I already shared a method to estimate tops and bottoms (1), the number of parameters could lead to optimization issues so i tried to make a simpler method. In this method i use a simple rescaling method based on individual direction deviation. I will explain further details below.
The Indicator
I use as source for the entire calculation an exponential moving average, the first reaction to this choice would be to think that i wanted to filter signals in order to reduce them, but the truth is that i wanted to have more signals instead, this is because the first calculations involving standard deviations are based on price direction, so by using a smooth input we can get more persistent values in a and b, but its totally up to you to use whatever you want in a, just take into account that less smooth = less signals, this is why i used this calculation process.
a = close and length = 7
a = least squares moving average and length = 25
So you could use pretty much everything you want as input.
Conclusion
The accuracy of such indicators is still relatively low but i presented a way to estimate tops and bottoms without using highest/lowest or differencing thus creating a totally new approach. I encourage you to experiment with it and share your results. If you learned something with this post then i'am happy :)
Notes
Based on several complaints i will have to leave even sooner, i think the 7 of June will be a good day, so if you need something i encourage you to ask me now. With the hope you can understand.
Several complaints??? Who the hack complaints =(
I feel so angry about those people....
alexgrover
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@ICEKI, mostly friend and family, but don't worry about it, i still have plenty of time to do stuff, i hope you liked the indicator :)
WoodLandSprite
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Can I use this in BTCUSD?
alexgrover
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@WoodLandSprite, Hi, to respond to your 2 comments : Yes you can use on BTCUSD, and no this indicator does not repaint :)
wrowalter
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Good morning. Great job !!!! I would like to kindly suggest that you take a closer look at depth multiple time frame, momentum divergenze, macd+rsi+flag, dmi histogram, cyclic rsi, jeffrey owen cyclical, banker entry, banker fund, MTF rsi . If you could take all the best out of those mentioned indicators you would be rich as king Solomon. Too bad I do not have the skills ... ! Maybe it is you ?
wrowalter
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Good morning ! I noticed it may show not so accurately near the moving averages. I suggest you to take a deep look into depth multiple time frame indicator and try to find a combination. Take care !
scamArtist
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thank you kind for your great work, @alexgrover will look to tweak little bit this code by adding some more filters as conditions for its accuracy, it works like this too very well but will take it as part of my educational line in this beautiful game of knowledge called trading, simple and effective algo too :)
alexgrover
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@scamArtist, Thx for the support, feel free to add conditions and filters.