical indicators, price action analysis, and broader market context for more reliable trading decisions.
Nebula SAR Echo📈 Overview:
The "Nebula SAR Echo" is a sophisticated technical analysis tool designed for traders seeking enhanced trend detection. This indicator combines the robust Parabolic SAR mechanism with gradient color coding to provide clear visual insights into market trends.
🎯 Key Features:
Advanced Parabolic SAR Calculation:
Utilizes dynamic coefficients for more responsive and accurate trend detection.
Highlights trend reversals with visual markers for immediate identification.
Gradient Color Coding:
Gradient colors dynamically reflect the strength and direction of the trend.
Bullish trends are represented in shades of green, while bearish trends are shown in shades of red.
User-Friendly Customization:
Easily adjustable parameters for acceleration factors and gradient color use.
💡 Benefits:
Enhanced Decision Making:
Combines real-time trend analysis to assist traders in making more informed decisions.
Visual Clarity:
Clear visual markers and gradient color coding simplify the interpretation of market trends.
Helps traders quickly identify key turning points and potential future price paths.
🔍 Use Cases:
Trend Identification:
Ideal for identifying ongoing trends and potential reversals in various market conditions.
Useful for both short-term trading strategies and long-term investment planning.
Risk Management:
Gradient color coding aids in assessing trend strength and potential volatility.
Traders can set more precise stop-loss and take-profit levels based on the trend strength.
⚙️ How to Use:
1. Parameter Setup:
Set the desired acceleration factors (start, increment, and max) for the Parabolic SAR.
Enable or disable gradient colors based on personal preference.
2. Interpretation:
Use the SAR values and gradient colors to gauge current market trends.
3. Alerts:
Set up alert conditions for bullish and bearish reversals to stay notified of significant market changes.
🔹 Conclusion:
The "Nebula SAR Echo" is a versatile and powerful tool for traders who require an in-depth analysis of market trends. By leveraging the advanced Parabolic SAR calculation and gradient color coding, this indicator provides a comprehensive view of market conditions, making it an indispensable addition to any trader's toolkit.
Candle Range Detector [UAlgo]The "Candle Range Detector " is a Pine Script™ indicator designed to identify trading opportunities based on the concept of price consolidation and breakout. It analyzes the price range of a specified number of previous candles and detects when subsequent candles stay within that range (consolidation). The indicator then highlights potential breakouts above or below the range and provides calculated Take Profit (TP) and Stop Loss (SL) levels based on your chosen method (percentage or Average True Range - ATR).
🔶 Key Features
Configurable Range: Define the minimum number of candles required to establish a valid price range.
Breakout Detection: Identify potential breakouts above or below the established range based on your selection (close price or wick).
Take Profit & Stop Loss Levels: The indicator calculates TP and SL levels based on your chosen method (percentage or ATR) and user-defined multipliers. The calculated TP and SL levels are visualized as horizontal lines with corresponding labels ("Take Profit" and "Stop Loss").
Optional Count Display: You can choose to display the number of candles currently within the range.
🔶 Disclaimer:
Not Financial Advice: This indicator is intended for educational and informational purposes only. It does not constitute financial advice or recommendations to buy, sell, or hold any financial instruments.
Use at Own Risk: Trading involves substantial risk of loss and is not suitable for all investors. Users of this indicator should exercise caution and conduct their own research and analysis before making any trading decisions.
Performance Not Guaranteed: Past performance is not indicative of future results. While the indicator aims to assist traders in analyzing market trends, there is no guarantee of accuracy or success in trading operations.
🔷 Related Scripts
Range Finder
Lines of Chaos (ATR/ADR Levels)Lines of Chaos Indicator
This script is designed to provide traders with ATR (Average True Range) and ADR (Average Daily Range) support and resistance levels.
How it Works:
Support and Resistance Lines: The script plots ATR/ADR-based support and resistance lines based on a moving average of the last ATR/ADR Length days, the previous day's close, and the current day's open. Changing the ATR/ADR Length value changes the number of days of data to average.
EMA: The EMA is colored red when the ticker is potentially bearish. The EMA is colored green when the ticker is potentially bullish. Changing the EMA Length changes the number of data bars to average.
Default Settings: The default settings are optimized for most trading environments.
Key Features:
ATR & ADR Calculation: You can use ATR, ADR, or both. ATR is recommended for most scenarios.
Customizable Lengths: Adjust the ATR/ADR Length to refine the average calculation to your preference, with 14 being the standard value.
EMA for Market Bias: The EMA helps determine the ticker bias. It is colored green when the market is above the average price and red when below. This allows you to more easily determine whether or not the ADR/ATR levels are valid.
Versatile Usage: Suitable for various trading types, ensuring broad applicability across different market conditions.
How to Use:
Bounces off Levels: When the price bounces off a support/resistance level, the price will likely respect this level. This indicates that the price is unlikely to exceed the ticker's average volatility.
Breakthroughs of Levels: When the price breaks through a support/resistance level, the price will likely continue beyond this level. This indicates that the price has moved beyond that ticker's average volatility.
ATR/ADR Support and Resistance LevelsATR/ADR Support and Resistance Levels Indicator
This script is designed to provide traders with precise ATR (Average True Range) and ADR (Average Daily Range) support and resistance levels. It can be effectively used to identify price breakouts or rejections near these critical lines and assist in confirming trend retests.
How It Works:
Support and Resistance Lines: The script plots ATR/ADR-based support and resistance lines, which can be toggled on or off.
Daily Data Integration: It incorporates daily open and close prices to enhance the accuracy of the support and resistance levels.
Clear Visuals: The indicator uses distinct colors for support (green) and resistance (red) levels, providing clear visual cues.
Default Settings: The default settings are optimized for most trading environments. Adjusting the ATR/ADR Length can fine-tune the indicator's responsiveness to market movements.
Key Features:
ATR & ADR Calculation: Choose between using ATR, ADR, or both. ATR is recommended for most scenarios.
Customizable Lengths: Adjust the ATR/ADR Length to refine the average calculation to your preference, with 14 being the standard value.
EMA for Market Bias: The EMA helps determine the ticker bias. It is colored green when the market is above the average price and red when it is below. This allows you to more easily determine whether or not the ADR/ATR levels are valid.
Versatile Usage: Suitable for various trading types, ensuring broad applicability across different market conditions.
How to Use:
ATR vs ADR: You should use ADR if you are day trading AND do not want to include gap data in the levels. It is recommended you use ATR.
Bounces off Levels: When price bounces off of a support/resistance level, it is very likely that price will respect this level. This indicates that price is unlikely to move beyond the ticker's average volatility. You should wait for an additional bounce to confirm.
Breakthroughs of Levels: When price breaks through a support/resistance level, it is very likely that price will continue beyond this level. This indicates that price has moved beyond that ticker's average volatility. You should wait for a bounce off the level to confirm.
This indicator is a valuable tool for traders seeking to enhance their technical analysis with support and resistance levels based on ATR and ADR calculations. It is perfect for identifying key price points and understanding market trends.
RSI Trail [UAlgo]The RSI Trail indicator is a technical analysis tool designed to assist traders in making informed decisions by utilizing the Relative Strength Index (RSI) and various moving average calculations. This indicator dynamically plots support and resistance levels based on RSI values, providing visual cues for potential bullish and bearish signals. The inclusion of a trailing stop mechanism allows traders to adapt to market volatility, ensuring optimal entry and exit points.
🔶 Key Features
Multiple Moving Average Types: Choose from Simple Moving Average (SMA), Exponential Moving Average (EMA), Weighted Moving Average (WMA), Running Moving Average (RMA), and McGinley Dynamic for diverse analytical approaches.
Configurable RSI Bounds: Tailor the RSI lower and upper bounds to your specific trading preferences, with default settings at 40 and 60.
Signals: The indicator determines bullish and bearish market states and plots corresponding signals on the chart.
Customizable Visualization: Options to display the midline and color candles based on market state enhance visual analysis.
Alerts: Integrated alert conditions notify you of bullish and bearish signals.
🔶 Calculations
The RSI Trail indicator calculates dynamic support and resistance levels using a combination of moving averages and the Relative Strength Index (RSI). It starts by computing a chosen moving average (SMA, EMA, WMA, RMA, or McGinley) over a period of 27 using the typical price (ohlc4).
The indicator then defines upper and lower bounds based on customizable RSI levels (default 40 and 60) and adjusts these bounds using the Average True Range (ATR) to account for market volatility. The upper bound is calculated by adding a volatility-adjusted value to the moving average, while the lower bound is found by subtracting this value. Bullish signals occur when the price crosses above the upper bound, and bearish signals when it falls below the lower bound.
The RSI Trail indicator also can be used to identify pullback opportunities. When the price high/low crosses above/below the calculated upper/lower bound, it indicates a potential pullback, suggesting a favorable point to enter a trade during a pullback.
🔶 Disclaimer
This indicator is for informational purposes only and should not be considered financial advice.
Always conduct your own research and due diligence before making any trading decisions. Past performance is not necessarily indicative of future results.
Weighted Volume Profile | Flux Charts💎 GENERAL OVERVIEW
Introducing our new Weighted Volume Profile Indicator! This indicator renders a volume profile based on the volume of latest candlesticks. It can be adjusted to give more weight to recent or past candlesticks, or can be used as a normal volume profile. For more information, please read the full write-up.
Features of the new Weighted Volume Profile indicator :
Renders Volume Profile Of Current Ticker
Adjustable Weighthing Towards Past or Recent
Customizable Row Count & Maximum Distance
Left or Right Alignment
More Styling Options
🚩UNIQUENESS
This indicator differs from a normal volume profile indicator by it's ability to weight volumes based on their distance to the current time. Giving weight to volumes may offer new trading opportunities to traders as they can now see the most recent Point Of Control (POC) or a more powerful but past POC based on their choice. The indicator also has a variety of useful styling settings such as aligning the volume profile to the right or the left of the chart, POC Line styling and color settings for bullish & bearish volumes.
📌 HOW DOES IT WORK ?
A volume profile provides an in-depth look at trading activity over a period of time by plotting a histogram on the price axis. This indicator can also give weight to volumes based on their distance to the current time, essentially determining their importance for the profile. Here is how it works step-by-step :
1. Determine how much candlesticks the volume profile will cover (Analyze Bars setting)
2. Make a range from the highest point of chart to the lowest point of chart, then divide it into rows (Row Count setting)
3. For each candlestick, add it's volume to the corresponding row in the range. Note that the volume can be added into several rows if it overlaps with them.
4. If the candlestick is a bullish candlestick, we add it's volume into the bullish volume of the row, if it's a bearish candlestick, we add it to the bearish volume of the row.
With the weighted volume mode, which is activated if "Volume Weighthing" setting is set to "Recent" or "Past", all volumes get a penalty based on their distance to the latest candletstick. For example, if the setting is set to "Recent", the latest candlestick contributes it's volume by 100% to the corresponding row, but the candlestick which is 50 candlesticks far from the current candlestick only contributes it's volume by ~17% to the row. The same applies to the "Past" setting, but in the reversed order, where past candlesticks have more priority than the current ones.
Volume contribution percent for "Recent" setting : ((100 * 0.85) / (i + 1)) + (100 * (1.0 - 0.85))
Volume contribution percent for "Past" setting : ((100 * 0.85) * ((i + 1) / N)) + (100 * (1.0 - 0.85))
Where i = candlestick index from right to left, N = total number of candlesticks analyzed by the volume profile.
The Point Of Control (POC) line is drawn from the row with the most total volume, and is generally considered as a strong level because a lot of trading volume happened on that particular row. Traders may use this line as a support & resistance level.
Traders can use this indicator to have an insight of areas which price moves quickly without much volume, or see areas that holds the price still for much longer and plan their trades accordingly.
⚙️SETTINGS
1. General Configuration
Analyze Bars -> Total amount of bars that will be analyzed by the indicator from right to left.
Row Count -> The amount of rows that will the vertical range of chart will be divided into.
Volume Weighting -> The volume weighting mode as explained in the write-up.
2. Style
Align To -> The alignment of the volume profile.
[SGM Volatility Lvl]Choppiness Index (CI)
The Choppiness Index is a technical analysis tool used to determine whether a market is trending or consolidating. CI values range between 0 and 100:
- Higher values (close to 100) indicate a choppy market (i.e., the market is consolidating and not trending strongly).
- Lower values (close to 0) signify a trending market (either up or down).
In this script:
- CI values above 62 are considered to represent high volatility.
- CI values below 28 are viewed as representing lower volatility or consolidation.
How the Indicator Works
Choppiness Index Calculation
The CI is calculated using the average true range (ATR) and the high-low range over the specified length:
ci = 100 * math.log10(math.sum(ta.atr(1), length_line) / (ta.highest(length_line) - ta.lowest(length_line))) / math.log10(length_line)
Volatility Determination
The script determines the market's volatility state based on CI:
if ci >= 62
ischarge := 2
if ci <= 28
ischarge := 0
- ischarge = 2 indicates high volatility.
- ischarge = 0 indicates consolidation.
Line Setup
Lines are set on the chart based on the market's volatility:
- If CI increases and indicates high volatility, a line (colored with `volcolor`) is drawn at the close price of the bar.
- If CI decreases and indicates consolidation, a line (colored with `conColor`) is drawn at the close price of the bar.
Line Extension
The lines are automatically extended to the next indicator update or bar:
for i = 0 to array.size(ray) - 1
if i < array.size(ray) - 1
current_line = array.get(ray, i)
next_line = array.get(ray, i + 1)
if not na(current_line) and not na(next_line)
line.set_x2(current_line, line.get_x1(next_line))
else
line.set_x2(current_line, bar_index)
Relevance
Identifying Key Levels
The indicator helps traders identify key levels as follows:
- High Volatility : Lines indicating high volatility suggest strong trending movements. These levels can signify breakout points or areas where the price has made significant moves.
- Consolidation : Lines indicating consolidation suggest the market is ranging. These levels can be used to identify sideways movements, areas of accumulation or distribution, and potential breakout zones.
Potential Future Points of Interest
- High Volatility Lines: Can serve as resistance or support levels if the market revisits these areas.
- Consolidation Lines: Highlight potential zones for price breakouts or reversals when the market transitions from consolidation to a trending phase.
In summary, this indicator can be particularly useful for traders looking to identify periods of high volatility and consolidation. By marking such periods on the chart, traders can better understand market behavior and spot potential trading opportunities.
[Pandora] Vast Volatility Treasure TroveINTRODUCTION:
Volatility enthusiasts, prepare for VICTORY on this day of July 4th, 2024! This is my "Vast Volatility Treasure Trove," intended mostly for educational purposes, yet these functions will also exhibit versatility when combined with other algorithms to garner statistical excellence. Once again, I am now ripping the lid off of Pandora's box... of volatility. Inside this script is a 'vast' collection of volatility estimators, reflecting the indicators name. Whether you are a seasoned trader destined to navigate financial strife or an eagerly curious learner, this script offers a comprehensive toolkit for a broad spectrum of volatility analysis. Enjoy your journey through the realm of market volatility with this code!
WHAT IS MARKET VOLATILITY?:
Market volatility refers to various fluctuations in the value of a financial market or asset over a period of time, often characterized by occasional rapid and significant deviations in price. During periods of greater market volatility, evolving conditions of prices can move rapidly in either direction, creating uncertainty for investors with results of sharp declines as well as rapid gains. However, market volatility is a typical aspect expected in financial markets that can also present opportunities for informed decision-making and potential benefits from the price flux.
SCRIPT INTENTION:
Volatility is assuredly omnipresent, waxing and waning in magnitude, and some readers have every intention of studying and/or measuring it. This script serves as an all-in-one armada of volatility estimators for TradingView members. I set out to provide a diverse set of tools to analyze and interpret market volatility, offering volatile insights, and aid with the development of robust trading indicators and strategies.
In today's fast-paced financial markets, understanding and quantifying volatility is informative for both seasoned traders and novice investors. This script is designed to empower users by equipping them with a comprehensive suite of volatility estimators. Each function within this script has been meticulously crafted to address various aspects of volatility, from traditional methods like Garman-Klass and Parkinson to more advanced techniques like Yang-Zhang and my custom experimental algorithms.
Ultimately, this script is more than just a collection of functions. It is a gateway to a deeper understanding of market volatility and a valuable resource for anyone committed to mastering the complexities of financial markets.
SCRIPT CONTENTS:
This script includes a variety of functions designed to measure and analyze market volatility. Where applicable, an input checkbox option provides an unbiased/biased estimate. Below is a brief description of each function in the original order they appear as code upon first publish:
Parkinson Volatility - Estimates volatility emphasizing the high and low range movements.
Alternate Parkinson Volatility - Simpler version of the original Parkinson Volatility that I realized.
Garman-Klass Volatility - Estimates volatility based on high, low, open, and close prices using a formula that adjusts for biases in price dynamics.
Rogers-Satchell-Yoon Volatility #1 - Estimates volatility based on logarithmic differences between high, low, open, and close values.
Rogers-Satchell-Yoon Volatility #2 - Similar estimate to Rogers-Satchell with the same result via an alternate formulation of volatility.
Yang-Zhang Volatility - An advanced volatility estimate combining both strengths of the Garman-Klass and Rogers-Satchell estimators, with weights determined by an alpha parameter.
Yang-Zhang (Modified) Volatility - My experimental modification slightly different from the Yang-Zhang formula with improved computational efficiency.
Selectable Volatility - Basic customizable volatility calculation based on the logarithmic difference between selected numerator and denominator prices (e.g., open, high, low, close).
Close-to-Close Volatility - Estimates volatility using the logarithmic difference between consecutive closing prices. Specifically applicable to data sources without open, high, and low prices.
Open-to-Close Volatility - (Overnight Volatility): Estimates volatility based on the logarithmic difference between the opening price and the last closing price emphasizing overnight gaps.
Hilo Volatility - Estimates volatility using a method similar to Parkinson's method, which considers the logarithm of the high and low prices.
Vantage Volatility - My experimental custom 'vantage' method to estimate volatility similar to Yang-Zhang, which incorporates various factors (Alpha, Beta, Gamma) to generate a weighted logarithmic calculation. This may be a volatility advantage or disadvantage, hence it's name.
Schwert Volatility - Estimates volatility based on arithmetic returns.
Historical Volatility - Estimates volatility considering logarithmic returns.
Annualized Historical Volatility - Estimates annualized volatility using logarithmic returns, adjusted for the number of trading days in a year.
If I omitted any other known varieties, detailed requests for future consideration can be made below for their inclusion into this script within future versions...
BONUS ALGORITHMS:
This script also includes several experimental and bonus functions that push the boundaries of volatility analysis as I understand it. These functions are designed to provide additional insights and also are my ideal notions for traders looking to explore other methods of volatility measurement.
VOLATILITY APPLICATIONS:
Volatility estimators serve a common role across various facets of trading and financial analysis, offering insights into market behavior. These tools are already in instrumental with enhancing risk management practices by providing a deeper understanding of market dynamics and the inherent uncertainty in asset prices. With volatility estimators, traders can effectively quantifying market risk and adjust their strategies accordingly, optimizing portfolio performance and mitigating potential losses. Additionally, volatility estimations may serve as indication for detecting overbought or oversold market conditions, offering probabilistic insights that could inform strategic decisions at turning points. This script
distinctly offers a variety of volatility estimators to navigate intricate financial terrains with informed judgment to address challenges of strategic planning.
CODE REUSE:
You don't have to ask for my permission to use/reuse these functions in your published scripts, simply because I have better things to do than answer requests for the reuse of these functions.
Notice: Unfortunately, I will not provide any integration support into member's projects at all. I have my own projects that require way too much of my day already.
ATR Gerchik LightAverage True Range ( ATR ) is a technical analysis indicator that measures volatility in the market. ATR is a moving average of the true range over a period of time.
ATR calculation procedure:
1. Determine the true maximum - this is the highest of the current maximum and yesterday's closing price of the day.
2. Determine the true minimum - this is the smallest of the current minimum and yesterday's closing price.
3. Determine the true range - this is the distance between the true maximum and minimum.
4. We exclude extremely large candles (> x2 ATR) and extremely small ones (< 0.5 ATR) from the obtained true ranges.
5. We calculate the average for the selected period based on the remaining range.
6. We calculate the percentage of the current True Range relative to the average ATR value for the previous period.
Description:
If you analyze it yourself, you will see that 75-80% of the time, the instrument moves only 1 ATR per day. You must understand that if an instrument has, for example, moved 80% of its daily range, it is not advisable to purchase it. This is comparable to a car's fuel tank: if the tank is almost empty, the car won't go far. Most indicators that calculate ATR include anomalous candles, which give unreliable results and lead to incorrect decisions. Because of this, many traders prefer to calculate ATR on their own.
However, the Gerchik ATR indicator accounts for anomalous candles and filters out extremely large candles (> 2x ATR) and extremely small ones (< 0.5x ATR). Additionally, this indicator immediately shows the consumed “fuel” of the instrument as a percentage, so you don't have to calculate the distance traveled yourself. This allows you to make quick, informed decisions. If we see that the tank is almost empty, it is logical not to get into that car today. When building any strategy, you must rely on the average movement.
Key Features:
Anomalous Candle Filtering: Excludes extremely large and small candles to provide more reliable ATR values.
Consumed Fuel Indicator: Shows the percentage of the ATR consumed, helping traders quickly assess the remaining potential movement.
Daily Timeframe Focus: Designed specifically for use on daily charts for accurate long-term analysis.
Practical Applications:
Entry and Exit Points: Use the ATR to determine optimal entry and exit points by assessing market volatility and potential price movement.
Stop-Loss Placement: Calculate stop-loss levels based on ATR to ensure they are placed at appropriate distances, accounting for current market volatility.
Trend Confirmation: Use the percentage of ATR consumed to confirm the strength of a trend and decide whether to enter or exit trades.
Examples of Use:
Trend Following: During strong trends, ATR helps identify periods of increased volatility, signaling potential breakouts or reversals.
Range Trading: In ranging markets, ATR can highlight periods of low volatility, indicating consolidation and potential breakout zones.
Note: The indicator is displayed and works only on the daily timeframe!
The indicator was created according to the instructions, description of the functionality, and strategy of Mr. Gerchik. Thank you so much, Chief!
________________________
Average True Range ( ATR , средний истинный диапазон) – это индикатор технического анализа, который измеряет волатильность на рынке. ATR представляет собой скользящее среднее истинного диапазона за определенный период времени.
Порядок расчета ATR:
1. Определяем истинный максимум – это наивысшее из текущего максимума и вчерашней цены закрытия дня.
2. Определяем истинный минимум – это наименьшее из текущего минимума и вчерашней цены закрытия.
3. Определяем истинный диапазон – это расстояние между истинным максимумом и минимумом.
4. Исключаем из полученных истинных диапазонов экстремально большие свечи (> x2 ATR) и экстремально маленькие (< 0.5 ATR).
5. Рассчитываем среднее за выбранный период исходя из оставшегося диапазона.
6 . Рассчитываем процент текущего истинного диапазона (True Range) относительно среднего значения ATR за предыдущий период.
Описание:
Если вы сами проанализируете, то увидите, что 75-80% времени инструмент ходит только 1 ATR. И вы должны понимать, что если инструмент внутри дня прошел, к примеру, 80% своего движения, то этот инструмент больше нельзя покупать. Это можно сравнить с баком машины: если бак почти пустой, машина далеко не уедет. Большинство индикаторов, которые рассчитывают ATR, производят расчет с паранормальными свечами. Это дает недостоверный результат и приводит к неверным решениям. Многие трейдеры из-за этого не используют готовые индикаторы и предпочитают считать ATR самостоятельно. Но индикатор ATR Gerchik учитывает паранормальные свечи и фильтрует экстремально большие свечи (> x2 ATR) и экстремально маленькие (< 0.5 ATR). Также этот индикатор сразу показывает израсходованный "бензин" инструмента в процентах. И вам не надо самостоятельно высчитывать пройденный путь. Вы можете быстро принимать правильные решения. Если мы видим, что бак почти пустой, логично не садиться в эту машину сегодня. Когда вы строите какую-то стратегию, вы должны обязательно полагаться на среднестатистическое движение.
Существует много стратегий, завязанных на ATR, которые учитывают волатильность инструмента, запас хода, точки разворота, места выставления стоп-лоссов (SL) и тейк-профитов (TP) и другие факторы. Я не буду останавливаться на них, так как каждый может найти описание этих стратегий и использовать их на свой выбор.
Индикатор отображается и работает только на дневном таймфрейме!
Индикатор создан по наставлениям, описанию функционала и стратегии господина Герчика. Огромное спасибо, Шеф!
ICT Single Candle Order Block (SCOB) [UAlgo]The "ICT Single Candle Order Block (SCOB) " designed for traders who utilize the concept of Order Blocks in their trading strategy. Order Blocks are significant price levels where institutions or smart money have placed their trades, leading to potential future price reactions when these levels are revisited. This indicator focuses on identifying and highlighting Single Candle Order Blocks (SCOBs), allowing traders to visually analyze key price levels on their charts.
🔶 What is Single Candle Order Block (SCOB) ?
A Single Candle Order Block (SCOB) is a specific type of Order Block that is identified based on a single candlestick pattern. These patterns indicate potential areas where significant buying or selling interest has occurred, often leading to a notable price reaction when revisited. In the context of this indicator, a bullish SCOB is identified when a specific bullish candlestick pattern is met, and a bearish SCOB is identified based on a bearish candlestick pattern.
Bullish SCOB: Detected when the open price of two bars ago is higher than its close, the close price of the previous bar is higher than its open, the current close price is higher than the open, the low of the previous bar is lower than the low of two bars ago, and the current close is higher than the high of the previous bar.
Bearish SCOB: Detected when the open price of two bars ago is lower than its close, the close price of the previous bar is lower than its open, the current close price is lower than the open, the high of the previous bar is higher than the high of two bars ago, and the current close is lower than the low of the previous bar.
🔶 Key Features
Show Single Candle Order Block (SCOB): Toggle the visibility of the Single Candle Order Blocks on the chart.
Mitigation Method: Choose between "Close" and "Wick" methods for determining whether a SCOB has been mitigated (price has interacted with the block).
Show Last X SCOBs: Control the number of most recent SCOBs displayed on the chart, allowing you to focus on the most relevant price levels.
Volatility Filter: Enable or disable the volatility filter, which uses the Average True Range (ATR) to filter out less significant SCOBs. When enabled, only SCOBs with an ATR above the mean value of the ATR are displayed.
Customizable Colors: Configure the colors for bullish and bearish SCOBs to enhance visual clarity. The indicator uses cooler RGB values to ensure the blocks are distinct and easily noticeable.
🔶 Disclaimer
The "ICT Single Candle Order Block (SCOB) " indicator is provided for educational and informational purposes only. Trading involves significant risk and may not be suitable for all investors.
Past performance is not indicative of future results. Users should use this indicator in conjunction with their own research and trading strategy.
VWAP Bands [UAlgo]The "VWAP Bands " indicator is designed to provide traders with valuable insights into market trends and potential support/resistance levels using Volume Weighted Average Price (VWAP) bands. This indicator integrates the core concepts of VWAP with additional trend analysis features, making it a versatile tool for both range trading and trend-following strategies.
The VWAP bands are plotted based on the standard deviation multipliers, creating upper and lower bands around the VWAP. These bands serve as dynamic support and resistance levels. When the price approaches these bands, traders can anticipate potential reversals or continuations of the current trend. Additionally, the indicator provides visual cues for trend strength and potential trend changes, helping traders make informed decisions in various market conditions.
🔶 Settings
Source (Data Source): The data source for VWAP calculations. The default setting is the typical price (HLC3), which is the average of the high, low, and close prices.
Length: The number of bars used in the VWAP calculation. This determines the lookback period for the indicator.
Standard Deviation Multiplier: The multiplier applied to the standard deviation to create the primary upper and lower VWAP bands. This setting controls the distance of the bands from the VWAP.
Secondary Standard Deviation Multiplier: The multiplier applied to the standard deviation to create the secondary upper and lower VWAP bands, providing additional levels of support and resistance.
Display Trend: A toggle to enable or disable the display of the trend analysis feature. When enabled, the indicator highlights trend strength and potential trend changes.
Display Trend Crossovers: A toggle to enable or disable the display of trend crossover signals. When enabled, the indicator plots shapes to indicate where trend switches are likely occurring.
🔶 Calculations
The calculations behind the "VWAP Bands " indicator begin with determining the Volume Weighted Average Price (VWAP), which provides a comprehensive view of the average price of an asset, weighted by trading volume. This gives a more accurate representation of the asset's true average price over a specified period.
The first step in this process involves summing the trading volume over a chosen period, typically represented by the length parameter. Simultaneously, the product of the price (usually an average of the high, low, and close prices) and the trading volume is calculated and summed. By dividing this cumulative price-volume product by the total volume, we obtain the VWAP value. This VWAP serves as the central anchor around which the price action oscillates.
To enhance the utility of VWAP, we introduce standard deviation calculations. Standard deviation measures the extent of price dispersion from the VWAP, providing insight into price volatility. By calculating the variance (which involves the squared deviations of price) and then taking its square root, we derive the standard deviation. This helps in understanding how far prices typically stray from the VWAP.
With the VWAP and standard deviation in hand, we then establish upper and lower bands by adding and subtracting multiples of the standard deviation from the VWAP. These bands act as dynamic support and resistance levels, adapting to changes in market volatility. The primary bands, set by the first standard deviation multiplier, are augmented by secondary bands defined by a larger multiplier, offering additional layers of potential support and resistance.
It also integrates trend analysis, highlighting areas where the price action suggests a strong or weak trend. This is achieved by overlaying colored zones above and below the bands, indicating the strength and direction of the trend. When the price crosses these bands, it signals potential trend changes, aiding traders in making timely decisions.
🔶 Disclaimer
The "VWAP Bands " indicator is provided for educational and informational purposes only. It is not intended as financial advice and should not be construed as such.
Trading involves significant risk and may not be suitable for all investors. Before using this indicator or making any investment decisions, it is important to conduct thorough research and consider your financial situation.
Supports & Resistances [UAlgo]The "Supports & Resistances " indicator is designed to identify and visualize key support and resistance levels on the price chart. It utilizes the Average True Range (ATR) and Pivot Points to define the boundaries of S & R zones and considers historical price action to assess the strength of these zones.
🔶 How to Obtain Zones
The script continuously analyzes the price action and identifies potential support and resistance zones based on the following criteria:
Zone Creation: For swing highs, a zone is created with the high price at the zone length as the top and the top minus the Average True Range (ATR) as the bottom. Conversely, for swing lows, the zone is created with the low price at the zone length as the bottom and the low plus the ATR as the top.
Zone Strength Calculation: The script iterates through historical bars within the zone and counts how many times the price (low for support, high for resistance) touched but failed to break entirely through the zone. This count is assigned as the zone's "strength".
Zone Display and Removal: It identifying zones by assigning a "strength" value based on how many times the price has approached but failed to break the zone. This helps prioritize stronger potential support/resistance levels. Only zones exceeding the defined "strength threshold" are visually displayed on the chart. Weaker zones or those broken by price are automatically removed.
🔶 Parameters
Zone Length: Traders can adjust S & R detection sensitivity, length to be used to find pivot points.
Strength Threshold: Set the minimum number of times the price needs to touch but fail to break a zone for it to be considered "strong" and displayed.
Visual Settings: Tailor the appearance of the support/resistance zones by defining separate colors and text size for borders, backgrounds, and zone text.
🔶 Disclaimer
The "Supports & Resistances " indicator is provided for educational and informational purposes only.
It should not be considered as financial advice or a recommendation to buy or sell any financial instrument.
The use of this indicator involves inherent risks, and users should employ their own judgment and conduct their own research before making any trading decisions. Past performance is not indicative of future results.
🔷 Related Scripts
Support and Resistance with Signals
ATR Based Support and Resistance Zones
Matt Liq LinesIndicator Overview
The "Matt Liq Lines" indicator is designed to help traders identify significant price levels where high-volume trading occurred. These levels are often referred to as liquidation levels and can act as support or resistance in the market. The indicator plots horizontal lines on the chart at these identified levels, helping traders make informed decisions based on volume spikes.
Key Features
Volume Multiplier: A user-defined threshold to identify high-volume candles. If a candle's volume is greater than the average volume multiplied by this multiplier, it is considered a high-volume candle.
Lookback Period: The period over which the average volume is calculated. This helps in smoothing out volume data to identify significant spikes.
Max Levels: The maximum number of liquidation levels to display on the chart. This helps in keeping the chart clean and focuses on the most relevant levels.
Indicator Components
Average Volume Calculation:
avgVolume = ta.sma(volume, lookbackPeriod)
Calculates the simple moving average (SMA) of the volume over the specified lookback period.
High Volume Identification:
highVolume = volume > (avgVolume * volumeMultiplier)
Identifies if the current candle's volume is greater than the average volume multiplied by the volume multiplier.
Liquidation Levels Storage:
Uses arrays to store the levels, their corresponding bar indices, and volumes.
Adding Liquidation Levels:
When a high-volume candle is identified, its open price is added as a liquidation level. If the maximum number of levels is exceeded, the oldest level is removed to make room for the new one.
Cleaning Levels:
A function f_clean_levels removes crossed levels (where the price has already moved above and below the level) and keeps the levels with the highest volumes.
Plotting Liquidation Lines:
Horizontal lines are drawn at the identified liquidation levels. These lines extend to the right and help traders visualize important price levels.
How to Use the Indicator
Set the Volume Multiplier: Adjust the volume multiplier to filter out minor volume spikes and focus on significant ones.
Adjust the Lookback Period: Set a lookback period that reflects the typical trading volume for the asset you are analyzing.
Configure Max Levels: Decide the number of levels you want to display on the chart to avoid clutter.
Interpret the Lines: Use the plotted lines as potential support or resistance levels. These lines indicate where significant trading activity has occurred, which could influence future price movements.
By following these steps and understanding the indicator's components, traders can effectively use the "Matt Liq Lines" indicator to identify key price levels influenced by high trading volumes, aiding in better decision-making
Fractal Breakout Trend Following StrategyOverview
The Fractal Breakout Trend Following Strategy is a trend-following system which utilizes the Willams Fractals and Alligator to execute the long trades on the fractal's breakouts which have a high probability to be the new uptrend phase beginning. This system also uses the normalized Average True Range indicator to filter trades after a large moves, because it's more likely to see the trend continuation after a consolidation period. Strategy can execute only long trades.
Unique Features
Trend and volatility filtering system: Strategy uses Williams Alligator to filter the counter-trend fractals breakouts and normalized Average True Range to avoid the trades after large moves, when volatility is high
Configurable Trading Periods: Users can tailor the strategy to specific market windows, adapting to different market conditions.
Flexible Risk Management: Users can choose the stop-loss percent (by default = 3%) for trades, but strategy also has the dynamic stop-loss level using down fractals.
Methodology
The strategy places stop order at the last valid fractal breakout level. Validity of this fractal is defined by the Williams Alligator indicator. If at the moment of time when price breaking the last fractal price is higher than Alligator's teeth line (8 period SMA shifted 5 bars in the future) this is a valid breakout. Moreover strategy has the additional volatility filtering system using normalized ATR. It calculates the average normalized ATR for last user-defined number of bars and if this value lower than the user-defined threshold value the long trade is executed.
When trade is opened, script places the stop loss at the price higher of two levels: user defined stop-loss from the position entry price or down fractal validation level. The down fractal is valid with the rule, opposite as the up fractal validation. Price shall break to the downside the last down fractal below the Willians Alligator's teeth line.
Strategy has no fixed take profit. Exit level changes with the down fractal validation level. If price is in strong uptrend trade is going to be active until last down fractal is not valid. Strategy closes trade when price hits the down fractal validation level.
Risk Management
The strategy employs a combined approach to risk management:
It allows positions to ride the trend as long as the price continues to move favorably, aiming to capture significant price movements. It features a user-defined stop-loss parameter to mitigate risks based on individual risk tolerance. By default, this stop-loss is set to a 3% drop from the entry point, but it can be adjusted according to the trader's preferences.
Justification of Methodology
This strategy leverages Williams Fractals to open long trade when price has broken the key resistance level to the upside. This resistance level is the last up fractal and is shall be broken above the Williams Alligator's teeth line to be qualified as the valid breakout according to this strategy. The Alligator filtering increases the probability to avoid the false breakouts against the current trend.
Moreover strategy has an additional filter using Average True Range(ATR) indicator. If average value of ATR for the last user-defined number of bars is lower than user-defined threshold strategy can open the long trade according to open trade condition above. The logic here is following: we want to open trades after period of price consolidation inside the range because before and after a big move price is more likely to be in sideways, but we need a trend move to have a profit.
Another one important feature is how the exit condition is defined. On the one hand, strategy has the user-defined stop-loss (3% below the entry price by default). It's made to give users the opportunity to restrict their losses according to their risk-tolerance. On the other hand, strategy utilizes the dynamic exit level which is defined by down fractal activation. If we assume the breaking up fractal is the beginning of the uptrend, breaking down fractal can be the start of downtrend phase. We don't want to be in long trade if there is a high probability of reversal to the downside. This approach helps to not keep open trade if trend is not developing and hold it if price continues going up.
Backtest Results
Operating window: Date range of backtests is 2023.01.01 - 2024.05.01. It is chosen to let the strategy to close all opened positions.
Commission and Slippage: Includes a standard Binance commission of 0.1% and accounts for possible slippage over 5 ticks.
Initial capital: 10000 USDT
Percent of capital used in every trade: 30%
Maximum Single Position Loss: -3.19%
Maximum Single Profit: +24.97%
Net Profit: +3036.90 USDT (+30.37%)
Total Trades: 83 (28.92% win rate)
Profit Factor: 1.953
Maximum Accumulated Loss: 963.98 USDT (-8.29%)
Average Profit per Trade: 36.59 USDT (+1.12%)
Average Trade Duration: 72 hours
These results are obtained with realistic parameters representing trading conditions observed at major exchanges such as Binance and with realistic trading portfolio usage parameters.
How to Use
Add the script to favorites for easy access.
Apply to the desired timeframe and chart (optimal performance observed on 4h and higher time frames and the BTC/USDT).
Configure settings using the dropdown choice list in the built-in menu.
Set up alerts to automate strategy positions through web hook with the text: {{strategy.order.alert_message}}
Disclaimer:
Educational and informational tool reflecting Skyrex commitment to informed trading. Past performance does not guarantee future results. Test strategies in a simulated environment before live implementation
Volume-Adjusted Bollinger BandsThe Volume-Adjusted Bollinger Bands (VABB) indicator is an advanced technical analysis tool that enhances the traditional Bollinger Bands by incorporating volume data. This integration allows the bands to dynamically adjust based on market volume, providing a more nuanced view of price movements and volatility. The key qualities of the VABB indicator include:
1. Dynamic Adjustment with Volume: Traditional Bollinger Bands are based solely on price data and standard deviations. The VABB indicator adjusts the width of the bands based on the volume ratio, making them more responsive to changes in market activity. This means that during periods of high volume, the bands will expand, and during periods of low volume, they will contract. This adjustment helps to reinforce the significance of price movements relative to the central line (VWMA).
2. Volume-Weighted Moving Average (VWMA): Instead of using a simple moving average (SMA) as the central line, the VABB uses the VWMA, which weights prices by volume. This provides a more accurate representation of the average price level, considering the trading volume.
3. Enhanced Signal Reliability: By incorporating volume, the VABB can filter out false signals that might occur in low-volume conditions. This makes the indicator particularly useful for identifying significant price movements that are supported by strong trading activity.
How to Use and Interpret the VABB Indicator
To use the VABB indicator, you need to set it up on your trading platform with the following parameters:
1. BB Length: The number of periods for calculating the Bollinger Bands (default is 20).
2. BB Multiplier: The multiplier for the standard deviation to set the width of the Bollinger Bands (default is 2.0).
3. Volume MA Length: The number of periods for calculating the moving average of the volume (default is 14).
Volume Ratio Smoothing Length: The number of periods for smoothing the volume ratio (default is 5).
Interpretation
1.Trend Identification: The VWMA serves as the central line. When the price is above the VWMA, it indicates an uptrend, and when it is below, it indicates a downtrend. The direction of the VWMA itself can also signal the trend's strength.
2. Volatility and Volume Analysis: The width of the VABB bands reflects both volatility and volume. Wider bands indicate high volatility and/or high volume, suggesting significant price movements. Narrower bands indicate low volatility and/or low volume, suggesting consolidation.
3. Trading Signals:
Breakouts: A price move outside the adjusted upper or lower bands can signal a potential breakout. High volume during such moves reinforces the breakout's validity.
Reversals: When the price touches or crosses the adjusted upper band, it may indicate overbought conditions, while touching or crossing the adjusted lower band may indicate oversold conditions. These conditions can signal potential reversals, especially if confirmed by other indicators or volume patterns.
Volume Confirmation: The volume ratio component helps confirm the strength of price movements. For instance, a breakout accompanied by a high volume ratio is more likely to be sustained than one with a low volume ratio.
Practical Example
Bullish Scenario: If the price crosses above the adjusted upper band with a high volume ratio, it suggests a strong bullish breakout. Traders might consider entering a long position, setting a stop-loss just below the VWMA or the lower band.
Bearish Scenario: Conversely, if the price crosses below the adjusted lower band with a high volume ratio, it suggests a strong bearish breakout. Traders might consider entering a short position, setting a stop-loss just above the VWMA or the upper band.
Conclusion
The Volume-Adjusted Bollinger Bands (VABB) indicator is a powerful tool that enhances traditional Bollinger Bands by incorporating volume data. This dynamic adjustment helps traders better understand market conditions and make more informed trading decisions. By using the VABB indicator, traders can identify significant price movements supported by volume, improving the reliability of their trading signals.
The Volume-Adjusted Bollinger Bands (VABB) indicator is provided for educational and informational purposes only. It is not financial advice and should not be construed as a recommendation to buy, sell, or hold any financial instrument. Trading involves significant risk of loss and is not suitable for all investors. Past performance is not indicative of future results.
ADX with Donchian Channels
The "ADX with Donchian Channels" indicator combines the Average Directional Index (ADX) with Donchian Channels to provide traders with a powerful tool for identifying trends and potential breakouts.
Features:
Average Directional Index (ADX):
The ADX is used to quantify the strength of a trend. It helps traders determine whether a market is trending or ranging.
Adjustable parameters for ADX smoothing and DI length allow traders to fine-tune the sensitivity of the trend strength measurement.
Donchian Channels on ADX:
Donchian Channels are applied directly to the ADX values to highlight the highest high and lowest low of the ADX over a specified period.
The upper and lower Donchian Channels can signal potential trend breakouts when the ADX value moves outside these bounds.
The middle Donchian Channel provides a reference for the average trend strength.
Visualization:
The indicator plots the ADX line in red to clearly display the trend strength.
The upper and lower Donchian Channels are plotted in blue, with a green middle line to represent the average.
The area between the upper and lower Donchian Channels is filled with a blue shade to visually emphasize the range of ADX values.
Default Settings for Scalping:
Donchian Channel Length: 10
Standard Deviation Multiplier: 1.58
ADX Length: 2
ADX Smoothing Length: 2
These default settings are optimized for scalping, offering a quick response to changes in trend strength and potential breakout signals. However, traders can adjust these settings to suit different trading styles and market conditions.
How to Use:
Trend Strength Identification: Use the ADX line to identify the strength of the current trend. Higher ADX values indicate stronger trends.
Breakout Signals: Monitor the ADX value in relation to the Donchian Channels. A breakout above the upper channel or below the lower channel can signal a potential trend continuation or reversal.
Range Identification: The filled area between the Donchian Channels provides a visual representation of the ADX range, helping traders identify when the market is ranging or trending.
This indicator is designed to enhance your trading strategy by combining trend strength measurement with breakout signals, making it a versatile tool for various market conditions.
[MAD] Custom Session VWAP BandsOverview
This indicator helps visualize the Volume Weighted Average Price (VWAP) and its associated standard deviation bands over specified time periods, providing traders with a clear understanding of price trends, volatility, and potential support/resistance levels.
Inputs
Deviation
StDev mult 1: Multiplier for the first standard deviation band (Default: 1.0)
StDev mult 2: Multiplier for the second standard deviation band (Default: 2.0)
StDev mult 3: Multiplier for the third standard deviation band (Default: 3.0)
StDev mult 4: Multiplier for the fourth standard deviation band (Default: 4.0)
Line width: Width of the lines for the bands (Default: 2)
Custom Vwap session reset settings
Many different options are considered when a session is going to be reset.
Plot and Fill Options
Enable Fills: Enable/disable filling between bands.
Plot +4: Enable/disable plotting the +4 standard deviation band.
Plot +3: Enable/disable plotting the +3 standard deviation band.
Plot +2: Enable/disable plotting the +2 standard deviation band.
Plot +1: Enable/disable plotting the +1 standard deviation band.
Plot VWAP: Enable/disable plotting the VWAP line.
Plot -1: Enable/disable plotting the -1 standard deviation band.
Plot -2: Enable/disable plotting the -2 standard deviation band.
Plot -3: Enable/disable plotting the -3 standard deviation band.
Plot -4: Enable/disable plotting the -4 standard deviation band.
How to Use the Indicator
Adding the Indicator
Add the indicator to your chart through your trading platform's indicator menu.
Configuring the VWAP Reset
Specify reset intervals based on time, days of the week, or specific dates.
Adjust the time zone if necessary.
Customizing Standard Deviation Bands
Set the multipliers for the standard deviation bands.
Choose line width for better visualization.
Enabling Plots and Fills
Select which bands to display.
Enable or disable fills between the bands.
Practical Application of VWAP Bands
Understanding VWAP
VWAP is a trading benchmark that calculates the average price a security has traded at throughout the day based on volume and price. It is primarily used for intraday trading but can also offer insights during end-of-day reviews.
Using VWAP for Trading
Intraday Trading
Entry and Exit Points: VWAP can help identify optimal buy and sell points. Buy when the price is above VWAP and sell when it's below.
Support and Resistance: VWAP often acts as a dynamic support/resistance level. Prices tend to revert to VWAP, making it a crucial level for intraday traders.
Trend Confirmation
Uptrends and Downtrends: In an uptrend, the price will generally stay above VWAP. Conversely, in a downtrend, it will stay below. Use this to confirm market direction.
Combining with Other Indicators
Moving Averages and Bollinger Bands: Combining VWAP with these indicators can provide a more robust trading signal, confirming trends and potential reversals.
Setting Stop-Loss and Profit Targets
Conservative Stop Orders: Place stop orders at recent lows for pullback trades.
Profit Targets: Use daily highs or Fibonacci extension levels to set profit targets.
Strategies for Using VWAP
Pullback Strategy
Buy during pullbacks to VWAP in an uptrend, and sell during rallies to VWAP in a downtrend.
Breakout Strategy
Look for breakouts above/below VWAP after the market open to capitalize on new trends.
Momentum Trading
Use VWAP to confirm the strength of a trend. Buy when the price is consistently above VWAP and sell when it's consistently below.
Institutional Strategies
Institutional traders use VWAP to execute large orders without causing significant market impact, ensuring trades are made around the average price.
By incorporating these strategies, traders can better understand market dynamics, make informed trading decisions, and manage their risk effectively.
Some setup possibilities
KillZones + ACD Fisher [TradingFinder] Sessions + Reversal Level🔵 Introduction
🟣 ACD Method
"The Logical Trader" opens with a thorough exploration of the ACD Methodology, which focuses on pinpointing particular price levels associated with the opening range.
This approach enables traders to establish reference points for their trades, using "A" and "C" points as entry markers. Additionally, the book covers the concept of the "Pivot Range" and how integrating it with the ACD method can help maximize position size while minimizing risk.
🟣 Session
The forex market is operational 24 hours a day, five days a week, closing only on Saturdays and Sundays. Typically, traders prefer to concentrate on one specific forex trading session rather than attempting to trade around the clock.
Trading sessions are defined time periods when a particular financial market is active, allowing for the execution of trades.
The most crucial trading sessions within the 24-hour cycle are the Asia, London, and New York sessions, as these are when substantial money flows and liquidity enter the market.
🟣 Kill Zone
Traders in financial markets earn profits by capitalizing on the difference between their buy/sell prices and the prevailing market prices.
Traders vary in their trading timelines.Some traders engage in daily or even hourly trading, necessitating activity during periods with optimal trading volumes and notable price movements.
Kill zones refer to parts of a session characterized by higher trading volumes and increased price volatility compared to the rest of the session.
🔵 How to Use
🟣 Session Times
The "Asia Session" comprises two parts: "Sydney" and "Tokyo." This session begins at 23:00 and ends at 06:00 UTC. The "Asia KillZone" starts at 23:00 and ends at 03:55 UTC.
The "London Session" includes "Frankfurt" and "London," starting at 07:00 and ending at 14:25 UTC. The "London KillZone" runs from 07:00 to 09:55 UTC.
The "New York" session starts at 14:30 and ends at 19:25 UTC, with the "New York am KillZone" beginning at 14:30 and ending at 22:55 UTC.
🟣 ACD Methodology
The ACD strategy is versatile, applicable to various markets such as stocks, commodities, and forex, providing clear buy and sell signals to set price targets and stop losses.
This strategy operates on the premise that the opening range of trades holds statistical significance daily, suggesting that initial market movements impact the market's behavior throughout the day.
Known as a breakout strategy, the ACD method thrives in volatile or strongly trending markets like crude oil and stocks.
Some key rules for employing the ACD strategy include :
Utilize points A and C as critical reference points, continually monitoring these during trades as they act as entry and exit markers.
Analyze daily and multi-day pivot ranges to understand market trends. Prices above the pivots indicate an upward trend, while prices below signal a downward trend.
In forex trading, the ACD strategy can be implemented using the ACD indicator, a technical tool that gauges the market's supply and demand balance. By evaluating trading volume and price, this indicator assists traders in identifying trend strength and optimal entry and exit points.
To effectively use the ACD indicator, consider the following :
Identifying robust trends: The ACD indicator can help pinpoint strong, consistent market trends.
Determining entry and exit points: ACD generates buy and sell signals to optimize trade timing.
Bullish Setup :
When the "A up" line is breached, it’s wise to wait briefly to confirm it’s not a "Fake Breakout" and that the price stabilizes above this line.
Upon entering the trade, the most effective stop loss is positioned below the "A down" line. It's advisable to backtest this to ensure the best outcomes. The recommended reward-to-risk ratio for this strategy is 1, which should also be verified through backtesting.
Bearish Setup :
When the "A down" line is breached, it’s prudent to wait briefly to ensure it’s not a "Fake Breakout" and that the price stabilizes below this line.
Upon entering the trade, the most effective stop loss is positioned above the "A up" line. Backtesting is recommended to confirm the best results. The recommended reward-to-risk ratio for this strategy is 1, which should also be validated through backtesting.
Advantages of Combining Kill Zone and ACD Method in Market Analysis :
Precise Trade Timing : Integrating the Kill Zone strategy with the ACD Method enhances precision in trade entries and exits. The ACD Method identifies key points for trading, while the Kill Zone focuses on high-activity periods, together ensuring optimal timing for trades.
Better Trend Identification : The ACD Method’s pivot ranges help spot market trends, and when combined with the Kill Zone’s emphasis on periods of significant price movement, traders can more effectively identify and follow strong market trends.
Maximized Profits and Minimized Risks : The ACD Method's structured approach to setting price targets and stop losses, coupled with the Kill Zone's high-volume trading periods, helps maximize profit potential while reducing risk.
Robust Risk Management : Combining these methods provides a comprehensive risk management strategy, strategically placing stop losses and protecting capital during volatile periods.
Versatility Across Markets : Both methods are applicable to various markets, including stocks, commodities, and forex, offering flexibility and adaptability in different trading environments.
Enhanced Confidence : Using the combined insights of the Kill Zone and ACD Method, traders gain confidence in their decision-making process, reducing emotional trading and improving consistency.
By merging the Kill Zone’s focus on trading volumes and the ACD Method’s structured breakout strategy, traders benefit from a synergistic approach that enhances precision, trend identification, and risk management across multiple markets.
Scalping System by Machine# Custom Trading System Indicator
This Pine Script indicator is designed to identify potential trading setups based on a specific set of rules. It's intended for use on lower timeframes (M1-M5) in the forex market, particularly during the New York-London overlap period.
## Key Features
1. **EMA Condition**: Uses a 20-period Exponential Moving Average (EMA) to determine trend direction.
2. **Candle Analysis**: Identifies strong bars and candle color changes.
3. **Volume Confirmation**: Checks for increasing volume.
4. **Volatility Filter**: Utilizes the Average True Range (ATR) to gauge market volatility.
5. **Time-based Filter**: Highlights the New York-London overlap period.
6. **Visual Aids**: Plots potential entry points, stop losses, and take profit levels.
## Trading Rules
1. **Buy Signal**:
- Price is above the 20 EMA
- Candle color changes from red to green
- Current candle is a strong bar (closing within 75% of its range)
- Volume is higher than the previous bar
- ATR(14) is above 4 pips OR it's during the NY-London overlap
2. **Sell Signal**:
- Price is below the 20 EMA
- Candle color changes from green to red
- Current candle is a strong bar (closing within 75% of its range)
- Volume is higher than the previous bar
- ATR(14) is above 4 pips OR it's during the NY-London overlap
3. **Stop Loss**: Placed near the low of the setup candle for buys, or near the high for sells.
4. **Take Profit**: Aimed at 1R (one times the range of the setup candle).
## Visual Elements
- **20 EMA**: Plotted as a blue line on the chart.
- **Buy Signals**: Green triangles below the candles.
- **Sell Signals**: Red triangles above the candles.
- **Stop Loss Levels**: Small red dots at the calculated stop loss prices.
- **Take Profit Levels**: Small green dots at the calculated take profit prices.
- **Information Table**: Displays current values for ATR, strong bar condition and volume condition.
## Usage Notes
1. This indicator is designed for manual trading, not automated execution.
2. It works best when combined with analysis of major trend lines, support, and resistance levels.
3. Exercise caution with very large setup candles.
4. Consider additional filters or money management rules for enhanced performance.
5. For higher timeframe bias validation, consider incorporating a 100-period break of structure (BOS) analysis.
## Customization
The indicator includes several input parameters that can be adjusted:
- EMA Length
- ATR Length and Threshold
- Volume Multiplier
- Strong Bar Percentage
Users can also toggle the visibility of stop loss and take profit markers.
Remember, while this indicator can identify potential setups, it should be used in conjunction with other forms of analysis and risk management strategies. Always consider the overall market context and your personal risk tolerance when making trading decisions.
