TrendingNowTrendingNow Indicator - An Experimental Study
Introduction:
The TrendingNow indicator is an experimental study designed to identify trending market conditions and potential trading opportunities. It combines various technical analysis tools and parameters to provide insights into trend direction, momentum, volume, and price reversals.
Methodology:
The TrendingNow indicator is calculated based on the following parameters and calculations:
Moving Average: A simple moving average (SMA) is calculated using the specified length parameter. It helps smooth out price fluctuations and identify the overall trend direction.
Upper and Lower Bands: The upper and lower bands are derived from the moving average by adding and subtracting a deviation calculated using the multiplier parameter. These bands provide dynamic levels for potential trend reversals.
Price Reversals: The indicator detects price reversals by identifying when the price crosses above or below the upper or lower bands. These reversals suggest potential entry or exit points in the market.
Trend Confirmation: The indicator uses a moving average of the closing prices over the confirmation length parameter to confirm the overall trend direction. It helps filter out false signals and validates the presence of a trend.
Momentum Oscillator: The indicator calculates the relative strength index (RSI) over the momentum length parameter. The RSI measures the speed and change of price movements, indicating potential overbought and oversold conditions.
Volume Trend Confirmation: The study compares the current volume with the average volume over the specified length. If the current volume is above the volume threshold, it suggests increasing volume activity and potential confirmation of the trend.
Volatility Filter: The indicator incorporates an average true range (ATR) calculation to assess market volatility. The volatility threshold is derived by multiplying the ATR by the volatility multiplier parameter. It helps filter out signals during periods of low volatility.
Experimental Study:
The TrendingNow indicator aims to experiment with the combination of these technical analysis tools to identify trending market conditions and potential trading opportunities. By monitoring the price reversals, trend confirmation, momentum, volume trends, and volatility, traders can potentially identify high-probability trade setups.
The study involves observing the indicator's signals and assessing their effectiveness in different market conditions. Traders can experiment with different parameter values, timeframes, and asset classes to optimize the indicator's performance.
Usage and Interpretation:
When using the TrendingNow indicator, traders can consider the following guidelines:
Trend Identification: A bullish trend is indicated when the price is above the upper band, the moving average is rising, and the trend confirmation is positive. A bearish trend is indicated when the price is below the lower band, the moving average is declining, and the trend confirmation is negative.
Price Reversals: Price crossing above the upper band may suggest a potential selling opportunity, while price crossing below the lower band may indicate a potential buying opportunity. These reversals should be confirmed by other indicators and market conditions.
Momentum and Volume Confirmation: Traders can pay attention to the RSI levels to assess overbought and oversold conditions. High volume activity in line with the trend can provide additional confirmation.
Volatility Consideration: Traders may choose to adjust the volatility multiplier parameter based on the current market conditions. Higher values may be more suitable during periods of higher volatility, while lower values may be preferred during low volatility.
Conclusion:
The TrendingNow indicator offers an experimental approach to identifying trending market conditions and potential trading opportunities. Traders can customize the indicator parameters and combine it with other analysis techniques to suit their trading strategies. It is important to conduct thorough testing and validation before incorporating the indicator into live trading.
Disclaimer:
The information provided in this document, including the TrendingNow indicator and the accompanying experimental study, is for educational and experimental purposes only. It should not be considered as financial advice or a recommendation to engage in any trading or investment activities. Trading and investing in financial markets carry inherent risks, and past performance is not indicative of future results.
Before making any trading decisions, it is essential to conduct your own research, evaluate your risk tolerance, and consider your financial situation. The TrendingNow indicator is based on historical price data and technical analysis tools. However, it is important to understand that market conditions can change rapidly, and the indicator may not accurately predict future market movements or generate profitable trades in all situations.
The experimental study aims to explore the effectiveness of the TrendingNow indicator under different market conditions. However, the results obtained from the study are specific to historical data and may not necessarily be indicative of real-time market performance. It is recommended to exercise caution and use the indicator in conjunction with other analysis techniques and risk management strategies.
The TrendingNow indicator's parameters, such as length, multiplier, confirmation length, momentum length, overbought level, oversold level, volume threshold, and volatility multiplier, are adjustable inputs. Traders should carefully consider and test different parameter settings to suit their trading style and market conditions. Furthermore, it is important to regularly review and update the indicator's parameters as market dynamics change.
Trading in financial markets involves the potential for financial loss, and individuals should only trade with funds they can afford to lose. It is strongly advised to seek the guidance of a qualified financial professional or advisor before making any investment decisions.
By using the TrendingNow indicator and conducting the experimental study, you acknowledge that you are solely responsible for any trading decisions you make, and you agree to hold harmless the authors, developers, and distributors of this indicator for any losses, damages, or liabilities incurred as a result of your trading activities.
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Opening Score with DivergenceOverview
The Opening Score Indicator is a versatile tool designed to help traders assess market sentiment, trend direction, and potential reversals. By combining Opening Range Breakout (ORB), VWAP, Trend, Volatility, and Divergence Detection, this indicator provides a composite score that adapts to different market conditions.
This version includes divergence detection between the Opening Score and price, which highlights potential trend reversals or continuations before they happen. When a regular divergence occurs, the histogram bar turns orange, signaling an increased probability of a trend change.
Best for Both Intraday & Longer-Term Charts
📊 Optimized for intraday trading → Works well on 1m to 30m timeframes for short-term strategies.
📈 Also effective on longer-term charts → Can be used on 1-hour, 4-hour, daily, or weekly charts to identify macro trends and momentum shifts.
🕰️ Adapts to different market conditions → Whether you’re a day trader, swing trader, or position trader, the Opening Score helps you track trend health and reversals.
How It Works
📊 Composite Opening Score Calculation
• ORB Signal → Detects bullish/bearish breakouts based on the opening range.
• VWAP Signal → Measures price positioning relative to VWAP for trend confirmation.
• Trend Signal → Uses a moving average to determine market direction.
• Volatility Signal → Tracks ATR changes to assess market strength.
• Divergence Detection → Identifies regular and hidden divergences for potential reversals or trend continuation.
🔹 Reversal Alerts with Color-Coded Histogram
• Green Bars → Normal bullish Opening Score.
• Red Bars → Normal bearish Opening Score.
• Orange Bars → Warning! Regular Divergence detected → Possible trend reversal.
🔹 Hidden & Regular Divergence Detection
• Regular Divergence (Reversal Signals)
• 📉 Bearish Regular Divergence → Price makes a Higher High, but Opening Score makes a Lower High → 🔻 Possible Downtrend Reversal.
• 📈 Bullish Regular Divergence → Price makes a Lower Low, but Opening Score makes a Higher Low → 🔼 Possible Uptrend Reversal.
• Hidden Divergence (Trend Continuation Signals)
• 📉 Bearish Hidden Divergence → Price makes a Lower High, but Opening Score makes a Higher High → 🔻 Trend Likely to Continue Down.
• 📈 Bullish Hidden Divergence → Price makes a Higher Low, but Opening Score makes a Lower Low → 🔼 Trend Likely to Continue Up.
How to Use It
✅ Watch for Reversal Alerts (Orange Bars) → These highlight potential market turning points.
✅ Use the Zero Line as a Trend Filter → A score above 0 suggests bullish conditions, while below 0 signals bearish conditions.
✅ Combine with Market Structure & Volume Profile → Works well when paired with support/resistance levels, liquidity zones, and order flow data.
✅ Adjust settings based on timeframe → Increase moving average length & lookback periods for longer-term analysis.
Why Use This Indicator?
🚀 Works for both short-term and long-term traders → Adapts to intraday and higher timeframes.
📊 Multi-Factor Analysis → Combines multiple key market indicators for better accuracy.
🎯 Customizable Weighting → Adjust the influence of each signal to suit your trading style.
✅ No Clutter – Only the Opening Score is plotted → Keeps your chart clean & efficient.
🔔 Recommended for Intraday Trading (1m – 30m) AND Longer-Term Analysis (1H – Weekly) → Use this indicator to enhance your trend detection & reversal strategy! 🚀
Bollinger Bands + RSI [Uncle Sam Trading]The Bollinger Bands + RSI indicator combines two popular technical analysis tools, Bollinger Bands (BB) and the Relative Strength Index (RSI), into a unified framework designed to assess both market volatility and momentum. This indicator provides both visual signals on the chart, and allows you to set alerts. It is intended to help traders identify potential overbought/oversold conditions, trend reversals, and to refine trade entry and exit points.
Key Features:
Bollinger Bands: The indicator plots Bollinger Bands, which consist of a basis line (typically a 20-period Simple Moving Average), an upper band (basis + 2 standard deviations), and a lower band (basis - 2 standard deviations). The bands dynamically adjust to market volatility, widening during periods of increased volatility and contracting during periods of decreased volatility.
Relative Strength Index (RSI): The RSI, a momentum oscillator, is plotted in a separate pane below the price chart. It measures the magnitude of recent price changes to evaluate overbought or oversold conditions in the price of a stock or other asset. Traditional interpretation uses 70 and 30 as overbought and oversold levels, respectively.
Overbought/Oversold Zones Highlighting: This indicator uniquely highlights overbought and oversold zones directly on the price chart based on the RSI values. When the RSI is above the overbought level (default 70), a red-shaded area is displayed. When the RSI is below the oversold level (default 30), a green-shaded area is displayed. These visual cues enhance the identification of potential trend reversals.
Buy and Sell Signals: The indicator generates buy signals when the price crosses above the lower Bollinger Band and the RSI is below the oversold level (if the RSI filter is enabled). Sell signals are generated when the price crosses below the upper Bollinger Band and the RSI is above the overbought level (if the RSI filter is enabled). These signals are plotted as green upward-pointing triangles (buy) and red downward-pointing triangles (sell) on the chart.
Customizable Parameters: Users can adjust various settings, including:
Bollinger Bands Length: The number of periods used to calculate the moving average and standard deviation.
Bollinger Bands Standard Deviation: The multiplier used to determine the distance of the upper and lower bands from the basis.
RSI Length: The number of periods used to calculate the RSI.
RSI Overbought/Oversold Levels: The threshold values that define overbought and oversold conditions for the RSI.
Use RSI Filter for Signals: Enable/disable the RSI filter for buy and sell signals.
Colors: The colors of the Bollinger Bands, RSI, overbought/oversold levels, and zone highlights can be customized to suit user preferences.
Alerts: The indicator supports customizable alerts for various conditions, including:
Buy Signal: Triggered when a buy signal is generated.
Sell Signal: Triggered when a sell signal is generated.
Price Crossed Upper BB: Triggered when the price crosses above the upper Bollinger Band.
Price Crossed Lower BB: Triggered when the price crosses below the lower Bollinger Band.
RSI Overbought: Triggered when the RSI crosses above the overbought level.
RSI Oversold: Triggered when the RSI crosses below the oversold level.
How to Use:
The Bollinger Bands + RSI indicator can be used in various ways, including:
Identifying Potential Trend Reversals: Price crosses above the lower band coupled with an oversold RSI (and highlighted zone) may signal a bullish reversal. Conversely, a price cross below the upper band with an overbought RSI (and highlighted zone) may indicate a bearish reversal.
Confirming Trend Strength: In an uptrend, the price may "ride" the upper band, while in a downtrend, it may "ride" the lower band.
Exit Signals: Crossing the opposite band while in a trade, particularly with confirming RSI signals, is often used to identify potential exit points.
Combined with Other Analysis: This indicator works well in conjunction with other technical analysis tools, such as trend lines, support/resistance levels, chart patterns, and moving average-based strategies.
Disclaimer:
This indicator is for educational and informational purposes only and should not be considered as financial advice. Trading involves risk, and past performance is not indicative of future results. Always conduct thorough research and consider your risk tolerance before making any trading decisions.
Custom Moving Average Ribbon with EMA Table & Text ColorComprehensive Description of the Custom Moving Average Ribbon with EMA Table & Text Color
The Custom Moving Average Ribbon with EMA Table & Text Color is a highly flexible and customizable indicator designed for traders who use multiple moving averages to assess trends, strength, and potential market reversals. It plots up to 8 moving averages (either SMA, EMA, WMA, or VWMA) on the price chart and displays a table summarizing the moving averages’ values, periods, and colors. The table also allows for the customization of the text color, making it easier to align with your chart’s theme or preference.
Key Features:
Multiple Moving Averages: You can display up to 8 moving averages (MA), each of which can be customized in terms of:
Type: SMA (Simple Moving Average), EMA (Exponential Moving Average), WMA (Weighted Moving Average), or VWMA (Volume-Weighted Moving Average).
Period: Each moving average has a user-defined period, which allows for flexibility depending on your trading style (short-term, medium-term, or long-term).
Enable/Disable: Each moving average can be independently enabled or disabled based on your preference.
Moving Average Ribbon: The indicator visualizes multiple moving averages as a ribbon, giving traders insight into the market's underlying trend. The interaction between these moving averages provides essential signals:
Uptrend: Shorter-term MAs above longer-term MAs, all sloping upward.
Downtrend: Shorter-term MAs below longer-term MAs, sloping downward.
Consolidation: MAs tightly packed, indicating low volatility or a sideways market.
Customizable Table: The indicator includes a table that displays:
The Name of each moving average (e.g., MA 1, MA 2, etc.).
The Period used for each moving average.
The Current Value of each moving average.
Color Coding for easier visual identification on the chart.
Text Color Customization: You can change the text color in the table to match your chart style or to ensure high visibility.
Responsive Design: This indicator works on any time frame, whether you're a day trader, swing trader, or long-term investor, and the table adjusts dynamically as new data comes in.
How to Use the Indicator
a) Trend Identification
The Custom Moving Average Ribbon helps in identifying trends and their strength. Here’s how you can interpret the plotted moving averages:
Uptrend (Bullish):
If the shorter-term moving averages (e.g., 5-period, 10-period) are above the longer-term moving averages (e.g., 50-period, 200-period), and all the MAs are sloping upward, it suggests a strong bullish trend.
The greater the separation between the moving averages, the stronger the uptrend.
Use the table to quickly verify the current value of each MA and confirm that the price is staying above most or all of the MAs.
Downtrend (Bearish):
When shorter-term moving averages are below the longer-term moving averages and all MAs are sloping downward, this indicates a bearish trend.
Greater separation between MAs indicates a stronger downtrend.
Neutral/Consolidating Market:
If the MAs are tightly packed and frequently crossing each other, the market is likely consolidating, and a strong trend is not in play.
In these situations, it’s better to wait for a clearer signal before taking any positions.
b) Reversal Signals
Golden Cross: When a short-term moving average (e.g., 50-period) crosses above a long-term moving average (e.g., 200-period), this is considered a bullish signal, suggesting a possible upward trend.
Death Cross: When a short-term moving average crosses below a long-term moving average, it’s considered a bearish signal, indicating a potential downward trend.
c) Using the Table for Quick Reference
The table allows you to monitor:
The current price value relative to each moving average. If the price is above most MAs, the market is likely in an uptrend, and if below, in a downtrend.
Changes in MA values: If you see values of shorter-term MAs moving closer to or crossing longer-term MAs, this could indicate a weakening trend or a potential reversal.
How to Combine this Indicator with Other Indicators for a Solid Strategy
The Custom Moving Average Ribbon is powerful on its own but can be enhanced when combined with other technical indicators to form a comprehensive trading strategy.
1. Combining with RSI (Relative Strength Index)
How It Works: RSI is a momentum oscillator that measures the speed and change of price movements, typically over 14 periods. It ranges from 0 to 100, with readings above 70 considered overbought and below 30 considered oversold.
Strategy:
Overbought in an Uptrend: If the moving average ribbon indicates an uptrend but the RSI shows the market is overbought (RSI > 70), it could signal a pullback or correction is imminent.
Oversold in a Downtrend: If the moving average ribbon indicates a downtrend but the RSI shows oversold conditions (RSI < 30), a bounce or reversal may be on the horizon.
2. Combining with MACD (Moving Average Convergence Divergence)
How It Works: MACD tracks the difference between two exponential moving averages, typically the 12-period and 26-period EMAs. It generates buy and sell signals based on crossovers and divergences.
Strategy:
Trend Confirmation: Use the MACD to confirm the direction and momentum of the trend indicated by the moving average ribbon. For example, if the MACD line crosses above the signal line while the shorter-term MAs are above the longer-term MAs, it confirms strong bullish momentum.
Divergences: Watch for divergences between price action and MACD. If price is making higher highs but MACD is making lower highs, it could signal a weakening trend, which you can verify using the moving averages.
3. Combining with Bollinger Bands
How It Works: Bollinger Bands plot two standard deviations above and below a moving average, typically the 20-period SMA. The bands widen during periods of high volatility and contract during periods of low volatility.
Strategy:
Breakout or Reversal: If price action moves above the upper Bollinger Band while the shorter-term MAs are crossing above the longer-term MAs, it confirms a strong breakout. Conversely, if price touches or falls below the lower Bollinger Band and the shorter MAs start crossing below the longer-term MAs, it indicates a potential breakdown.
Mean Reversion: In sideways markets, when the moving averages are tightly packed, Bollinger Bands can help spot mean reversion opportunities (buy near the lower band, sell near the upper band).
4. Combining with Volume Indicators
How It Works: Volume is a crucial confirmation indicator for any trend or breakout. Combining volume with the moving average ribbon can enhance your strategy.
Strategy:
Trend Confirmation: If the price breaks above the moving averages and is accompanied by high volume, it confirms a strong breakout. Similarly, if price breaks below the moving averages on high volume, it signals a strong downtrend.
Divergence: If price continues to trend in one direction but volume decreases, it could indicate a weakening trend, helping you prepare for a reversal.
Example Strategies Using the Indicator
Trend-Following Strategy:
Use the moving average ribbon to identify the main trend.
Combine with MACD or RSI for confirmation of momentum.
Enter trades when the shorter-term MAs confirm the trend and the confirmation indicator (MACD or RSI) aligns with the trend.
Exit trades when the moving averages start converging or when your confirmation indicator shows signs of reversal.
Reversal Strategy:
Wait for significant crossovers in the moving averages (Golden Cross or Death Cross).
Confirm the reversal with divergence in MACD or RSI.
Use Bollinger Bands to fine-tune your entry and exit points based on overbought/oversold conditions.
Conclusion
The Custom Moving Average Ribbon with EMA Table & Text Color indicator provides a robust framework for traders looking to use multiple moving averages to gauge trend direction, strength, and potential reversals. By combining it with other technical indicators like RSI, MACD, Bollinger Bands, and volume, you can develop a solid trading strategy that enhances accuracy, reduces false signals, and maximizes profit potential in various market conditions.
This indicator offers high flexibility with customization options, making it suitable for traders of all levels and strategies. Whether you're trend-following, scalping, or swing trading, this tool provides invaluable insights into market movements.
Market Structure Trailing Stop [BigBeluga]The Market Structure Trailing Stop indicator is an advanced tool for identifying market structure shifts, liquidity sweeps, and potential trend reversals using comprehensive volume analysis. This indicator combines the analysis of market structure pivots (CHoCH - Change of Character) with a sophisticated volume-based trailing stop logic. By evaluating delta volume at key structural points, it allows traders to identify high-probability trend continuations or reversals and manage their trades more effectively.
🔵 KEY FEATURES
● Market Structure Analysis
Pivot-Based Market Structure : The indicator identifies high and lows using user-defined periods, allowing traders to spot key market structure shifts.
Change of Character (CHoCH) : The first significant break of a market structure is marked as a CHoCH, indicating a potential trend reversal.
Break of Structure (BoS) : The indicator highlights subsequent breaks of structure after CHoCH, providing traders with crucial insights into trend strength.
● Advanced Volume Analysis
Delta Volume Evaluation : The indicator calculates delta volume (difference between up and down volume) at each ChoCh or BoS market structure point to assess the strength of the move. Identify Delta Volume from break point back to Pivot
● Trailing Stop Logic
Volume-Validated Trailing Stop : The indicator automatically plots a trailing stop if the delta volume at the UP CHoCH is positive and above the defined threshold and vice versa for Down CHoCH , allowing traders to protect their profits while riding the trend.
Trend Weakness Detection : If a subsequent BoS occurs with negative delta volume or lower volume than the input threshold, the trailing stop disappears, indicating potential trend exhaustion or reversal.
Dynamic Stop Placement : The trailing stop is dynamically adjusted based on market structure and volume, providing traders with a more adaptive stop-loss strategy.
Up Trend Trailing Stop:
Down Trend Trailing Stop:
● Liquidity Sweep Detection
Liquidity Sweep (X) Labels : The indicator identifies liquidity sweeps—points where the price temporarily reverses to sweep liquidity above or below a key level—marked with an “X” label.
Potential Reversal Zones : These liquidity sweeps are potential reversal zones, especially when accompanied by significant delta volume changes, providing traders with early warnings of potential trend reversals.
🔵 HOW TO USE
● Identifying Market Structure Shifts
Change of Character (CHoCH) : When a CHoCH occurs, the indicator calculates the total volume from the high point to the break point. If the delta volume is positive and exceeds the input threshold, a trailing stop is plotted, signaling potential trend continuation.
Break of Structure (BoS) : If BoS is enabled, subsequent breaks of structure are highlighted. If these BoS points show weaker volume or negative delta volume, the trailing stop will disappear, indicating that the trend may be losing strength.
● Using the Trailing Stop Feature
Protecting Profits : Once a CHoCH occurs and the delta volume validates the trend, the trailing stop will be plotted below (or above) the price to protect profits while allowing the trend to run.
Trend Reversal Signals : If the trailing stop disappears due to weak volume at subsequent BoS points, it may signal that the trend is losing momentum, and traders may consider closing their positions or tightening their stops manually.
● Liquidity Sweep Interpretation
Spotting Reversal Zones : Liquidity sweeps, marked with an “X” label, indicate zones where the price has swept liquidity. These areas can serve as potential reversal zones, especially when significant delta volume is observed at these points.
Early Reversal Warnings : Traders can use these liquidity sweep labels as early warnings for potential trend reversals, particularly in conjunction with other technical analysis methods.
🔵 CUSTOMIZATION
Highs and Lows Calculation : Customize the number of bars to the left and right for identifying pivots and market structure shifts.
Volume Threshold : Define the volume threshold to filter out weaker moves and focus on significant market structure shifts.
BoS and Liquidity Sweep Labels : Toggle on or off the BoS and Liquidity Sweep labels to tailor the indicator to your trading style.
Trend Color : Enable or disable trend coloring for candles to visually highlight uptrends and downtrends on the chart.
🔵 CONCLUSION
The Market Structure Trailing Stop indicator combines advanced volume analysis with market structure detection to provide traders with a powerful tool for identifying and managing trends. By leveraging delta volume at key structure points, it helps traders validate trend strength and manage their positions with a dynamic trailing stop strategy. The addition of liquidity sweep detection further enhances its utility, offering early warnings of potential trend reversals. This indicator is ideal for traders who want to gain a deeper understanding of market structure while incorporating volume-based insights into their trading strategies.
Bifurcation Zone - CAEBifurcation Zone — Cognitive Adversarial Engine (BZ-CAE)
Bifurcation Zone — CAE (BZ-CAE) is a next-generation divergence detection system enhanced by a Cognitive Adversarial Engine that evaluates both sides of every potential trade before presenting signals. Unlike traditional divergence indicators that show every price-oscillator disagreement regardless of context, BZ-CAE applies comprehensive market-state intelligence to identify only the divergences that occur in favorable conditions with genuine probability edges.
The system identifies structural bifurcation points — critical junctures where price and momentum disagree, signaling potential reversals or continuations — then validates these opportunities through five interconnected intelligence layers: Trend Conviction Scoring , Directional Momentum Alignment , Multi-Factor Exhaustion Modeling , Adversarial Validation , and Confidence Scoring . The result is a selective, context-aware signal system that filters noise and highlights high-probability setups.
This is not a "buy the arrow" indicator. It's a decision support framework that teaches you how to read market state, evaluate divergence quality, and make informed trading decisions based on quantified intelligence rather than hope.
What Sets BZ-CAE Apart: Technical Architecture
The Problem With Traditional Divergence Indicators
Most divergence indicators operate on a simple rule: if price makes a higher high and RSI makes a lower high, show a bearish signal. If price makes a lower low and RSI makes a higher low, show a bullish signal. This creates several critical problems:
Context Blindness : They show counter-trend signals in powerful trends that rarely reverse, leading to repeated losses as you fade momentum.
Signal Spam : Every minor price-oscillator disagreement generates an alert, overwhelming you with low-quality setups and creating analysis paralysis.
No Quality Ranking : All signals are treated identically. A marginal divergence in choppy conditions receives the same visual treatment as a high-conviction setup at a major exhaustion point.
Single-Sided Evaluation : They ask "Is this a good long?" without checking if the short case is overwhelmingly stronger, leading you into obvious bad trades.
Static Configuration : You manually choose RSI 14 or Stochastic 14 and hope it works, with no systematic way to validate if that's optimal for your instrument.
BZ-CAE's Solution: Cognitive Adversarial Intelligence
BZ-CAE solves these problems through an integrated five-layer intelligence architecture:
1. Trend Conviction Score (TCS) — 0 to 1 Scale
Most indicators check if ADX is above 25 to determine "trending" conditions. This binary approach misses nuance. TCS is a weighted composite metric:
Formula : 0.35 × normalize(ADX, 10, 35) + 0.35 × structural_strength + 0.30 × htf_alignment
Structural Strength : 10-bar SMA of consecutive directional bars. Captures persistence — are bulls or bears consistently winning?
HTF Alignment : Multi-timeframe EMA stacking (20/50/100/200). When all EMAs align in the same direction, you're in institutional trend territory.
Purpose : Quantifies how "locked in" the trend is. When TCS exceeds your threshold (default 0.80), the system knows to avoid counter-trend trades unless other factors override.
Interpretation :
TCS > 0.85: Very strong trend — counter-trading is extremely high risk
TCS 0.70-0.85: Strong trend — favor continuation, require exhaustion for reversals
TCS 0.50-0.70: Moderate trend — context matters, both directions viable
TCS < 0.50: Weak/choppy — reversals more viable, range-bound conditions
2. Directional Momentum Alignment (DMA) — ATR-Normalized
Formula : (EMA21 - EMA55) / ATR14
This isn't just "price above EMA" — it's a regime-aware momentum gauge. The same $100 price movement reads completely differently in high-volatility crypto versus low-volatility forex. By normalizing with ATR, DMA adapts its interpretation to current market conditions.
Purpose : Quantifies the directional "force" behind current price action. Positive = bullish push, negative = bearish push. Magnitude = strength.
Interpretation :
DMA > 0.7: Strong bullish momentum — bearish divergences risky
DMA 0.3 to 0.7: Moderate bullish bias
DMA -0.3 to 0.3: Balanced/choppy conditions
DMA -0.7 to -0.3: Moderate bearish bias
DMA < -0.7: Strong bearish momentum — bullish divergences risky
3. Multi-Factor Exhaustion Modeling — 0 to 1 Probability
Single-metric exhaustion detection (like "RSI > 80") misses complex market states. BZ-CAE aggregates five independent exhaustion signals:
Volume Spikes : Current volume versus 50-bar average
2.5x average: 0.25 weight
2.0x average: 0.15 weight
1.5x average: 0.10 weight
Divergence Present : The fact that a divergence exists contributes 0.30 weight — structural momentum disagreement is itself an exhaustion signal.
RSI Extremes : Captures oscillator climax zones
RSI > 80 or < 20: 0.25 weight
RSI > 75 or < 25: 0.15 weight
Pin Bar Detection : Identifies rejection candles (2:1 wick-to-body ratio, indicating failed breakout attempts): 0.15 weight
Extended Runs : Consecutive bars above/below EMA20 without pullback
30+ bars: 0.15 weight (market hasn't paused to consolidate)
Total exhaustion score is the sum of all applicable weights, capped at 1.0.
Purpose : Detects when strong trends become vulnerable to reversal. High exhaustion can override trend filters, allowing counter-trend trades at genuine turning points that basic indicators would miss.
Interpretation :
Exhaustion > 0.75: High probability of climax — yellow background shading alerts you visually
Exhaustion 0.50-0.75: Moderate overextension — watch for confirmation
Exhaustion < 0.50: Fresh move — trend can continue, counter-trend trades higher risk
4. Adversarial Validation — Game Theory Applied to Trading
This is BZ-CAE's signature innovation. Before approving any signal, the engine quantifies BOTH sides of the trade simultaneously:
For Bullish Divergences , it calculates:
Bull Case Score (0-1+) :
Distance below EMA20 (pullback quality): up to 0.25
Bullish EMA alignment (close > EMA20 > EMA50): 0.25
Oversold RSI (< 40): 0.25
Volume confirmation (> 1.2x average): 0.25
Bear Case Score (0-1+) :
Price below EMA50 (structural weakness): 0.30
Very oversold RSI (< 30, indicating knife-catching): 0.20
Differential = Bull Case - Bear Case
If differential < -0.10 (default threshold), the bear case is dominating — signal is BLOCKED or ANNOTATED.
For Bearish Divergences , the logic inverts (Bear Case vs Bull Case).
Purpose : Prevents trades where you're fighting obvious strength in the opposite direction. This is institutional-grade risk management — don't just evaluate your trade, evaluate the counter-trade simultaneously.
Why This Matters : You might see a bullish divergence at a local low, but if price is deeply below major support EMAs with strong bearish momentum, you're catching a falling knife. The adversarial check catches this and blocks the signal.
5. Confidence Scoring — 0 to 1 Quality Assessment
Every signal that passes initial filters receives a comprehensive quality score:
Formula :
0.30 × normalize(TCS) // Trend context
+ 0.25 × normalize(|DMA|) // Momentum magnitude
+ 0.20 × pullback_quality // Entry distance from EMA20
+ 0.15 × state_quality // ADX + alignment + structure
+ 0.10 × divergence_strength // Slope separation magnitude
+ adversarial_bonus (0-0.30) // Your side's advantage
Purpose : Ranks setup quality for filtering and position sizing decisions. You can set a minimum confidence threshold (default 0.35) to ensure only quality setups reach your chart.
Interpretation :
Confidence > 0.70: Premium setup — consider increased position size
Confidence 0.50-0.70: Good quality — standard size
Confidence 0.35-0.50: Acceptable — reduced size or skip if conservative
Confidence < 0.35: Marginal — blocked in Filtering mode, annotated in Advisory mode
CAE Operating Modes: Learning vs Enforcement
Off : Disables all CAE logic. Raw divergence pipeline only. Use for baseline comparison.
Advisory : Shows ALL signals regardless of CAE evaluation, but annotates signals that WOULD be blocked with specific warnings (e.g., "Bull: strong downtrend (TCS=0.87)" or "Adversarial bearish"). This is your learning mode — see CAE's decision logic in action without missing educational opportunities.
Filtering : Actively blocks low-quality signals. Only setups that pass all enabled gates (Trend Filter, Adversarial Validation, Confidence Gating) reach your chart. This is your live trading mode — trust the system to enforce discipline.
CAE Filter Gates: Three-Layer Protection
When CAE is enabled, signals must pass through three independent gates (each can be toggled on/off):
Gate 1: Strong Trend Filter
If TCS ≥ tcs_threshold (default 0.80)
And signal is counter-trend (bullish in downtrend or bearish in uptrend)
And exhaustion < exhaustion_required (default 0.50)
Then: BLOCK signal
Logic: Don't fade strong trends unless the move is clearly overextended
Gate 2: Adversarial Validation
Calculate both bull case and bear case scores
If opposing case dominates by more than adv_threshold (default 0.10)
Then: BLOCK signal
Logic: Avoid trades where you're fighting obvious strength in the opposite direction
Gate 3: Confidence Gating
Calculate composite confidence score (0-1)
If confidence < min_confidence (default 0.35)
Then: In Filtering mode, BLOCK signal; in Advisory mode, ANNOTATE with warning
Logic: Only take setups with minimum quality threshold
All three gates work together. A signal must pass ALL enabled gates to fire.
Visual Intelligence System
Bifurcation Zones (Supply/Demand Blocks)
When a divergence signal fires, BZ-CAE draws a semi-transparent box extending 15 bars forward from the signal pivot:
Demand Zones (Bullish) : Theme-colored box (cyan in Cyberpunk, blue in Professional, etc.) labeled "Demand" — marks where smart money likely placed buy orders as price diverged at the low.
Supply Zones (Bearish) : Theme-colored box (magenta in Cyberpunk, orange in Professional) labeled "Supply" — marks where smart money likely placed sell orders as price diverged at the high.
Theory : Divergences represent institutional disagreement with the crowd. The crowd pushed price to an extreme (new high or low), but momentum (oscillator) is waning, indicating smart money is taking the opposite side. These zones mark order placement areas that become future support/resistance.
Use Cases :
Exit targets: Take profit when price returns to opposite-side zone
Re-entry levels: If price returns to your entry zone, consider adding
Stop placement: Place stops just beyond your zone (below demand, above supply)
Auto-Cleanup : System keeps the last 20 zones to prevent chart clutter.
Adversarial Bar Coloring — Real-Time Market Debate Heatmap
Each bar is colored based on the Bull Case vs Bear Case differential:
Strong Bull Advantage (diff > 0.3): Full theme bull color (e.g., cyan)
Moderate Bull Advantage (diff > 0.1): 50% transparency bull
Neutral (diff -0.1 to 0.1): Gray/neutral theme
Moderate Bear Advantage (diff < -0.1): 50% transparency bear
Strong Bear Advantage (diff < -0.3): Full theme bear color (e.g., magenta)
This creates a real-time visual heatmap showing which side is "winning" the market debate. When bars flip from cyan to magenta (or vice versa), you're witnessing a shift in adversarial advantage — a leading indicator of potential momentum changes.
Exhaustion Shading
When exhaustion score exceeds 0.75, the chart background displays a semi-transparent yellow highlight. This immediate visual warning alerts you that the current move is at high risk of reversal, even if trend indicators remain strong.
Visual Themes — Six Aesthetic Options
Cyberpunk : Cyan/Magenta/Yellow — High contrast, neon aesthetic, excellent for dark-themed trading environments
Professional : Blue/Orange/Green — Corporate color palette, suitable for presentations and professional documentation
Ocean : Teal/Red/Cyan — Aquatic palette, calming for extended monitoring sessions
Fire : Orange/Red/Coral — Warm aggressive colors, high energy
Matrix : Green/Red/Lime — Code aesthetic, homage to classic hacker visuals
Monochrome : White/Gray — Minimal distraction, maximum focus on price action
All visual elements (signal markers, zones, bar colors, dashboard) adapt to your selected theme.
Divergence Engine — Core Detection System
What Are Divergences?
Divergences occur when price action and momentum indicators disagree, creating structural tension that often resolves in a change of direction:
Regular Divergence (Reversal Signal) :
Bearish Regular : Price makes higher high, oscillator makes lower high → Potential trend reversal down
Bullish Regular : Price makes lower low, oscillator makes higher low → Potential trend reversal up
Hidden Divergence (Continuation Signal) :
Bearish Hidden : Price makes lower high, oscillator makes higher high → Downtrend continuation
Bullish Hidden : Price makes higher low, oscillator makes lower low → Uptrend continuation
Both types can be enabled/disabled independently in settings.
Pivot Detection Methods
BZ-CAE uses symmetric pivot detection with separate lookback and lookforward periods (default 5/5):
Pivot High : Bar where high > all highs within lookback range AND high > all highs within lookforward range
Pivot Low : Bar where low < all lows within lookback range AND low < all lows within lookforward range
This ensures structural validity — the pivot must be a clear local extreme, not just a minor wiggle.
Divergence Validation Requirements
For a divergence to be confirmed, it must satisfy:
Slope Disagreement : Price slope and oscillator slope must move in opposite directions (for regular divs) or same direction with inverted highs/lows (for hidden divs)
Minimum Slope Change : |osc_slope| > min_slope_change / 100 (default 1.0) — filters weak, marginal divergences
Maximum Lookback Range : Pivots must be within max_lookback bars (default 60) — prevents ancient, irrelevant divergences
ATR-Normalized Strength : Divergence strength = min(|price_slope| × |osc_slope| × 10, 1.0) — quantifies the magnitude of disagreement in volatility context
Regular divergences receive 1.0× weight; hidden divergences receive 0.8× weight (slightly less reliable historically).
Oscillator Options — Five Professional Indicators
RSI (Relative Strength Index) : Classic overbought/oversold momentum indicator. Best for: General purpose divergence detection across all instruments.
Stochastic : Range-bound %K momentum comparing close to high-low range. Best for: Mean reversion strategies and range-bound markets.
CCI (Commodity Channel Index) : Measures deviation from statistical mean, auto-normalized to 0-100 scale. Best for: Cyclical instruments and commodities.
MFI (Money Flow Index) : Volume-weighted RSI incorporating money flow. Best for: Volume-driven markets like stocks and crypto.
Williams %R : Inverse stochastic looking back over period, auto-adjusted to 0-100. Best for: Reversal detection at extremes.
Each oscillator has adjustable length (2-200, default 14) and smoothing (1-20, default 1). You also set overbought (50-100, default 70) and oversold (0-50, default 30) thresholds.
Signal Timing Modes — Understanding Repainting
BZ-CAE offers two timing policies with complete transparency about repainting behavior:
Realtime (1-bar, peak-anchored)
How It Works :
Detects peaks 1 bar ago using pattern: high > high AND high > high
Signal prints on the NEXT bar after peak detection (bar_index)
Visual marker anchors to the actual PEAK bar (bar_index - 1, offset -1)
Signal locks in when bar CONFIRMS (closes)
Repainting Behavior :
On the FORMING bar (before close), the peak condition may change as new prices arrive
Once bar CLOSES (barstate.isconfirmed), signal is locked permanently
This is preview/early warning behavior by design
Best For :
Active monitoring and immediate alerts
Learning the system (seeing signals develop in real-time)
Responsive entry if you're watching the chart live
Confirmed (lookforward)
How It Works :
Uses Pine Script's built-in ta.pivothigh() and ta.pivotlow() functions
Requires full pivot validation period (lookback + lookforward bars)
Signal prints pivot_lookforward bars after the actual peak (default 5-bar delay)
Visual marker anchors to the actual peak bar (offset -pivot_lookforward)
No Repainting Behavior
Best For :
Backtesting and historical analysis
Conservative entries requiring full confirmation
Automated trading systems
Swing trading with larger timeframes
Tradeoff :
Delayed entry by pivot_lookforward bars (typically 5 bars)
On a 5-minute chart, this is a 25-minute delay
On a 4-hour chart, this is a 20-hour delay
Recommendation : Use Confirmed for backtesting to verify system performance honestly. Use Realtime for live monitoring only if you're actively watching the chart and understand pre-confirmation repainting behavior.
Signal Spacing System — Anti-Spam Architecture
Even after CAE filtering, raw divergences can cluster. The spacing system enforces separation:
Three Independent Filters
1. Min Bars Between ANY Signals (default 12):
Prevents rapid-fire clustering across both directions
If last signal (bull or bear) was within N bars, block new signal
Ensures breathing room between all setups
2. Min Bars Between SAME-SIDE Signals (default 24, optional enforcement):
Prevents bull-bull or bear-bear spam
Separate tracking for bullish and bearish signal timelines
Toggle enforcement on/off
3. Min ATR Distance From Last Signal (default 0, optional):
Requires price to move N × ATR from last signal location
Ensures meaningful price movement between setups
0 = disabled, 0.5-2.0 = typical range for enabled
All three filters work independently. A signal must pass ALL enabled filters to proceed.
Practical Guidance :
Scalping (1-5m) : Any 6-10, Same-side 12-20, ATR 0-0.5
Day Trading (15m-1H) : Any 12, Same-side 24, ATR 0-1.0
Swing Trading (4H-D) : Any 20-30, Same-side 40-60, ATR 1.0-2.0
Dashboard — Real-Time Control Center
The dashboard (toggleable, four corner positions, three sizes) provides comprehensive system intelligence:
Oscillator Section
Current oscillator type and value
State: OVERBOUGHT / OVERSOLD / NEUTRAL (color-coded)
Length parameter
Cognitive Engine Section
TCS (Trend Conviction Score) :
Current value with emoji state indicator
🔥 = Strong trend (>0.75)
📊 = Moderate trend (0.50-0.75)
〰️ = Weak/choppy (<0.50)
Color: Red if above threshold (trend filter active), yellow if moderate, green if weak
DMA (Directional Momentum Alignment) :
Current value with emoji direction indicator
🐂 = Bullish momentum (>0.5)
⚖️ = Balanced (-0.5 to 0.5)
🐻 = Bearish momentum (<-0.5)
Color: Green if bullish, red if bearish
Exhaustion :
Current value with emoji warning indicator
⚠️ = High exhaustion (>0.75)
🟡 = Moderate (0.50-0.75)
✓ = Low (<0.50)
Color: Red if high, yellow if moderate, green if low
Pullback :
Quality of current distance from EMA20
Values >0.6 are ideal entry zones (not too close, not too far)
Bull Case / Bear Case (if Adversarial enabled):
Current scores for both sides of the market debate
Differential with emoji indicator:
📈 = Bull advantage (>0.2)
➡️ = Balanced (-0.2 to 0.2)
📉 = Bear advantage (<-0.2)
Last Signal Metrics Section (New Feature)
When a signal fires, this section captures and displays:
Signal type (BULL or BEAR)
Bars elapsed since signal
Confidence % at time of signal
TCS value at signal time
DMA value at signal time
Purpose : Provides a historical reference for learning. You can see what the market state looked like when the last signal fired, helping you correlate outcomes with conditions.
Statistics Section
Total Signals : Lifetime count across session
Blocked Signals : Count and percentage (filter effectiveness metric)
Bull Signals : Total bullish divergences
Bear Signals : Total bearish divergences
Purpose : System health monitoring. If blocked % is very high (>60%), filters may be too strict. If very low (<10%), filters may be too loose.
Advisory Annotations
When CAE Mode = Advisory, this section displays warnings for signals that would be blocked in Filtering mode:
Examples:
"Bull spacing: wait 8 bars"
"Bear: strong uptrend (TCS=0.87)"
"Adversarial bearish"
"Low confidence 32%"
Multiple warnings can stack, separated by " | ". This teaches you CAE's decision logic transparently.
How to Use BZ-CAE — Complete Workflow
Phase 1: Initial Setup (First Session)
Apply BZ-CAE to your chart
Select your preferred Visual Theme (Cyberpunk recommended for visibility)
Set Signal Timing to "Confirmed (lookforward)" for learning
Choose your Oscillator Type (RSI recommended for general use, length 14)
Set Overbought/Oversold to 70/30 (standard)
Enable both Regular Divergence and Hidden Divergence
Set Pivot Lookback/Lookforward to 5/5 (balanced structure)
Enable CAE Intelligence
Set CAE Mode to "Advisory" (learning mode)
Enable all three CAE filters: Strong Trend Filter , Adversarial Validation , Confidence Gating
Enable Show Dashboard , position Top Right, size Normal
Enable Draw Bifurcation Zones and Adversarial Bar Coloring
Phase 2: Learning Period (Weeks 1-2)
Goal : Understand how CAE evaluates market state and filters signals.
Activities :
Watch the dashboard during signals :
Note TCS values when counter-trend signals fail — this teaches you the trend strength threshold for your instrument
Observe exhaustion patterns at actual turning points — learn when overextension truly matters
Study adversarial differential at signal times — see when opposing cases dominate
Review blocked signals (orange X-crosses):
In Advisory mode, you see everything — signals that would pass AND signals that would be blocked
Check the advisory annotations to understand why CAE would block
Track outcomes: Were the blocks correct? Did those signals fail?
Use Last Signal Metrics :
After each signal, check the dashboard capture of confidence, TCS, and DMA
Journal these values alongside trade outcomes
Identify patterns: Do confidence >0.70 signals work better? Does your instrument respect TCS >0.85?
Understand your instrument's "personality" :
Trending instruments (indices, major forex) may need TCS threshold 0.85-0.90
Choppy instruments (low-cap stocks, exotic pairs) may work best with TCS 0.70-0.75
High-volatility instruments (crypto) may need wider spacing
Low-volatility instruments may need tighter spacing
Phase 3: Calibration (Weeks 3-4)
Goal : Optimize settings for your specific instrument, timeframe, and style.
Calibration Checklist :
Min Confidence Threshold :
Review confidence distribution in your signal journal
Identify the confidence level below which signals consistently fail
Set min_confidence slightly above that level
Day trading : 0.35-0.45
Swing trading : 0.40-0.55
Scalping : 0.30-0.40
TCS Threshold :
Find the TCS level where counter-trend signals consistently get stopped out
Set tcs_threshold at or slightly below that level
Trending instruments : 0.85-0.90
Mixed instruments : 0.80-0.85
Choppy instruments : 0.75-0.80
Exhaustion Override Level :
Identify exhaustion readings that marked genuine reversals
Set exhaustion_required just below the average
Typical range : 0.45-0.55
Adversarial Threshold :
Default 0.10 works for most instruments
If you find CAE is too conservative (blocking good trades), raise to 0.15-0.20
If signals are still getting caught in opposing momentum, lower to 0.07-0.09
Spacing Parameters :
Count bars between quality signals in your journal
Set min bars ANY to ~60% of that average
Set min bars SAME-SIDE to ~120% of that average
Scalping : Any 6-10, Same 12-20
Day trading : Any 12, Same 24
Swing : Any 20-30, Same 40-60
Oscillator Selection :
Try different oscillators for 1-2 weeks each
Track win rate and average winner/loser by oscillator type
RSI : Best for general use, clear OB/OS
Stochastic : Best for range-bound, mean reversion
MFI : Best for volume-driven markets
CCI : Best for cyclical instruments
Williams %R : Best for reversal detection
Phase 4: Live Deployment
Goal : Disciplined execution with proven, calibrated system.
Settings Changes :
Switch CAE Mode from Advisory to Filtering
System now actively blocks low-quality signals
Only setups passing all gates reach your chart
Keep Signal Timing on Confirmed for conservative entries
OR switch to Realtime if you're actively monitoring and want faster entries (accept pre-confirmation repaint risk)
Use your calibrated thresholds from Phase 3
Enable high-confidence alerts: "⭐ High Confidence Bullish/Bearish" (>0.70)
Trading Discipline Rules :
Respect Blocked Signals :
If CAE blocks a trade you wanted to take, TRUST THE SYSTEM
Don't manually override — if you consistently disagree, return to Phase 2/3 calibration
The block exists because market state failed intelligence checks
Confidence-Based Position Sizing :
Confidence >0.70: Standard or increased size (e.g., 1.5-2.0% risk)
Confidence 0.50-0.70: Standard size (e.g., 1.0% risk)
Confidence 0.35-0.50: Reduced size (e.g., 0.5% risk) or skip if conservative
TCS-Based Management :
High TCS + counter-trend signal: Use tight stops, quick exits (you're fading momentum)
Low TCS + reversal signal: Use wider stops, trail aggressively (genuine reversal potential)
Exhaustion Awareness :
Exhaustion >0.75 (yellow shading): Market is overextended, reversal risk is elevated — consider early exit or tighter trailing stops even on winning trades
Exhaustion <0.30: Continuation bias — hold for larger move, wide trailing stops
Adversarial Context :
Strong differential against you (e.g., bullish signal with bear diff <-0.2): Use very tight stops, consider skipping
Strong differential with you (e.g., bullish signal with bull diff >0.2): Trail aggressively, this is your tailwind
Practical Settings by Timeframe & Style
Scalping (1-5 Minute Charts)
Objective : High frequency, tight stops, quick reversals in fast-moving markets.
Oscillator :
Type: RSI or Stochastic (fast response to quick moves)
Length: 9-11 (more responsive than standard 14)
Smoothing: 1 (no lag)
OB/OS: 65/35 (looser thresholds ensure frequent crossings in fast conditions)
Divergence :
Pivot Lookback/Lookforward: 3/3 (tight structure, catch small swings)
Max Lookback: 40-50 bars (recent structure only)
Min Slope Change: 0.8-1.0 (don't be overly strict)
CAE :
Mode: Advisory first (learn), then Filtering
Min Confidence: 0.30-0.35 (lower bar for speed, accept more signals)
TCS Threshold: 0.70-0.75 (allow more counter-trend opportunities)
Exhaustion Required: 0.45-0.50 (moderate override)
Strong Trend Filter: ON (still respect major intraday trends)
Adversarial: ON (critical for scalping protection — catches bad entries quickly)
Spacing :
Min Bars ANY: 6-10 (fast pace, many setups)
Min Bars SAME-SIDE: 12-20 (prevent clustering)
Min ATR Distance: 0 or 0.5 (loose)
Timing : Realtime (speed over precision, but understand repaint risk)
Visuals :
Signal Size: Tiny (chart clarity in busy conditions)
Show Zones: Optional (can clutter on low timeframes)
Bar Coloring: ON (helps read momentum shifts quickly)
Dashboard: Small size (corner reference, not main focus)
Key Consideration : Scalping generates noise. Even with CAE, expect lower win rate (45-55%) but aim for favorable R:R (2:1 or better). Size conservatively.
Day Trading (15-Minute to 1-Hour Charts)
Objective : Balance quality and frequency. Standard divergence trading approach.
Oscillator :
Type: RSI or MFI (proven reliability, volume confirmation with MFI)
Length: 14 (industry standard, well-studied)
Smoothing: 1-2
OB/OS: 70/30 (classic levels)
Divergence :
Pivot Lookback/Lookforward: 5/5 (balanced structure)
Max Lookback: 60 bars
Min Slope Change: 1.0 (standard strictness)
CAE :
Mode: Filtering (enforce discipline from the start after brief Advisory learning)
Min Confidence: 0.35-0.45 (quality filter without being too restrictive)
TCS Threshold: 0.80-0.85 (respect strong trends)
Exhaustion Required: 0.50 (balanced override threshold)
Strong Trend Filter: ON
Adversarial: ON
Confidence Gating: ON (all three filters active)
Spacing :
Min Bars ANY: 12 (breathing room between all setups)
Min Bars SAME-SIDE: 24 (prevent bull/bear clusters)
Min ATR Distance: 0-1.0 (optional refinement, typically 0.5-1.0)
Timing : Confirmed (1-bar delay for reliability, no repainting)
Visuals :
Signal Size: Tiny or Small
Show Zones: ON (useful reference for exits/re-entries)
Bar Coloring: ON (context awareness)
Dashboard: Normal size (full visibility)
Key Consideration : This is the "sweet spot" timeframe for BZ-CAE. Market structure is clear, CAE has sufficient data, and signal frequency is manageable. Expect 55-65% win rate with proper execution.
Swing Trading (4-Hour to Daily Charts)
Objective : Quality over quantity. High conviction only. Larger stops and targets.
Oscillator :
Type: RSI or CCI (robust on higher timeframes, smooth longer waves)
Length: 14-21 (capture larger momentum swings)
Smoothing: 1-3
OB/OS: 70/30 or 75/25 (strict extremes)
Divergence :
Pivot Lookback/Lookforward: 5/5 or 7/7 (structural purity, major swings only)
Max Lookback: 80-100 bars (broader historical context)
Min Slope Change: 1.2-1.5 (require strong, undeniable divergence)
CAE :
Mode: Filtering (strict enforcement, premium setups only)
Min Confidence: 0.40-0.55 (high bar for entry)
TCS Threshold: 0.85-0.95 (very strong trend protection — don't fade established HTF trends)
Exhaustion Required: 0.50-0.60 (higher bar for override — only extreme exhaustion justifies counter-trend)
Strong Trend Filter: ON (critical on HTF)
Adversarial: ON (avoid obvious bad trades)
Confidence Gating: ON (quality gate essential)
Spacing :
Min Bars ANY: 20-30 (substantial separation)
Min Bars SAME-SIDE: 40-60 (significant breathing room)
Min ATR Distance: 1.0-2.0 (require meaningful price movement)
Timing : Confirmed (purity over speed, zero repaint for swing accuracy)
Visuals :
Signal Size: Small or Normal (clear markers on zoomed-out view)
Show Zones: ON (important HTF levels)
Bar Coloring: ON (long-term trend awareness)
Dashboard: Normal or Large (comprehensive analysis)
Key Consideration : Swing signals are rare but powerful. Expect 2-5 signals per month per instrument. Win rate should be 60-70%+ due to stringent filtering. Position size can be larger given confidence.
Dashboard Interpretation Reference
TCS (Trend Conviction Score) States
0.00-0.50: Weak/Choppy
Emoji: 〰️
Color: Green/cyan
Meaning: No established trend. Range-bound or consolidating. Both reversal and continuation signals viable.
Action: Reversals (regular divs) are safer. Use wider profit targets (market has room to move). Consider mean reversion strategies.
0.50-0.75: Moderate Trend
Emoji: 📊
Color: Yellow/neutral
Meaning: Developing trend but not locked in. Context matters significantly.
Action: Check DMA and exhaustion. If DMA confirms trend and exhaustion is low, favor continuation (hidden divs). If exhaustion is high, reversals are viable.
0.75-0.85: Strong Trend
Emoji: 🔥
Color: Orange/warning
Meaning: Well-established trend with persistence. Counter-trend is high risk.
Action: Require exhaustion >0.50 for counter-trend entries. Favor continuation signals. Use tight stops on counter-trend attempts.
0.85-1.00: Very Strong Trend
Emoji: 🔥🔥
Color: Red/danger (if counter-trading)
Meaning: Locked-in institutional trend. Extremely high risk to fade.
Action: Avoid counter-trend unless exhaustion >0.75 (yellow shading). Focus exclusively on continuation opportunities. Momentum is king here.
DMA (Directional Momentum Alignment) Zones
-2.0 to -1.0: Strong Bearish Momentum
Emoji: 🐻🐻
Color: Dark red
Meaning: Powerful downside force. Sellers are in control.
Action: Bullish divergences are counter-momentum (high risk). Bearish divergences are with-momentum (lower risk). Size down on longs.
-0.5 to 0.5: Neutral/Balanced
Emoji: ⚖️
Color: Gray/neutral
Meaning: No strong directional bias. Choppy or consolidating.
Action: Both directions have similar probability. Focus on confidence score and adversarial differential for edge.
1.0 to 2.0: Strong Bullish Momentum
Emoji: 🐂🐂
Color: Bright green/cyan
Meaning: Powerful upside force. Buyers are in control.
Action: Bearish divergences are counter-momentum (high risk). Bullish divergences are with-momentum (lower risk). Size down on shorts.
Exhaustion States
0.00-0.50: Fresh Move
Emoji: ✓
Color: Green
Meaning: Trend is healthy, not overextended. Room to run.
Action: Counter-trend trades are premature. Favor continuation. Hold winners for larger moves. Avoid early exits.
0.50-0.75: Mature Move
Emoji: 🟡
Color: Yellow
Meaning: Move is aging. Watch for signs of climax.
Action: Tighten trailing stops on winning trades. Be ready for reversals. Don't add to positions aggressively.
0.75-0.85: High Exhaustion
Emoji: ⚠️
Color: Orange
Background: Yellow shading appears
Meaning: Move is overextended. Reversal risk elevated significantly.
Action: Counter-trend reversals are higher probability. Consider early exits on with-trend positions. Size up on reversal divergences (if CAE allows).
0.85-1.00: Critical Exhaustion
Emoji: ⚠️⚠️
Color: Red
Background: Yellow shading intensifies
Meaning: Climax conditions. Reversal imminent or underway.
Action: Aggressive reversal trades justified. Exit all with-trend positions. This is where major turns occur.
Confidence Score Tiers
0.00-0.30: Low Quality
Color: Red
Status: Blocked in Filtering mode
Action: Skip entirely. Setup lacks fundamental quality across multiple factors.
0.30-0.50: Moderate Quality
Color: Yellow/orange
Status: Marginal — passes in Filtering only if >min_confidence
Action: Reduced position size (0.5-0.75% risk). Tight stops. Conservative profit targets. Skip if you're selective.
0.50-0.70: High Quality
Color: Green/cyan
Status: Good setup across most quality factors
Action: Standard position size (1.0-1.5% risk). Normal stops and targets. This is your bread-and-butter trade.
0.70-1.00: Premium Quality
Color: Bright green/gold
Status: Exceptional setup — all factors aligned
Visual: Double confidence ring appears
Action: Consider increased position size (1.5-2.0% risk, maximum). Wider stops. Larger targets. High probability of success. These are rare — capitalize when they appear.
Adversarial Differential Interpretation
Bull Differential > 0.3 :
Visual: Strong cyan/green bar colors
Meaning: Bull case strongly dominates. Buyers have clear advantage.
Action: Bullish divergences favored (with-advantage). Bearish divergences face headwind (reduce size or skip). Momentum is bullish.
Bull Differential 0.1 to 0.3 :
Visual: Moderate cyan/green transparency
Meaning: Moderate bull advantage. Buyers have edge but not overwhelming.
Action: Both directions viable. Slight bias toward longs.
Differential -0.1 to 0.1 :
Visual: Gray/neutral bars
Meaning: Balanced debate. No clear advantage either side.
Action: Rely on other factors (confidence, TCS, exhaustion) for direction. Adversarial is neutral.
Bear Differential -0.3 to -0.1 :
Visual: Moderate red/magenta transparency
Meaning: Moderate bear advantage. Sellers have edge but not overwhelming.
Action: Both directions viable. Slight bias toward shorts.
Bear Differential < -0.3 :
Visual: Strong red/magenta bar colors
Meaning: Bear case strongly dominates. Sellers have clear advantage.
Action: Bearish divergences favored (with-advantage). Bullish divergences face headwind (reduce size or skip). Momentum is bearish.
Last Signal Metrics — Post-Trade Analysis
After a signal fires, dashboard captures:
Type : BULL or BEAR
Bars Ago : How long since signal (updates every bar)
Confidence : What was the quality score at signal time
TCS : What was trend conviction at signal time
DMA : What was momentum alignment at signal time
Use Case : Post-trade journaling and learning.
Example: "BULL signal 12 bars ago. Confidence: 68%, TCS: 0.42, DMA: -0.85"
Analysis : This was a bullish reversal (regular div) with good confidence, weak trend (TCS), but strong bearish momentum (DMA). The bet was that momentum would reverse — a counter-momentum play requiring exhaustion confirmation. Check if exhaustion was high at that time to justify the entry.
Track patterns:
Do your best trades have confidence >0.65?
Do low-TCS signals (<0.50) work better for you?
Are you more successful with-momentum (DMA aligned with signal) or counter-momentum?
Troubleshooting Guide
Problem: No Signals Appearing
Symptoms : Chart loads, dashboard shows metrics, but no divergence signals fire.
Diagnosis Checklist :
Check dashboard oscillator value : Is it crossing OB/OS levels (70/30)? If oscillator stays in 40-60 range constantly, it can't reach extremes needed for divergence detection.
Are pivots forming? : Look for local swing highs/lows on your chart. If price is in tight consolidation, pivots may not meet lookback/lookforward requirements.
Is spacing too tight? : Check "Last Signal" metrics — how many bars since last signal? If <12 and your min_bars_ANY is 12, spacing filter is blocking.
Is CAE blocking everything? : Check dashboard Statistics section — what's the blocked signal count? High blocks indicate overly strict filters.
Solutions :
Loosen OB/OS Temporarily :
Try 65/35 to verify divergence detection works
If signals appear, the issue was threshold strictness
Gradually tighten back to 67/33, then 70/30 as appropriate
Lower Min Confidence :
Try 0.25-0.30 (diagnostic level)
If signals appear, filter was too strict
Raise gradually to find sweet spot (0.35-0.45 typical)
Disable Strong Trend Filter Temporarily :
Turn off in CAE settings
If signals appear, TCS threshold was blocking everything
Re-enable and lower TCS_threshold to 0.70-0.75
Reduce Min Slope Change :
Try 0.7-0.8 (from default 1.0)
Allows weaker divergences through
Helpful on low-volatility instruments
Widen Spacing :
Set min_bars_ANY to 6-8
Set min_bars_SAME_SIDE to 12-16
Reduces time between allowed signals
Check Timing Mode :
If using Confirmed, remember there's a pivot_lookforward delay (5+ bars)
Switch to Realtime temporarily to verify system is working
Realtime has no delay but repaints
Verify Oscillator Settings :
Length 14 is standard but might not fit all instruments
Try length 9-11 for faster response
Try length 18-21 for slower, smoother response
Problem: Too Many Signals (Signal Spam)
Symptoms : Dashboard shows 50+ signals in Statistics, confidence scores mostly <0.40, signals clustering close together.
Solutions :
Raise Min Confidence :
Try 0.40-0.50 (quality filter)
Blocks bottom-tier setups
Targets top 50-60% of divergences only
Tighten OB/OS :
Use 70/30 or 75/25
Requires more extreme oscillator readings
Reduces false divergences in mid-range
Increase Min Slope Change :
Try 1.2-1.5 (from default 1.0)
Requires stronger, more obvious divergences
Filters marginal slope disagreements
Raise TCS Threshold :
Try 0.85-0.90 (from default 0.80)
Stricter trend filter blocks more counter-trend attempts
Favors only strongest trend alignment
Enable ALL CAE Gates :
Turn on Trend Filter + Adversarial + Confidence
Triple-layer protection
Blocks aggressively — expect 20-40% reduction in signals
Widen Spacing :
min_bars_ANY: 15-20 (from 12)
min_bars_SAME_SIDE: 30-40 (from 24)
Creates substantial breathing room
Switch to Confirmed Timing :
Removes realtime preview noise
Ensures full pivot validation
5-bar delay filters many false starts
Problem: Signals in Strong Trends Get Stopped Out
Symptoms : You take a bullish divergence in a downtrend (or bearish in uptrend), and it immediately fails. Dashboard showed high TCS at the time.
Analysis : This is INTENDED behavior — CAE is protecting you from low-probability counter-trend trades.
Understanding :
Check Last Signal Metrics in dashboard — what was TCS when signal fired?
If TCS was >0.85 and signal was counter-trend, CAE correctly identified it as high risk
Strong trends rarely reverse cleanly without major exhaustion
Your losses here are the system working as designed (blocking bad odds)
If You Want to Override (Not Recommended) :
Lower TCS_threshold to 0.70-0.75 (allows more counter-trend)
Lower exhaustion_required to 0.40 (easier override)
Disable Strong Trend Filter entirely (very risky)
Better Approach :
TRUST THE FILTER — it's preventing costly mistakes
Wait for exhaustion >0.75 (yellow shading) before counter-trending strong TCS
Focus on continuation signals (hidden divs) in high-TCS environments
Use Advisory mode to see what CAE is blocking and learn from outcomes
Problem: Adversarial Blocking Seems Wrong
Symptoms : You see a divergence that "looks good" visually, but CAE blocks with "Adversarial bearish/bullish" warning.
Diagnosis :
Check dashboard Bull Case and Bear Case scores at that moment
Look at Differential value
Check adversarial bar colors — was there strong coloring against your intended direction?
Understanding :
Adversarial catches "obvious" opposing momentum that's easy to miss
Example: Bullish divergence at a local low, BUT price is deeply below EMA50, bearish momentum is strong, and RSI shows knife-catching conditions
Bull Case might be 0.20 while Bear Case is 0.55
Differential = -0.35, far beyond threshold
Block is CORRECT — you'd be fighting overwhelming opposing flow
If You Disagree Consistently
Review blocked signals on chart — scroll back and check outcomes
Did those blocked signals actually work, or did they fail as adversarial predicted?
Raise adv_threshold to 0.15-0.20 (more permissive, allows closer battles)
Disable Adversarial Validation temporarily (diagnostic) to isolate its effect
Use Advisory mode to learn adversarial patterns over 50-100 signals
Remember : Adversarial is conservative BY DESIGN. It prevents "obvious" bad trades where you're fighting strong strength the other way.
Problem: Dashboard Not Showing or Incomplete
Solutions :
Toggle "Show Dashboard" to ON in settings
Try different dashboard sizes (Small/Normal/Large)
Try different positions (Top Left/Right, Bottom Left/Right) — might be off-screen
Some sections require CAE Enable = ON (Cognitive Engine section won't appear if CAE is disabled)
Statistics section requires at least 1 lifetime signal to populate
Check that visual theme is set (dashboard colors adapt to theme)
Problem: Performance Lag, Chart Freezing
Symptoms : Chart loading is slow, indicator calculations cause delays, pinch-to-zoom lags.
Diagnosis : Visual features are computationally expensive, especially adversarial bar coloring (recalculates every bar).
Solutions (In Order of Impact) :
Disable Adversarial Bar Coloring (MOST EXPENSIVE):
Turn OFF "Adversarial Bar Coloring" in settings
This is the single biggest performance drain
Immediate improvement
Reduce Vertical Lines :
Lower "Keep last N vertical lines" to 20-30
Or set to 0 to disable entirely
Moderate improvement
Disable Bifurcation Zones :
Turn OFF "Draw Bifurcation Zones"
Reduces box drawing calculations
Moderate improvement
Set Dashboard Size to Small :
Smaller dashboard = fewer cells = less rendering
Minor improvement
Use Shorter Max Lookback :
Reduce max_lookback to 40-50 (from 60+)
Fewer bars to scan for divergences
Minor improvement
Disable Exhaustion Shading :
Turn OFF "Show Market State"
Removes background coloring calculations
Minor improvement
Extreme Performance Mode :
Disable ALL visual enhancements
Keep only triangle markers
Dashboard Small or OFF
Use Minimal theme if available
Problem: Realtime Signals Repainting
Symptoms : You see a signal appear, but on next bar it disappears or moves.
Explanation :
Realtime mode detects peaks 1 bar ago: high > high AND high > high
On the FORMING bar (before close), this condition can change as new prices arrive
Example: At 10:05, high (10:04 bar) was 100, current high is 99 → peak detected
At 10:05:30, new high of 101 arrives → peak condition breaks → signal disappears
At 10:06 (bar close), final high is 101 → no peak at 10:04 anymore → signal gone permanently
This is expected behavior for realtime responsiveness. You get preview/early warning, but it's not locked until bar confirms.
Solutions :
Use Confirmed Timing :
Switch to "Confirmed (lookforward)" mode
ZERO repainting — pivot must be fully validated
5-bar delay (pivot_lookforward)
What you see in history is exactly what would have appeared live
Accept Realtime Repaint as Tradeoff :
Keep Realtime mode for speed and alerts
Understand that pre-confirmation signals may vanish
Only trade signals that CONFIRM at bar close (check barstate.isconfirmed)
Use for live monitoring, NOT for backtesting
Trade Only After Confirmation :
In Realtime mode, wait 1 full bar after signal appears before entering
If signal survives that bar close, it's locked
This adds 1-bar delay but removes repaint risk
Recommendation : Use Confirmed for backtesting and conservative trading. Use Realtime only for active monitoring with full understanding of preview behavior.
Risk Management Integration
BZ-CAE is a signal generation system, not a complete trading strategy. You must integrate proper risk management:
Position Sizing by Confidence
Confidence 0.70-1.00 (Premium) :
Risk: 1.5-2.0% of account (MAXIMUM)
Reasoning: High-quality setup across all factors
Still cap at 2% — even premium setups can fail
Confidence 0.50-0.70 (High Quality) :
Risk: 1.0-1.5% of account
Reasoning: Standard good setup
Your bread-and-butter risk level
Confidence 0.35-0.50 (Moderate Quality) :
Risk: 0.5-1.0% of account
Reasoning: Marginal setup, passes minimum threshold
Reduce size or skip if you're selective
Confidence <0.35 (Low Quality) :
Risk: 0% (blocked in Filtering mode)
Reasoning: Insufficient quality factors
System protects you by not showing these
Stop Placement Strategies
For Reversal Signals (Regular Divergences) :
Place stop beyond the divergence pivot plus buffer
Bullish : Stop below the divergence low - 1.0-1.5 × ATR
Bearish : Stop above the divergence high + 1.0-1.5 × ATR
Reasoning: If price breaks the pivot, divergence structure is invalidated
For Continuation Signals (Hidden Divergences) :
Place stop beyond recent swing in opposite direction
Bullish continuation : Stop below recent swing low (not the divergence pivot itself)
Bearish continuation : Stop above recent swing high
Reasoning: You're trading with trend, allow more breathing room
ATR-Based Stops :
1.5-2.0 × ATR is standard
Scale by timeframe:
Scalping (1-5m): 1.0-1.5 × ATR (tight)
Day trading (15m-1H): 1.5-2.0 × ATR (balanced)
Swing (4H-D): 2.0-3.0 × ATR (wide)
Never Use Fixed Dollar/Pip Stops :
Markets have different volatility
50-pip stop on EUR/USD ≠ 50-pip stop on GBP/JPY
Always normalize by ATR or pivot structure
Profit Targets and Scaling
Primary Target :
2-3 × ATR from entry (minimum 2:1 reward-risk)
Example : Entry at 100, ATR = 2, stop at 97 (1.5 × ATR) → target at 106 (3 × ATR) = 2:1 R:R
Scaling Out Strategy :
Take 50% off at 1.5 × ATR (secure partial profit)
Move stop to breakeven
Trail remaining 50% with 1.0 × ATR trailing stop
Let winners run if trend persists
Targets by Confidence :
High Confidence (>0.70) : Aggressive targets (3-4 × ATR), trail wider (1.5 × ATR)
Standard Confidence (0.50-0.70) : Normal targets (2-3 × ATR), standard trail (1.0 × ATR)
Low Confidence (0.35-0.50) : Conservative targets (1.5-2 × ATR), tight trail (0.75 × ATR)
Use Bifurcation Zones :
If opposite-side zone is visible on chart (from previous signal), use it as target
Example : Bullish signal at 100, prior supply zone at 110 → use 110 as target
Zones mark institutional resistance/support
Exhaustion-Based Exits :
If you're in a trade and exhaustion >0.75 develops (yellow shading), consider early exit
Market is overextended — reversal risk is high
Take profit even if target not reached
Trade Management by TCS
High TCS + Counter-Trend Trade (Risky) :
Use very tight stops (1.0-1.5 × ATR)
Conservative targets (1.5-2 × ATR)
Quick exit if trade doesn't work immediately
You're fading momentum — respect it
Low TCS + Reversal Trade (Safer) :
Use wider stops (2.0-2.5 × ATR)
Aggressive targets (3-4 × ATR)
Trail with patience
Genuine reversal potential in weak trend
High TCS + Continuation Trade (Safest) :
Standard stops (1.5-2.0 × ATR)
Very aggressive targets (4-5 × ATR)
Trail wide (1.5-2.0 × ATR)
You're with institutional momentum — let it run
Educational Value — Learning Machine Intelligence
BZ-CAE is designed as a learning platform, not just a tool:
Advisory Mode as Teacher
Most indicators are binary: signal or no signal. You don't learn WHY certain setups are better.
BZ-CAE's Advisory mode shows you EVERY potential divergence, then annotates the ones that would be blocked in Filtering mode with specific reasons:
"Bull: strong downtrend (TCS=0.87)" teaches you that TCS >0.85 makes counter-trend very risky
"Adversarial bearish" teaches you that the opposing case was dominating
"Low confidence 32%" teaches you that the setup lacked quality across multiple factors
"Bull spacing: wait 8 bars" teaches you that signals need breathing room
After 50-100 signals in Advisory mode, you internalize the CAE's decision logic. You start seeing these factors yourself BEFORE the indicator does.
Dashboard Transparency
Most "intelligent" indicators are black boxes — you don't know how they make decisions.
BZ-CAE shows you ALL metrics in real-time:
TCS tells you trend strength
DMA tells you momentum alignment
Exhaustion tells you overextension
Adversarial shows both sides of the debate
Confidence shows composite quality
You learn to interpret market state holistically, a skill applicable to ANY trading system beyond this indicator.
Divergence Quality Education
Not all divergences are equal. BZ-CAE teaches you which conditions produce high-probability setups:
Quality divergence : Regular bullish div at a low, TCS <0.50 (weak trend), exhaustion >0.75 (overextended), positive adversarial differential, confidence >0.70
Low-quality divergence : Regular bearish div at a high, TCS >0.85 (strong uptrend), exhaustion <0.30 (not overextended), negative adversarial differential, confidence <0.40
After using the system, you can evaluate divergences manually with similar intelligence.
Risk Management Discipline
Confidence-based position sizing teaches you to adjust risk based on setup quality, not emotions:
Beginners often size all trades identically
Or worse, size UP on marginal setups to "make up" for losses
BZ-CAE forces systematic sizing: premium setups get larger size, marginal setups get smaller size
This creates a probabilistic approach where your edge compounds over time.
What This Indicator Is NOT
Complete transparency about limitations and positioning:
Not a Prediction System
BZ-CAE does not predict future prices. It identifies structural divergences (price-momentum disagreements) and assesses current market state (trend, exhaustion, adversarial conditions). It tells you WHEN conditions favor a potential reversal or continuation, not WHAT WILL HAPPEN.
Markets are probabilistic. Even premium-confidence setups fail ~30-40% of the time. The system improves your probability distribution over many trades — it doesn't eliminate risk.
Not Fully Automated
This is a decision support tool, not a trading robot. You must:
Execute trades manually based on signals
Manage positions (stops, targets, trailing)
Apply discretionary judgment (news events, liquidity, context)
Integrate with your broader strategy and risk rules
The confidence scores guide position sizing, but YOU determine final risk allocation based on your account size, risk tolerance, and portfolio context.
Not Beginner-Friendly
BZ-CAE requires understanding of:
Divergence trading concepts (regular vs hidden, reversal vs continuation)
Market state interpretation (trend vs range, momentum, exhaustion)
Basic technical analysis (pivots, support/resistance, EMAs)
Risk management fundamentals (position sizing, stops, R:R)
This is designed for intermediate to advanced traders willing to invest time learning the system. If you want "buy the arrow" simplicity, this isn't the tool.
Not a Holy Grail
There is no perfect indicator. BZ-CAE filters noise and improves signal quality significantly, but:
Losing trades are inevitable (even at 70% win rate, 30% still fail)
Market conditions change rapidly (yesterday's strong trend becomes today's chop)
Black swan events occur (fundamentals override technicals)
Execution matters (slippage, fees, emotional discipline)
The system provides an EDGE, not a guarantee. Your job is to execute that edge consistently with proper risk management over hundreds of trades.
Not Financial Advice
BZ-CAE is an educational and analytical tool. All trading decisions are your responsibility. Past performance (backtested or live) does not guarantee future results. Only risk capital you can afford to lose. Consult a licensed financial advisor for investment advice specific to your situation.
Ideal Market Conditions
Best Performance Characteristics
Liquid Instruments :
Major forex pairs (EUR/USD, GBP/USD, USD/JPY)
Large-cap stocks and index ETFs (SPY, QQQ, AAPL, MSFT)
High-volume crypto (BTC, ETH)
Major commodities (Gold, Oil, Natural Gas)
Reasoning: Clean price structure, clear pivots, meaningful oscillator behavior
Trending with Consolidations :
Markets that trend for 20-40 bars, then consolidate 10-20 bars, repeat
Creates divergences at consolidation boundaries (reversals) and within trends (continuations)
Both regular and hidden divs find opportunities
5-Minute to Daily Timeframes :
Below 5m: too much noise, false pivots, CAE metrics unstable
Above daily: too few signals, edge diminishes (fundamentals dominate)
Sweet spot: 15m to 4H for most traders
Consistent Volume and Participation :
Regular trading sessions (not holidays or thin markets)
Predictable volatility patterns
Avoid instruments with sudden gaps or circuit breakers
Challenging Conditions
Extremely Low Liquidity :
Penny stocks, exotic forex pairs, low-volume crypto
Erratic pivots, unreliable oscillator readings
CAE metrics can't assess market state properly
Very Low Timeframes (1-Minute or Below) :
Dominated by market microstructure noise
Divergences are everywhere but meaningless
CAE filtering helps but still unreliable
Extended Sideways Consolidation :
100+ bars of tight range with no clear pivots
Oscillator hugs midpoint (45-55 range)
No divergences to detect
Fundamentally-Driven Gap Markets :
Earnings releases, economic data, geopolitical events
Price gaps over stops and targets
Technical structure breaks down
Recommendation: Disable trading around known events
Calculation Methodology — Technical Depth
For users who want to understand the math:
Oscillator Computation
Each oscillator type calculates differently, but all normalize to 0-100:
RSI : ta.rsi(close, length) — Standard Relative Strength Index
Stochastic : ta.stoch(high, low, close, length) — %K calculation
CCI : (ta.cci(hlc3, length) + 100) / 2 — Normalized from -100/+100 to 0-100
MFI : ta.mfi(hlc3, length) — Volume-weighted RSI equivalent
Williams %R : ta.wpr(length) + 100 — Inverted stochastic adjusted to 0-100
Smoothing: If smoothing > 1, apply ta.sma(oscillator, smoothing)
Divergence Detection Algorithm
Identify Pivots :
Price high pivot: ta.pivothigh(high, lookback, lookforward)
Price low pivot: ta.pivotlow(low, lookback, lookforward)
Oscillator high pivot: ta.pivothigh(osc, lookback, lookforward)
Oscillator low pivot: ta.pivotlow(osc, lookback, lookforward)
Store Recent Pivots :
Maintain arrays of last 10 pivots with bar indices
When new pivot confirmed, unshift to array, pop oldest if >10
Scan for Slope Disagreements :
Loop through last 5 pivots
For each pair (current pivot, historical pivot):
Check if within max_lookback bars
Calculate slopes: (current - historical) / bars_between
Regular bearish: price_slope > 0, osc_slope < 0, |osc_slope| > min_threshold
Regular bullish: price_slope < 0, osc_slope > 0, |osc_slope| > min_threshold
Hidden bearish: price_slope < 0, osc_slope > 0, osc_slope > min_threshold
Hidden bullish: price_slope > 0, osc_slope < 0, |osc_slope| > min_threshold
Important Disclaimers and Terms
Performance Disclosure
Past performance, whether backtested or live-traded, does not guarantee future results. Markets change. What works today may not work tomorrow. Hypothetical or simulated performance results have inherent limitations and do not represent actual trading.
Risk of Loss
Trading involves substantial risk of loss. Only trade with risk capital you can afford to lose entirely. The high degree of leverage often available in trading can work against you as well as for you. Leveraged trading may result in losses exceeding your initial deposit.
Not Financial Advice
BZ-CAE is an educational and analytical tool for technical analysis. It is not financial advice, investment advice, or a recommendation to buy or sell any security or instrument. All trading decisions are your sole responsibility. Consult a licensed financial advisor for advice specific to your circumstances.
Technical Indicator Limitations
BZ-CAE is a technical analysis tool based on price and volume data. It does not account for:
Fundamental analysis (earnings, economic data, financial health)
Market sentiment and positioning
Geopolitical events and news
Liquidity conditions and market microstructure changes
Regulatory changes or exchange rules
Integrate with broader analysis and strategy. Do not rely solely on technical indicators for trading decisions.
Repainting Acknowledgment
As disclosed throughout this documentation:
Realtime mode may repaint on forming bars before confirmation (by design for preview functionality)
Confirmed mode has zero repainting (fully validated pivots only)
Choose timing mode appropriate for your use case. Understand the tradeoffs.
Testing Recommendation
ALWAYS test on demo/paper accounts before committing real capital. Validate the indicator's behavior on your specific instruments and timeframes. Learn the system thoroughly in Advisory mode before using Filtering mode.
Learning Resources :
In-indicator tooltips (hover over setting names for detailed explanations)
This comprehensive publishing statement (save for reference)
User guide in script comments (top of code)
Final Word — Philosophy of BZ-CAE
BZ-CAE is not designed to replace your judgment — it's designed to enhance it.
The indicator identifies structural inflection points (bifurcations) where price and momentum disagree. The Cognitive Engine evaluates market state to determine if this disagreement is meaningful or noise. The Adversarial model debates both sides of the trade to catch obvious bad setups. The Confidence system ranks quality so you can choose your risk appetite.
But YOU still execute. YOU still manage risk. YOU still learn from outcomes.
This is intelligence amplification, not intelligence replacement.
Use Advisory mode to learn how expert traders evaluate market state. Use Filtering mode to enforce discipline when emotions run high. Use the dashboard to develop a systematic approach to reading markets. Use confidence scores to size positions probabilistically.
The system provides an edge. Your job is to execute that edge with discipline, patience, and proper risk management over hundreds of trades.
Markets are probabilistic. No system wins every trade. But a systematic edge + disciplined execution + proper risk management compounds over time. That's the path to consistent profitability. BZ-CAE gives you the edge. The discipline and risk management are on you.
Taking you to school. — Dskyz, Trade with insight. Trade with anticipation.
GMO (Gyroscopic Momentum Oscillator) GMO
Overview
This indicator fuses multiple advanced concepts to give traders a comprehensive view of market momentum, volatility, and potential turning points. It leverages the Gyroscopic Momentum Oscillator (GMO) foundation and layers on IQR-based bands, dynamic ATR-adjusted OB/OS levels, torque filtering, and divergence detection. The outcome is a versatile tool that can assist in identifying both short-term squeezes and long-term reversal zones while detecting subtle shifts in momentum acceleration.
Key Components:
Gyroscopic Momentum Oscillator (GMO) – A physics-inspired metric capturing trend stability and momentum by treating price dynamics as “angle,” “angular velocity,” and “inertia.”
IQR Bands – Highlight statistically typical oscillation ranges, providing insight into short-term squeezes and potential near-term trend shifts.
ATR-Adjusted OB/OS Levels – Dynamic thresholds for overbought/oversold conditions, adapting to volatility, aiding in identifying long-term potential reversal zones.
Torque Filtering & Scaling – Smooths and thresholds torque (the rate of change of momentum) and visually scales it for clarity, indicating sudden force changes that may precede volatility adjustments.
Divergence Detection – Highlights potential reversal cues by comparing oscillator swings against price swings, revealing regular and hidden bullish/bearish divergences.
Conceptual Insights
IQR Bands (Short-Term Squeeze & Trend Direction):
Short-Term Momentum and Squeeze: The IQR (Interquartile Range) bands show where the oscillator tends to “live” statistically. When the GMO line hovers within compressed IQR bands, it can signal a momentum squeeze phase. Exiting these tight ranges often correlates with short-term breakout opportunities.
Trend Reversals: If the oscillator pushes beyond these IQR ranges, it may indicate an emerging short-term trend change. Traders can watch for GMO escaping the IQR “comfort zone” to anticipate a new directional move.
Dynamic OB/OS Levels (Long-Term Reversal Zones):
ATR-Based Adaptive Thresholds: Instead of static overbought/oversold lines, this tool uses ATR to adjust OB/OS boundaries. In calm markets, these lines remain closer to ±90. As volatility rises, they approach ±100, reflecting greater permissible swings.
Long-Term Trend Reversal Potential: If GMO hits these dynamically adjusted OB/OS extremes, it suggests conditions ripe for possible long-term trend reversals. Traders seeking major inflection points may find these adaptive levels more reliable than fixed thresholds.
Torque (Sudden Force & Directional Shifts):
Momentum Acceleration Insight: Torque represents the second derivative of momentum, highlighting how quickly momentum is changing. High positive torque suggests a rapidly strengthening bullish force, while high negative torque warns of sudden bearish pressure.
Early Warning & Stability/Volatility Adjustments: By monitoring torque spikes, traders can anticipate momentum shifts before price fully confirms them. This can signal imminent changes in stability or increased volatility phases.
Indicator Parameters and Usage
GMO-Related Inputs:
lenPivot (Default 100): Length for calculating the pivot line (slow market axis).
lenSmoothAngle (Default 200): Smooths the angle measure, reducing noise.
lenATR (Default 14): ATR period for scaling factor, linking price changes to volatility.
useVolatility (Default true): If true, volatility (ATR) influences inertia, adjusting momentum calculations.
useVolume (Default false): If true, volume affects inertia, adding a liquidity dimension to momentum.
lenVolSmoothing (Default 50): Smooths volume calculations if useVolume is enabled.
lenMomentumSmooth (Default 20): EMA smoothing of GMO for a cleaner oscillator line.
normalizeRange (Default true): Normalizes GMO to a fixed range for consistent interpretation.
lenNorm (Default 100): Length for normalization window, ensuring GMO’s scale adapts to recent extremes.
IQR Bands Settings:
iqrLength (Default 14): Period to compute the oscillator’s statistical IQR.
iqrMult (Default 1.5): Multiplier to define the upper and lower IQR-based bands.
ATR-Adjusted OB/OS Settings:
baseOBLevel (Fixed at 90) and baseOSLevel (Fixed at 90): Base lines for OB/OS.
atrPeriodForOBOS (Default 50): ATR length for adjusting OB/OS thresholds dynamically.
atrScaling (Default 0.2): Controls how strongly volatility affects OB/OS lines.
Torque Filtering & Visualization:
torqueSmoothLength (Default 10): EMA length to smooth raw torque values.
atrPeriodForTorque (Default 14): ATR period to determine torque threshold.
atrTorqueScaling (Default 0.5): Scales ATR for determining torque’s “significant” threshold.
torqueScaleFactor (Default 10.0): Multiplies the torque values for better visual prominence on the chart.
Divergence Inputs:
showDivergences (Default true): Toggles divergence signals.
lbR, lbL (Defaults 5): Pivot lookback periods to identify swing highs and lows.
rangeUpper, rangeLower: Bar constraints to validate potential divergences.
plotBull, plotHiddenBull, plotBear, plotHiddenBear: Toggles for each divergence type.
Visual Elements on the Chart
GMO Line (Blue) & Zero Line (Gray):
GMO line oscillates around zero. Positive territory hints bullish momentum, negative suggests bearish.
IQR Bands (Teal Lines & Yellow Fill):
Upper/lower bands form a statistical “normal range” for GMO. The median line (purple) provides a central reference. Contraction near these bands indicates a short-term squeeze, expansions beyond them can signal emerging short-term trend changes.
Dynamic OB/OS (Red & Green Lines):
Red line near +90 to +100: Overbought zone (dynamic).
Green line near -90 to -100: Oversold zone (dynamic).
Movement into these zones may mark significant, longer-term reversal potential.
Torque Histogram (Colored Bars):
Plotted below GMO. Green bars = torque above positive threshold (bullish acceleration).
Red bars = torque below negative threshold (bearish acceleration).
Gray bars = neutral range.
This provides early warnings of momentum shifts before price responds fully.
Precession (Orange Line):
Scaled for visibility, adds context to long-term angular shifts in the oscillator.
Divergence Signals (Shapes):
Circles and offset lines highlight regular or hidden bullish/bearish divergences, offering potential reversal signals.
Practical Interpretation & Strategy
Short-Term Opportunities (IQR Focus):
If GMO compresses within IQR bands, the market might be “winding up.” A break above/below these bands can signal a short-term trade opportunity.
Long-Term Reversal Zones (Dynamic OB/OS):
When GMO approaches these dynamically adjusted extremes, conditions may be ripe for a major trend shift. This is particularly useful for swing or position traders looking for significant turnarounds.
Monitoring Torque for Acceleration Cues:
Torque spikes can precede price action, serving as an early catalyst signal. If torque turns strongly positive, anticipate bullish acceleration; strongly negative torque may warn of upcoming bearish pressure.
Confirm with Divergences:
Divergences between price and GMO reinforce potential reversal or continuation signals identified by IQR, OB/OS, or torque. Use them to increase confidence in setups.
Tips and Best Practices
Combine with Price & Volume Action:
While the indicator is powerful, always confirm signals with actual price structure, volume patterns, or other trend-following tools.
Adjust Lengths & Periods as Needed:
Shorter lengths = more responsiveness but more noise. Longer lengths = smoother signals but greater lag. Tune parameters to match your trading style and timeframe.
Use ATR and Volume Settings Wisely:
If markets are highly volatile, consider useVolatility to refine momentum readings. If liquidity is key, enable useVolume.
Scaling Torque:
If torque bars are hard to read, increase torqueScaleFactor further. The scaling doesn’t affect logic—only visibility.
Conclusion
The “GMO + IQR Bands + ATR-Adjusted OB/OS + Torque Filtering (Scaled)” indicator presents a holistic framework for understanding market momentum across multiple timescales and conditions. By interpreting short-term squeezes via IQR bands, long-term reversal zones via adaptive OB/OS, and subtle acceleration changes through torque, traders can gain advanced insights into when to anticipate breakouts, manage risk around potential reversals, and fine-tune timing for entries and exits.
This integrated approach helps navigate complex market dynamics, making it a valuable addition to any technical analysis toolkit.
Xtrender and TSI FusionXtrender and TSI Fusion Indicator
I created this indicator for myself. I was inspired by the indicators created by Bjorgum, Duyck and QuantTherapy and decided to create multiple indicators that either work well combined with their indicators or something new that applies some of their indicator concepts. I decided to share all of the indicator I have created because I believe in learning and earing together as a community. If you guys have any questions or suggestions write them.
Overview: The Xtrender and TSI Fusion Indicator is a powerful tool designed to help traders analyze market momentum, trends, and potential reversals. By combining Xtrender with the True Strength Index (TSI), this indicator provides a comprehensive view of market dynamics, making it easier to identify trading opportunities.
Image: Timeframe is set to daily
Features:
1.Xtrender Analysis:
Short-Term Xtrender: Visualizes short-term momentum using RSI-based calculations on EMA differences. This helps in identifying immediate market trends and pullbacks.
Image above: showcases Short-Term Xtrender
Xtrender T3: A smoothed version of the Xtrender that reduces noise and highlights significant trend changes.
Image above: showcases Xtrender T3 with Xtrender T3 color
2.TSI (True Strength Index):
TSI Value: Measures momentum by comparing price changes over two time periods, offering a clear view of trend strength.
TSI Signal Line: A smoothed version of the TSI value, used to generate buy and sell signals when crossed by the TSI.
Image: showcases TSI Value with TSI Signal Line
TSI Histogram: Shows the difference between the TSI and its signal line, highlighting potential reversals and trend continuations.
Image: showcases TSI Histogram
3.Color Coding and Visual Cues:
Trend Colors: The indicator uses dynamic colors to represent bullish or bearish conditions, making it easy to interpret market sentiment.
Background Color : The background changes color based on TSI signals, further aiding in visual trend analysis.
Image: showcases Background color and Zero line
How to Use
1.Xtrender Analysis:
Short-Term Xtrender: The short-term Xtrender is plotted as columns, changing color based on its direction and value. Green or lime indicates positive momentum, while red or maroon indicates negative momentum.
Xtrender T3: The Xtrender T3 line (black) represents a smoothed version of the short-term Xtrender, providing a clearer picture of the overall trend. The color of this line changes based on the Xtrender's value, helping you spot potential trend changes.
2.TSI (True Strength Index):
TSI Value and Signal Line: The TSI value is plotted as a line, with its color changing based on its relationship to the signal line. A crossover of the TSI above the signal line suggests a potential bullish move, while a crossover below indicates a bearish trend.
TSI Histogram: The histogram represents the difference between the TSI and its signal line. Positive values indicate bullish momentum, while negative values suggest bearish momentum.
3.Background Color:
The background color changes based on the TSI signal, with a greenish hue indicating bullish conditions and a reddish hue indicating bearish conditions. This provides a quick visual reference for market sentiment.
4.Zero Line:
A horizontal gray dotted line at the zero level helps you easily identify when the Xtrender or TSI crosses into positive or negative territory, signaling potential trend shifts.
Image above: Timeframe on daily with the individual elements combined
Example of Use:
•Trend Confirmation: Use the Xtrender and Xtrender T3 to confirm the direction of the trend. If both are aligned with the same color and direction, it increases the probability of a strong trend.
•Momentum Reversals: Watch for TSI crosses and histogram shifts to identify potential reversals. For example, a TSI crossover above its signal line with a corresponding change in the histogram from negative to positive could signal a buying opportunity.
•Pullbacks: Identify pullbacks within a trend by observing temporary shifts in the short-term Xtrender or TSI histogram. Use these signals to enter trades in the direction of the overall trend.
Image above: Showcases, Trend confirmation, reversal and pullbacks on daily timeframe.
Customization:
•TSI Speed: Choose between "Fast" and "Slow" TSI settings based on your trading style. Fast settings are more responsive to price changes, while slow settings offer smoother signals.
•Color Settings: Customize the colors for bullish, bearish, and neutral TSI conditions to match your personal preferences or chart theme.
This indicator is versatile and can be used for various trading strategies, from trend following to momentum trading, making it a valuable tool in any trader's arsenal.
My Scripts/Indicators/Ideas /Systems that I share are only for educational purposes
RSI ATR Range [SS]Hey everyone,
Over the course of the last year I had a bunch of requests to do something with RSI. I did do an RSI expected move plotter, but the requests were to overhaul RSI and make it better I guess.
So here is my attempt!
This is the RSI ATR plotter. Its similar to my RSI expected move plotter, however, it gives you the ATR ranges associated with the current RSI value. This allows you to conceptualize RSI in a different way. Instead of looking for "oversold" over "overbought", you can actually just see the expected high to open range and the expected open to low range based on the current RSI.
This will allow you to determine such things as:
a) Is it likely to be bullish?
b) Is it likely to be bearish?
c) The average move, in a dollar amount, associated with this RSI.
In addition to presenting RSI in terms of ranges as opposed to the actual RSI value, the indicator will also signal likely reversal areas. Whenever there is a huge spike in RSI and range, whether it be up or down, this generally corresponds to an imminent reversal. The indicator is programmed to recognize this and plot little grey circles to notify you of an impending reversal.
Let's take a look at some reversal examples using NVDA:
In the chart above, we can see that the RSI signaled a reversal. As it was part of a downtrend, the reversal was bullish.
Let's look at a top reversal:
The chart above shows a likely downside reversal.
And some little bounce reversals here and there:
In addition to showing you the ATR range and reversals, the indicator will show you the RSI in a bar graph format:
You won't be able to look for RSI divergences, if you are a believer of those. However, you can definitely visualize them in the ATR ranges which are directly affected by the RSI readings.
Aspects of the indicator:
Bull ranges are displayed in green.
Bear ranges are displayed in red.
When green is present we know its entering or currently in a bullish RSI range:
Inversely, when it starts to shift red, we know we are entering a bearish RSI range:
There is a border that circles the range. It will be green when we are in a bullish range and red when we are in a bearish range. In addition to these 2 signals, the RSI bar chart itself will turn green in bullish ranges, and red in bearish ranges.
Here is bullish:
Here is bearish:
Customizability
You can customize the Source input for the RSI (default is close). As well as the length (default is 14).
The ATR length is defaulted to 500. My suggestion is to leave this be. You can increase it but I would not suggest decreasing it as it may omit some of the RSI ranges from its history.
And that is the indicator my friends! Hope you enjoy!
As always, safe trades!
RVol LabelThis Code is update version of Code Provided by @ssbukam, Here is Link to his original Code and review the Description
Below is Original Description
1. When chart resolution is Daily or Intraday (D, 4H, 1H, 5min, etc), Relative Volume shows value based on DAILY. RVol is measured on daily basis to compare past N number of days.
2. When resolution is changed to Weekly or Monthly, then Relative Volume shows corresponding value. i.e. Weekly shows weekly relative volume of this week compared to past 'N' weeks. Likewise for Monthly. You would see change in label name. Like, Weekly chart shows W_RVol (Weekly Relative Volume). Likewise, Daily & Intraday shows D_RVol. Monthly shows M_RVol (Monthly Relative Volume).
3. Added a plot (by default hidden) for this specific reason: When you move the cursor to focus specific candle, then Indicator Value displays relative volume of that specific candle. This applies to Intraday as well. So if you're in 1HR chart and move the cursor to a specific candle, Indicator Value shows relative volume for that specific candlestick bar.
4. Updating the script so that text size and location can be customized.
Changes to Updated Label by me
1. Added Today's Volume to the Label
2. Added Total Average Volume to the Label
3. Comparison vs Both in Single Line and showing how much volume has traded vs the average volume for that time of the day
4. Aesthetic Look of the Label
How to Use Relative Volume for Trading
Using Relative Volume (RVol) in trading can be a valuable tool to help you identify potential trading opportunities and gain insight into market behavior. Here are some ways to use RVol in your trading strategy:
Identifying High-Volume Breakouts: RVol can help you spot potential breakouts when the volume surges significantly above its average. High RVol during a breakout suggests strong market interest, increasing the probability of a sustained move in the direction of the breakout.
Confirming Trends and Reversals: RVol can act as a confirmation tool for trends and reversals. A trend accompanied by rising RVol indicates a strong and sustainable move. Conversely, a trend with declining RVol might suggest a weakening trend or potential reversal.
Spotting Volume Divergence: When the price is moving in one direction, but RVol is declining or not confirming the move, it may indicate a divergence. This discrepancy could suggest a potential reversal or trend change.
Support and Resistance Confirmation: High RVol near key support or resistance levels can indicate potential price reactions at those levels. This confirmation can be valuable in determining whether a level is likely to hold or break.
Filtering Trade Signals: Incorporate RVol into your existing trading strategy as a filter. For example, you might consider taking trades only if RVol is above a certain threshold, ensuring that you focus on high-impact trading opportunities.
Avoiding Low-Volume Traps: Low RVol can indicate a lack of interest or participation in the market. In such situations, price movements may be erratic and less reliable, so it's often wise to avoid trading during low RVol periods.
Monitoring News Events: Around significant news events or earnings releases, RVol can help you gauge the market's reaction to the information. High RVol during such events can present trading opportunities but be cautious of increased volatility and potential gaps.
Adjusting Trade Size: During periods of extremely high RVol, it might be prudent to adjust your position size to account for higher risk.
Using Relative Volume in Morning Session
If the Volume traded in first 15 minute to 30 Minutes is already at 50% or 100% depending upon the ticker, it means that it is going to have very high Volume vs average by end of the day.
This gives me conviction for Long or Short Trades
Remember that RVol is not a standalone indicator; it works best when used in conjunction with other technical and fundamental analysis tools. Additionally, RVol's effectiveness may vary across different markets and trading strategies. Therefore, backtesting and validating the use of RVol in your trading approach is essential.
Lastly, risk management is crucial in trading. While RVol can provide valuable insights, it cannot guarantee profitable trades. Always use appropriate risk management strategies, such as setting stop-loss levels, and avoid overexposing yourself to the market based solely on RVol readings.
Multi-Timeframe PSAR Indicator ver 1.0Enhance your trend analysis with the Multi-Timeframe Parabolic SAR (MTF PSAR) indicator! This powerful tool displays the Parabolic SAR (Stop and Reverse) from both the current chart's timeframe and a higher timeframe, all in one convenient view. Identify potential trend reversals and set dynamic trailing stops with greater confidence by understanding the broader market context.
Key Features:
Dual Timeframe Analysis: Simultaneously visualize the PSAR on your current chart and a user-defined higher timeframe (e.g., see the Daily PSAR while trading on the 1-hour chart). This helps you align your trades with the dominant trend.
Customizable PSAR Settings: Fine-tune the PSAR calculation with adjustable Start, Increment, and Maximum values. Optimize the indicator's sensitivity to match your trading style and the volatility of the asset.
Independent Timeframe Control: Choose to display either or both the current timeframe PSAR and the higher timeframe PSAR. Focus on the information most relevant to your analysis.
Clear Visual Representation: Distinct colors for the current and higher timeframe PSAR dots make it easy to differentiate between the two. Quickly identify potential entry and exit points.
Configurable Colors You can easily change colors of Current and HTF PSAR.
Standard PSAR Logic: Uses the classic Parabolic SAR algorithm, providing a reliable and widely-understood trend-following indicator.
lookahead=barmerge.lookahead_off used in the security function, there is no data leak or repainting.
Benefits:
Improved Trend Identification: Spot potential trend changes earlier by observing divergences between the current and higher timeframe PSAR.
Enhanced Risk Management: Use the PSAR as a dynamic trailing stop-loss to protect profits and limit potential losses.
Greater Trading Confidence: Make more informed decisions by considering the broader market trend.
Reduced Chart Clutter: Avoid the need to switch between multiple charts to analyze different timeframes.
Versatile Application: Suitable for various trading styles (swing trading, day trading, trend following) and markets (stocks, forex, crypto, etc.).
How to Use:
Add to Chart: Add the "Multi-Timeframe PSAR" indicator to your TradingView chart.
Configure Settings:
PSAR Settings: Adjust the Start, Increment, and Maximum values to control the PSAR's sensitivity.
Multi-Timeframe Settings: Select the desired "Higher Timeframe PSAR" resolution (e.g., "D" for Daily). Enable or disable the display of the current and/or higher timeframe PSAR using the checkboxes.
Interpret Signals:
Current Timeframe PSAR: Dots below the price suggest an uptrend; dots above the price suggest a downtrend.
Higher Timeframe PSAR: Provides context for the overall trend. Agreement between the current and higher timeframe PSAR strengthens the trend signal. Divergences may indicate potential reversals.
Trade Management:
Use PSAR dots as dynamic trailing stop.
Example Use Cases:
Confirming Trend Strength: A trader on a 1-hour chart sees the 1-hour PSAR flip bullish (dots below the price). They check the MTF PSAR and see that the Daily PSAR is also bullish, confirming the strength of the uptrend.
Identifying Potential Reversals: A trader sees the current timeframe PSAR flip bearish, but the higher timeframe PSAR remains bullish. This divergence could signal a potential pullback within a larger uptrend, or a warning of a more significant reversal.
Trailing Stops: A trader enters a long position and uses the current timeframe PSAR as a trailing stop, moving their stop-loss up as the PSAR dots rise.
Disclaimer: The Parabolic SAR is a lagging indicator and may produce false signals, especially in ranging markets. It is recommended to use this indicator in conjunction with other technical analysis tools and risk management strategies. Past performance is not indicative of future results.
RSI Divergence + Sweep + Signal + Alerts Toolkit [TrendX_]The RSI Toolkit is a powerful set of tools designed to enhance the functionality of the traditional Relative Strength Index (RSI) indicator. By integrating advanced features such as Moving Averages, Divergences, and Sweeps, it helps traders identify key market dynamics, potential reversals, and newly-approach trading stragies.
The toolkit expands on standard RSI usage by incorporating features from smart money concepts (Just try to be creative 🤣 Hope you like it), providing a deeper understanding of momentum, liquidity sweeps, and trend reversals. It is suitable for RSI traders who want to make more informed and effective trading decisions.
💎 FEATURES
RSI Moving Average
The RSI Moving Average (RSI MA) is the moving average of the RSI itself. It can be customized to use various types of moving averages, including Simple Moving Average (SMA), Exponential Moving Average (EMA), Relative Moving Average (RMA), and Volume-Weighted Moving Average (VWMA).
The RSI MA smooths out the RSI fluctuations, making it easier to identify trends and crossovers. It helps traders spot momentum shifts and potential entry/exit points by observing when the RSI crosses above or below its moving average.
RSI Divergence
RSI Divergence identifies discrepancies between price action and RSI momentum. There are two types of divergences: Regular Divergence - Indicates a potential trend reversal; Hidden Divergence - Suggests the continuation of the current trend.
Divergence is a critical signal for spotting weakness or strength in a trend. Regular divergence highlights potential trend reversals, while hidden divergence confirms trend continuation, offering traders valuable insights into market momentum and possible trade setups.
RSI Sweep
RSI Sweep detects moments when the RSI removes liquidity from a trend structure by sweeping above or below the price at key momentum level crossing. These sweeps are overlaid on the RSI chart for easier visualized.
RSI Sweeps are significant because they indicate potential turning points in the market. When RSI sweeps occur: In an uptrend - they suggest buyers' momentum has peaked, possibly leading to a reversal; In a downtrend - they indicate sellers’ momentum has peaked, also hinting at a reversal.
(Note: This feature incorporates Liquidity Sweep concepts from Smart Money Concepts into RSI analysis, helping RSI traders identify areas where liquidity has been removed, which often precedes a trend reversal)
🔎 BREAKDOWN
RSI Moving Average
How MA created: The RSI value is calculated first using the standard RSI formula. The MA is then applied to the RSI values using the trader’s chosen type of MA (SMA, EMA, RMA, or VWMA). The flexibility to choose the type of MA allows traders to adjust the smoothing effect based on their trading style.
Why use MA: RSI by itself can be noisy and difficult to interpret in volatile markets. Applying moving average would provide a smoother, more reliable view of RSI trends.
RSI Divergence
How Regular Divergence created: Regular Divergence is detected when price forms HIGHER highs while RSI forms LOWER highs (bearish divergence) or when price forms LOWER lows while RSI forms HIGHER lows (bullish divergence).
How Hidden Divergence created: Hidden Divergence is identified when price forms HIGHER lows while RSI forms LOWER lows (bullish hidden divergence) or when price forms LOWER highs while RSI forms HIGHER highs (bearish hidden divergence).
Why use Divergence: Divergences provide early warning signals of a potential trend change. Regular divergence helps traders anticipate reversals, while hidden divergence supports trend continuation, enabling traders to align their trades with market momentum.
RSI Sweep
How Sweep created: Trend Structure Shift are identified based on the RSI crossing key momentum level of 50. To track these sweeps, the indicator pinpoints moments when liquidity is removed from the Trend Structure Shift. This is a direct application of Liquidity Sweep concepts used in Smart Money theories, adapted to RSI.
Why use Sweep: RSI Sweeps are created to help traders detect potential trend reversals. By identifying areas where momentum has exhausted during a certain trend direction, the indicator highlights opportunities for traders to enter trades early in a reversal or continuation phase.
⚙️ USAGES
Divergence + Sweep
This is an example of combining Devergence & Sweep in BTCUSDT (1 hour)
Wait for a divergence (regular or hidden) to form on the RSI. After the divergence is complete, look for a sweep to occur. A potential entry might be formed at the end of the sweep.
Divergences indicate a potential trend change, but confirmation is required to ensure the setup is valid. The RSI Sweep provides that confirmation by signaling a liquidity event, increasing the likelihood of a successful trade.
Sweep + MA Cross
This is an example of combining Devergence & Sweep in BTCUSDT (1 hour)
Wait for an RSI Sweep to form then a potential entry might be formed when the RSI crosses its MA.
The RSI Sweep highlights a potential turning point in the market. The MA cross serves as additional confirmation that momentum has shifted, providing a more reliable and more potential entry signal for trend continuations.
DISCLAIMER
This indicator is not financial advice, it can only help traders make better decisions. There are many factors and uncertainties that can affect the outcome of any endeavor, and no one can guarantee or predict with certainty what will occur. Therefore, one should always exercise caution and judgment when making decisions based on past performance.
Sash Trending Suite NEWWhy
The " Sash Trending Suite " (STS) indicator simplifies trading by highlighting market trends and potential reversals. In a world of complex charts and overwhelming data, STS helps traders quickly understand market direction and make informed decisions.
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How and What
STS combines key technical tools into one easy-to-read indicator, directly showing important signals on the chart:
Macro Trend Detection
How : Uses two EMAs (fast and slow) and the ADX to identify strong bullish or bearish trends.
What to Look For :
Bar Colors :
Green Bars : Indicate a strong upward (bullish) trend.
Red Bars : Indicate a strong downward (bearish) trend.
Benefit : Quickly see the overall market direction.
Alpha Track Line
How : An adaptive EMA that acts as a dynamic support or resistance line.
What to Look For :
Line Colors :
Green Line : Price is above the line (bullish momentum).
Red Line : Price is below the line (bearish momentum).
Benefit : Visualize momentum shifts easily.
Reversal Signals
How : Combines RSI with price action to spot potential market reversals.
What to Look For :
"R" Labels :
Turquoise "R" Below Bar : Potential bullish reversal.
Amber "R" Above Bar : Potential bearish reversal.
Benefit : Identify possible turning points for entry or exit.
Micro Trend Detection
How : Uses shorter EMAs to catch minor trend changes.
What to Look For :
Small Circles :
Green Circle Below Bar : Micro bullish signal.
Red Circle Above Bar : Micro bearish signal.
Benefit : Spot short-term trend shifts promptly.
Alerts
How : Built-in alerts notify you of key events.
What to Expect :
Trend Changes : Alerts when a new bullish or bearish trend starts.
Reversals : Alerts for potential bullish or bearish reversals.
Benefit : Stay updated without constantly watching the chart.
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Summary
The "Sash Trending Suite" provides:
Simplified Analysis : One indicator shows trend direction, momentum, reversals, and micro trends.
Clear Visuals : Color-coded bars and symbols make interpretation easy.
Timely Alerts : Know about important market changes instantly.
By focusing on essential signals and displaying them clearly, STS helps traders navigate the market with confidence and simplicity.
Consecutive Beta with Dynamic Support Resistance [TrendX_]The Consecutive Beta with Dynamic Support Resistance indicator is tailored to harness trend momentum, recognize top & bottom reversals, and leverage dynamic support and resistance levels. This indicator introduces a new approach by combining the concepts of beta, consecutive counting mechanisms, and the supertrend structure, making it a fresh tool for understanding market trends and patterns.
💎 KEY FEATURES
Candle’s Relative Valuation Using Beta: The core of the TrendX indicator lies in using beta to gauge volatility. Beta serves as a measure of how an asset moves relative to the broader market, helping traders understand whether the asset is more or less volatile in different market conditions.
Counting Techniques for Momentum & Reversals: By employing counting techniques to reach a significant threshold, the indicator can measure trend momentum and spot top/bottom reversals.
Dynamic Support & Resistance: This feature relies on consecutive beta counting to dynamically adapt support and resistance levels. These levels are key in predicting potential entry and exit points following the general trend direction.
⚙️ USAGES
Initial Start and Distance: Customize the initial start point and distance for better control over trading strategies. For instance, starting at 1 and using an even distance of 2 will yield odd consecutive counting series;
Phase 1 Completion for Reversal Strategies: This initial phase focuses on identifying short-term reversals;
Phase 2 Completion for Support/Resistance: A support level forms after completing two bullish phases, while a resistance level forms after completing two bearish phases. This structure helps in clarifying trend directions when breakout these key levels.
🔎 BREAKDOWN
Phase 1:
The indicator counts consecutive candles that show a higher Beta than in previous periods over a given length. The completion of countings only succeed when the whole series is uninterruptedly counted, or else countings will be canceled. This strict adherence to consecutive counts serves to ensure that only strong, sustained momentum is recognized and also helps filter out noise, weak signals and establish the initial direction catalyst, setting up for further trend analysis.
Phase 2:
After Phase 1 ends, the Phase 2 counting mechanism begins. This phase focuses on bottom reversals through consecutive higher beta candles, and top reversals by counting lower beta candles. At this stage, interuptions will not cancel the counting process. The ability to continue counting in Phase 2 allows for a broader perspective on market behavior. Even if individual candles do not consistently meet the criteria for consecutive counts, the cumulative effect of higher or lower beta readings over time provides valuable insights into market sentiment and trend direction.
Dynamic Support & Resistance:
After Phase 2 completion, if the average of high, low, and close surpasses both recent support and resistance levels from Phase 2, an uptrend is confirmed, which the support level is displayed. If it drops below these levels, a downtrend is indicated, where resistance is displayed instead of support. The result is displayed through a colored supertrend-line (teal for uptrend, red for downtrend).
DISCLAIMER
This indicator is not financial advice, it can only help traders make better decisions. There are many factors and uncertainties that can affect the outcome of any endeavor, and no one can guarantee or predict with certainty what will occur. Therefore, one should always exercise caution and judgment when making decisions based on past performance.
Enhanced Overbought/Oversold IndicatorEnhanced Overbought/Oversold Indicator
Description:
The Enhanced Overbought/Oversold Indicator is a custom technical analysis tool designed to identify potential reversal points in the market by highlighting conditions of overbought and oversold levels on any timeframe. This indicator is based on the Relative Strength Index (RSI), a momentum oscillator that measures the speed and change of price movements.
Features:
Overbought & Oversold Levels:
Overbought (RSI > 70): Indicates that the market is potentially overvalued and might be due for a pullback. The candles are highlighted in Red to signal caution.
Oversold (RSI < 30): Indicates that the market is potentially undervalued and might be due for a bounce. The candles are highlighted in Green to signal potential buying opportunities.
Extreme Conditions:
Extreme Overbought (RSI > 85): Indicates an extremely overbought condition, suggesting a very high likelihood of a reversal or correction. The candles are highlighted in Blue.
Extreme Oversold (RSI < 15): Indicates an extremely oversold condition, suggesting a strong potential for a reversal upwards. The candles are highlighted in Yellow.
Dynamic Highlighting:
The indicator dynamically adjusts the candle colors based on the current RSI value, providing a clear visual representation of market conditions.
Applications:
Trend Reversals: By identifying extreme RSI levels, the indicator helps traders anticipate possible trend reversals.
Entry & Exit Points: Traders can use the highlighted signals to make more informed decisions about entering or exiting trades.
Risk Management: The color-coded signals can be used to manage risk, especially during extreme market conditions.
This indicator is particularly useful for traders looking for a straightforward visual representation of market conditions across different timeframes. By combining standard and extreme RSI levels, it helps identify not just overbought and oversold conditions but also extreme levels where significant reversals are more likely.
Uptrick: DPO Signal & Zone Indicator
## **Uptrick: DPO Signal & Zone Indicator**
### **Introduction:**
The **Uptrick: DPO Signal & Zone Indicator** is a sophisticated technical analysis tool tailored to provide insights into market momentum, identify potential trading signals, and recognize extreme market conditions. It leverages the Detrended Price Oscillator (DPO) to strip out long-term trends from price movements, allowing traders to focus on short-term fluctuations and cyclical behavior. The indicator integrates multiple components, including a Detrended Price Oscillator, a Signal Line, a Histogram, and customizable alert levels, to deliver a robust framework for market analysis and trading decision-making.
### **Detailed Breakdown:**
#### **1. Detrended Price Oscillator (DPO):**
- **Purpose and Functionality:**
- The DPO is designed to filter out long-term trends from the price data, isolating short-term price movements. This helps in understanding the cyclical patterns and momentum of an asset, allowing traders to detect periods of acceleration or deceleration that might be overlooked when focusing solely on long-term trends.
- **Calculation:**
- **Formula:** `dpo = close - ta.sma(close, smaLength)`
- **`close`:** The asset’s closing price for each period in the dataset.
- **`ta.sma(close, smaLength)`:** The Simple Moving Average (SMA) of the closing prices over a period defined by `smaLength`.
- The DPO is derived by subtracting the SMA value from the current closing price. This calculation reveals how much the current price deviates from the moving average, effectively detrending the price data.
- **Interpretation:**
- **Positive DPO Values:** Indicate that the current price is higher than the moving average, suggesting bullish market conditions and a potential upward trend.
- **Negative DPO Values:** Indicate that the current price is lower than the moving average, suggesting bearish market conditions and a potential downward trend.
- **Magnitude of DPO:** Reflects the strength of momentum. Larger positive or negative values suggest stronger momentum in the respective direction.
#### **2. Signal Line:**
- **Purpose and Functionality:**
- The Signal Line is a smoothed average of the DPO, intended to act as a reference point for generating trading signals. It helps to filter out short-term fluctuations and provides a clearer perspective on the prevailing trend.
- **Calculation:**
- **Formula:** `signalLine = ta.sma(dpo, signalLength)`
- **`ta.sma(dpo, signalLength)`:** The SMA of the DPO values over a period defined by `signalLength`.
- The Signal Line is calculated by applying a moving average to the DPO values. This smoothing process reduces noise and highlights the underlying trend direction.
- **Interpretation:**
- **DPO Crossing Above Signal Line:** Generates a buy signal, suggesting that short-term momentum is turning bullish relative to the longer-term trend.
- **DPO Crossing Below Signal Line:** Generates a sell signal, suggesting that short-term momentum is turning bearish relative to the longer-term trend.
- **Signal Line’s Role:** Provides a benchmark for assessing the strength of the DPO. The interaction between the DPO and the Signal Line offers actionable insights into potential entry or exit points.
#### **3. Histogram:**
- **Purpose and Functionality:**
- The Histogram visualizes the difference between the DPO and the Signal Line. It provides a graphical representation of momentum strength and direction, allowing traders to quickly gauge market conditions.
- **Calculation:**
- **Formula:** `histogram = dpo - signalLine`
- The Histogram is computed by subtracting the Signal Line value from the DPO value. Positive values indicate that the DPO is above the Signal Line, while negative values indicate that the DPO is below the Signal Line.
- **Interpretation:**
- **Color Coding:**
- **Green Bars:** Represent positive values, indicating bullish momentum.
- **Red Bars:** Represent negative values, indicating bearish momentum.
- **Width of Bars:** Indicates the strength of momentum. Wider bars signify stronger momentum, while narrower bars suggest weaker momentum.
- **Zero Line:** A horizontal gray line that separates positive and negative histogram values. Crosses of the histogram through this zero line can signal shifts in momentum direction.
#### **4. Alert Levels:**
- **Purpose and Functionality:**
- Alert levels define specific thresholds to identify extreme market conditions, such as overbought and oversold states. These levels help traders recognize potential reversal points and extreme market conditions.
- **Inputs:**
- **`alertLevel1`:** Defines the upper threshold for identifying overbought conditions.
- **Default Value:** 0.5
- **`alertLevel2`:** Defines the lower threshold for identifying oversold conditions.
- **Default Value:** -0.5
- **Interpretation:**
- **Overbought Condition:** When the DPO exceeds `alertLevel1`, indicating that the market may be overbought. This condition suggests that the asset could be due for a correction or reversal.
- **Oversold Condition:** When the DPO falls below `alertLevel2`, indicating that the market may be oversold. This condition suggests that the asset could be poised for a rebound or reversal.
#### **5. Visual Elements:**
- **DPO and Signal Line Plots:**
- **DPO Plot:**
- **Color:** Blue
- **Width:** 2 pixels
- **Purpose:** To visually represent the deviation of the current price from the moving average.
- **Signal Line Plot:**
- **Color:** Red
- **Width:** 1 pixel
- **Purpose:** To provide a smoothed reference for the DPO and generate trading signals.
- **Histogram Plot:**
- **Color Coding:**
- **Green:** For positive values, signaling bullish momentum.
- **Red:** For negative values, signaling bearish momentum.
- **Style:** Histogram bars are displayed with varying width to represent the strength of momentum.
- **Zero Line:** A gray horizontal line separating positive and negative histogram values.
- **Overbought/Oversold Zones:**
- **Background Colors:**
- **Green Shading:** Applied when the DPO exceeds `alertLevel1`, indicating an overbought condition.
- **Red Shading:** Applied when the DPO falls below `alertLevel2`, indicating an oversold condition.
- **Horizontal Lines:**
- **Dotted Green Line:** At `alertLevel1`, marking the upper alert threshold.
- **Dotted Red Line:** At `alertLevel2`, marking the lower alert threshold.
- **Purpose:** To provide clear visual cues for extreme market conditions, aiding in the identification of potential reversal points.
#### **6. Trading Signals and Alerts:**
- **Buy Signal:**
- **Trigger:** When the DPO crosses above the Signal Line.
- **Visual Representation:** A "BUY" label appears below the price bar in the specified buy color.
- **Purpose:** Indicates a potential buying opportunity as short-term momentum turns bullish.
- **Sell Signal:**
- **Trigger:** When the DPO crosses below the Signal Line.
- **Visual Representation:** A "SELL" label appears above the price bar in the specified sell color.
- **Purpose:** Indicates a potential selling opportunity as short-term momentum turns bearish.
- **Overbought/Oversold Alerts:**
- **Overbought Alert:** Triggered when the DPO crosses below `alertLevel1`.
- **Oversold Alert:** Triggered when the DPO crosses above `alertLevel2`.
- **Visual Representation:** Labels "OVERBOUGHT" and "OVERSOLD" appear with distinctive colors and sizes to highlight extreme conditions.
- **Purpose:** To signal potential reversal points and extreme market conditions that may lead to price corrections or trend reversals.
- **Alert Conditions:**
- **DPO Cross Above Signal Line:** Alerts traders when the DPO crosses above the Signal Line, generating a buy signal.
- **DPO Cross Below Signal Line:** Alerts traders when the DPO crosses below the Signal Line, generating a sell signal.
- **DPO Above Upper Alert Level:** Alerts when the DPO is above `alertLevel1`, indicating an overbought condition.
- **DPO Below Lower Alert Level:** Alerts when the DPO is below `alertLevel2`, indicating an oversold condition.
- **Purpose:** To provide real-time notifications of significant market events, enabling traders to make informed decisions promptly.
### **Practical Applications:**
#### **1. Trend Following Strategies:**
- **Objective:**
- To capture and ride the prevailing market trends by entering trades that align with the direction of the momentum.
- **How to Use:**
- Monitor buy and sell signals generated by the DPO crossing the Signal Line. A buy signal suggests a bullish trend and a potential long trade, while a sell signal suggests a bearish trend and a potential short trade.
- Use the Histogram to confirm the strength of the trend. Expanding green bars indicate strong bullish momentum, while expanding red bars indicate strong bearish momentum.
- **Advantages:**
- Helps traders stay aligned with the market trend, increasing the likelihood of capturing substantial price moves.
#### **2. Reversal Trading:**
- **Objective:**
- To identify potential market reversals
by detecting overbought and oversold conditions.
- **How to Use:**
- Look for overbought and oversold signals based on the DPO crossing `alertLevel1` and `alertLevel2`. These conditions suggest that the market may be due for a reversal.
- Confirm reversal signals with the Histogram. A decrease in histogram bars (from green to red or vice versa) may support the reversal hypothesis.
- **Advantages:**
- Provides early warnings of potential market reversals, allowing traders to position themselves before significant price changes occur.
#### **3. Momentum Analysis:**
- **Objective:**
- To gauge the strength and direction of market momentum for making informed trading decisions.
- **How to Use:**
- Analyze the Histogram to assess momentum strength. Positive and expanding histogram bars indicate increasing bullish momentum, while negative and expanding bars suggest increasing bearish momentum.
- Use momentum insights to validate or question existing trading positions and strategies.
- **Advantages:**
- Offers valuable information about the market's momentum, helping traders confirm the validity of trends and trading signals.
### **Customization and Flexibility:**
The **Uptrick: DPO Signal & Zone Indicator** offers extensive customization options to accommodate diverse trading preferences and market conditions:
- **SMA Length and Signal Line Length:**
- Adjust the `smaLength` and `signalLength` parameters to control the sensitivity and responsiveness of the DPO and Signal Line. Shorter lengths make the indicator more responsive to price changes, while longer lengths provide smoother, less volatile signals.
- **Alert Levels:**
- Modify `alertLevel1` and `alertLevel2` to fit varying market conditions and volatility. Setting these levels appropriately helps tailor the indicator to different asset classes and trading strategies.
- **Color and Shape Customization:**
- Customize the colors and sizes of buy/sell signals, histogram bars, and alert levels to enhance visual clarity and align with personal preferences. This customization helps ensure that the indicator integrates seamlessly with a trader's charting setup.
### **Conclusion:**
The **Uptrick: DPO Signal & Zone Indicator** is a multifaceted analytical tool that combines the power of the Detrended Price Oscillator with customizable visual elements and alert levels to deliver a comprehensive approach to market analysis. By offering insights into momentum strength, trend direction, and potential reversal points, this indicator equips traders with valuable information to make informed decisions and enhance their trading strategies. Its flexibility and customization options ensure that it can be adapted to various trading styles and market conditions, making it a versatile addition to any trader's toolkit.
Trend and RSI Bias FusionTrend and RSI Bias Fusion Indicator
This is my first ever indicator. I created this indicator for myself. I was inspired by the indicators created by Bjorgum, Duyck and QuantTherapy and decided to create multiple indicators that either work well combined with their indicators or something new that applies some of their indicator concepts. I decided to share this because I believe in learning and earing together as a community. I will later share the rest of the indicators I have created. This is my first time ever sharing any indicator so if you guys have any questions or suggestions write them.
Overview
The "Trend and RSI Bias Fusion" indicator is a versatile tool designed to help traders identify key market trends, potential reversals, momentum shifts, and RSI-based pullbacks. This indicator fuses trend analysis and RSI bias into a single, comprehensive visual, making it easier to make informed trading decisions across various timeframes and market conditions.
Features
Dual Timeframe Analysis: Combines trend analysis on a higher timeframe (e.g., Daily) with RSI analysis on a lower timeframe (e.g., 4-Hour), providing a more granular view of market conditions. You can, however, choose any timeframe you want for instance 12hr with trend and 2hr RSI analysis.
Trend and Momentum Visualization: The indicator uses Exponential Moving Averages (EMAs) to determine trend direction and colors the chart background to reflect bullish or bearish trends, along with momentum strength.
RSI Bias Detection: Automatically identifies overbought and oversold conditions using the RSI, providing a clear indication of potential market reversals or continuations.
Color-Coded Bars: Optionally color codes bars based on either trend direction or RSI bias, giving you a quick visual cue of the market's state.
Reversal Markers: Displays trend reversal markers on the chart when the short-term EMA crosses over or under the long-term EMA.
Calculation Details
Exponential Moving Averages (EMAs): The indicator calculates short-term and long-term EMAs using the closing prices.
The crossover between these EMAs is used to determine the trend direction:
Short-Term EMA: Typically a 14-period EMA.
Long-Term EMA: Typically a 50-period EMA.
Momentum: Calculated using the RSI and then centered around zero by subtracting 50. This allows the indicator to distinguish between positive and negative momentum.
RSI Bias: The RSI is calculated on a lower timeframe to detect overbought (above 60) and oversold (below 40) conditions, which are used to determine the bias:
RSI Above 60: Indicates potential overbought conditions (bearish bias).
RSI Below 40: Indicates potential oversold conditions (bullish bias).
How to Use the Indicator
Select Your Timeframes: Choose your preferred trend timeframe (e.g., Daily) and RSI timeframe (e.g., 4-2 Hour) in the indicator settings. These should match your trading strategy and the asset class you're analyzing.
Interpret Trend and Momentum
Background Color: The background color reflects the current trend direction:
Green/Lime: Uptrend, with lime indicating positive momentum.
Red/Maroon: Downtrend, with maroon indicating positive momentum within a downtrend.
Momentum Histogram: The histogram plot shows momentum, color-coded by the trend. A histogram above zero with green/lime indicates bullish momentum, while below zero with red/maroon indicates bearish momentum.
Image above: Both RSI and Trend are set to daily, uses RSI bar color
Read RSI Bias:
The RSI bias line helps identify the current market state relative to overbought or oversold levels. The RSI value is plotted on the chart, with lines at 60 and 40 to mark these levels.
When the RSI crosses above 60, it suggests a bearish bias; crossing below 40 suggests a bullish bias.
Use Reversal Markers: The indicator places small circles on the chart at points where the short-term EMA crosses the long-term EMA, signaling potential trend reversals.
Bar Color Customization:
You can choose to color the bars based on either the trend or the RSI bias in the indicator settings. In the Images below I have changed the colors to fit my personal style , Blue for uptrend and Pink for downtrend:
Trend-Based: Bars will reflect the trend direction (green for uptrend or in this case blue, red for downtrend or in this case pink).
RSI-Based: Bars will reflect RSI conditions (yellow for overbought, maroon for oversold).
Image above: RSI is set to 4hr and Trend is set to daily, uses RSI bar color
Image above: RSI is set to 4hr and Trend is set to daily, uses Trend bar color
Image above: Both RSI and Trend are set to daily, uses RSI bar color
Image above: Both RSI and Trend are set to daily, uses Trend bar color
Image above: Both RSI and Trend are set to daily, without bar color
Image above: Both RSI and Trend are set to daily, how it looks on a clean chart
Example Use Case Swing Traders:
For instance, if you're trading a 4-hour chart of USDCHF:
Set the trend timeframe to Daily and the RSI timeframe to 4-Hour.
Watch for background color shifts and reversal markers to determine trend direction.
Use RSI bias to time your entries and exits, especially around overbought/oversold levels.
Enable bar coloring to quickly see when conditions favor either trend continuation or reversal.
This indicator is particularly effective for swing traders and those who want to align their trades with higher timeframe trends while using momentum and RSI for entry and exit signals.
For Day Traders
Timeframe Selection:
Trend Timeframe: Set to a higher intraday timeframe such as the 1 or 2 Hour chart.
RSI Timeframe: Set to a shorter timeframe like 15-10 Minutes or 5-Minutes to capture finer details of intraday momentum shifts.
Using the Indicator:
Trend Identification: Day traders can use the background color to quickly identify whether the market is in a bullish or bearish trend on the 1-Hour chart. A green background suggests looking for long opportunities, while a red background suggests short opportunities.
Momentum Analysis: The histogram can help day traders gauge the strength of the current trend. For example, if the histogram is green and above zero, the trader may consider buying pullbacks within the trend.
RSI Bias: Monitor RSI levels on the lower timeframe (e.g., 15-Minutes). If the RSI crosses below 40, it indicates an oversold condition, potentially signaling a buying opportunity, especially if it aligns with a bullish trend on the higher timeframe.
Trade Execution:
Look for entries when the RSI shows a reversal or pullback in the direction of the higher timeframe trend.
Use the trend reversal markers to confirm potential intraday reversals, adding extra confidence to trade setups.
For Scalpers
Timeframe Selection:
Trend Timeframe: Set to a short intraday timeframe like 15-Minutes or 5-Minutes.
RSI Timeframe: Use an even shorter timeframe, such as 1-Minute, to capture rapid price movements.
Final Notes:
The "Trend and RSI Bias Fusion" indicator is a powerful tool that combines trend analysis, momentum assessment, and RSI insights into one cohesive package. By integrating these different aspects, the indicator helps traders navigate complex market environments with greater clarity and confidence. Customize the settings to fit your specific trading style and market and use it to stay ahead of market trends and potential reversals.
My Scripts/Indicators/Ideas /Systems that I share are only for educational purposes!
TMA Bands with Break Arrow @ClearTradingMind
The "TMA Bands with Break Arrow" indicator, developed by ClearTradingMind, is designed to provide traders with insights into potential trend reversals based on the movement of price within a channel defined by the Triangular Moving Average (TMA) and its bands. The TMA is a smoothed moving average, and this indicator adds upper and lower bands to visualize potential breakouts.
Key Components:
1. TMA Bands: The indicator plots the upper and lower bands of the TMA channel. These bands represent potential overbought (upper band) and oversold (lower band) conditions.
2. Break Arrows: The indicator generates buy (green triangle up) and sell (red triangle down) arrows when the closing price breaks above the upper band or below the lower band, indicating a potential trend reversal.
3. Background Color: The background color dynamically changes based on the last generated signal. A blue background suggests a recent buy signal, while a red background indicates a recent sell signal. This provides a quick visual reference for the prevailing market sentiment.
Usage:
1. Trend Reversals: Traders can use the buy and sell arrows as signals for potential trend reversals. A buy signal suggests a possible upward trend, while a sell signal suggests a potential downward trend.
2. Channel Breakouts: Watch for price breaking above the upper band (buy signal) or below the lower band (sell signal). These breakouts may indicate the start of a new trend.
3. Volatility Analysis: The width of the TMA channel represents volatility. A widening channel suggests increased volatility, while a narrowing channel suggests decreasing volatility.
4. Background Color: The background color provides additional context. A blue background indicates recent bullish sentiment, while a red background suggests recent bearish sentiment.
Parameters:
- TMA Period: The number of bars used to calculate the Triangular Moving Average.
- ATR Period: The number of bars used to calculate the Average True Range (ATR) for determining the width of the TMA channel.
- ATR Multiplier: A multiplier applied to the ATR to determine the width of the TMA channel.
Note: This indicator is a tool to assist traders in their analysis, and it is recommended to use it in conjunction with other technical and fundamental analysis methods for more comprehensive decision-making.
Disclaimer: Trading involves risk, and this indicator does not guarantee profit. Users should conduct thorough analysis and risk management before making trading decisions.
Ultimate RSI [captainua]Ultimate RSI
Overview
This indicator combines multiple RSI calculations with volume analysis, divergence detection, and trend filtering to provide a comprehensive RSI-based trading system. The script calculates RSI using three different periods (6, 14, 24) and applies various smoothing methods to reduce noise while maintaining responsiveness. The combination of these features creates a multi-layered confirmation system that reduces false signals by requiring alignment across multiple indicators and timeframes.
The script includes optimized configuration presets for instant setup: Scalping, Day Trading, Swing Trading, and Position Trading. Simply select a preset to instantly configure all settings for your trading style, or use Custom mode for full manual control. All settings include automatic input validation to prevent configuration errors and ensure optimal performance.
Configuration Presets
The script includes preset configurations optimized for different trading styles, allowing you to instantly configure the indicator for your preferred trading approach. Simply select a preset from the "Configuration Preset" dropdown menu:
- Scalping: Optimized for fast-paced trading with shorter RSI periods (4, 7, 9) and minimal smoothing. Noise reduction is automatically disabled, and momentum confirmation is disabled to allow faster signal generation. Designed for quick entries and exits in volatile markets.
- Day Trading: Balanced configuration for intraday trading with moderate RSI periods (6, 9, 14) and light smoothing. Momentum confirmation is enabled for better signal quality. Ideal for day trading strategies requiring timely but accurate signals.
- Swing Trading: Configured for medium-term positions with standard RSI periods (14, 14, 21) and moderate smoothing. Provides smoother signals suitable for swing trading timeframes. All noise reduction features remain active.
- Position Trading: Optimized for longer-term trades with extended RSI periods (24, 21, 28) and heavier smoothing. Filters are configured for highest-quality signals. Best for position traders holding trades over multiple days or weeks.
- Custom: Full manual control over all settings. All input parameters are available for complete customization. This is the default mode and maintains full backward compatibility with previous versions.
When a preset is selected, it automatically adjusts RSI periods, smoothing lengths, and filter settings to match the trading style. The preset configurations ensure optimal settings are applied instantly, eliminating the need for manual configuration. All settings can still be manually overridden if needed, providing flexibility while maintaining ease of use.
Input Validation and Error Prevention
The script includes comprehensive input validation to prevent configuration errors:
- Cross-Input Validation: Smoothing lengths are automatically validated to ensure they are always less than their corresponding RSI period length. If you set a smoothing length greater than or equal to the RSI length, the script automatically adjusts it to (RSI Length - 1). This prevents logical errors and ensures valid configurations.
- Input Range Validation: All numeric inputs have minimum and maximum value constraints enforced by TradingView's input system, preventing invalid parameter values.
- Smart Defaults: Preset configurations use validated default values that are tested and optimized for each trading style. When switching between presets, all related settings are automatically updated to maintain consistency.
Core Calculations
Multi-Period RSI:
The script calculates RSI using the standard Wilder's RSI formula: RSI = 100 - (100 / (1 + RS)), where RS = Average Gain / Average Loss over the specified period. Three separate RSI calculations run simultaneously:
- RSI(6): Uses 6-period lookback for high sensitivity to recent price changes, useful for scalping and early signal detection
- RSI(14): Standard 14-period RSI for balanced analysis, the most commonly used RSI period
- RSI(24): Longer 24-period RSI for trend confirmation, provides smoother signals with less noise
Each RSI can be smoothed using EMA, SMA, RMA (Wilder's smoothing), WMA, or Zero-Lag smoothing. Zero-Lag smoothing uses the formula: ZL-RSI = RSI + (RSI - RSI ) to reduce lag while maintaining signal quality. You can apply individual smoothing lengths to each RSI period, or use global smoothing where all three RSIs share the same smoothing length.
Dynamic Overbought/Oversold Thresholds:
Static thresholds (default 70/30) are adjusted based on market volatility using ATR. The formula: Dynamic OB = Base OB + (ATR × Volatility Multiplier × Base Percentage / 100), Dynamic OS = Base OS - (ATR × Volatility Multiplier × Base Percentage / 100). This adapts to volatile markets where traditional 70/30 levels may be too restrictive. During high volatility, the dynamic thresholds widen, and during low volatility, they narrow. The thresholds are clamped between 0-100 to remain within RSI bounds. The ATR is cached for performance optimization, updating on confirmed bars and real-time bars.
Adaptive RSI Calculation:
An adaptive RSI adjusts the standard RSI(14) based on current volatility relative to average volatility. The calculation: Adaptive Factor = (Current ATR / SMA of ATR over 20 periods) × Volatility Multiplier. If SMA of ATR is zero (edge case), the adaptive factor defaults to 0. The adaptive RSI = Base RSI × (1 + Adaptive Factor), clamped to 0-100. This makes the indicator more responsive during high volatility periods when traditional RSI may lag. The adaptive RSI is used for signal generation (buy/sell signals) but is not plotted on the chart.
Overbought/Oversold Fill Zones:
The script provides visual fill zones between the RSI line and the threshold lines when RSI is in overbought or oversold territory. The fill logic uses inclusive conditions: fills are shown when RSI is currently in the zone OR was in the zone on the previous bar. This ensures complete coverage of entry and exit boundaries. A minimum gap of 0.1 RSI points is maintained between the RSI plot and threshold line to ensure reliable polygon rendering in TradingView. The fill uses invisible plots at the threshold levels and the RSI value, with the fill color applied between them. You can select which RSI (6, 14, or 24) to use for the fill zones.
Divergence Detection
Regular Divergence:
Bullish divergence: Price makes a lower low (current low < lowest low from previous lookback period) while RSI makes a higher low (current RSI > lowest RSI from previous lookback period). Bearish divergence: Price makes a higher high (current high > highest high from previous lookback period) while RSI makes a lower high (current RSI < highest RSI from previous lookback period). The script compares current price/RSI values to the lowest/highest values from the previous lookback period using ta.lowest() and ta.highest() functions with index to reference the previous period's extreme.
Pivot-Based Divergence:
An enhanced divergence detection method that uses actual pivot points instead of simple lowest/highest comparisons. This provides more accurate divergence detection by identifying significant pivot lows/highs in both price and RSI. The pivot-based method uses a tolerance-based approach with configurable constants: 1% tolerance for price comparisons (priceTolerancePercent = 0.01) and 1.0 RSI point absolute tolerance for RSI comparisons (pivotTolerance = 1.0). Minimum divergence threshold is 1.0 RSI point (minDivergenceThreshold = 1.0). It looks for two recent pivot points and compares them: for bullish divergence, price makes a lower low (at least 1% lower) while RSI makes a higher low (at least 1.0 point higher). This method reduces false divergences by requiring actual pivot points rather than just any low/high within a period. When enabled, pivot-based divergence replaces the traditional method for more accurate signal generation.
Strong Divergence:
Regular divergence is confirmed by an engulfing candle pattern. Bullish engulfing requires: (1) Previous candle is bearish (close < open ), (2) Current candle is bullish (close > open), (3) Current close > previous open, (4) Current open < previous close. Bearish engulfing is the inverse: previous bullish, current bearish, current close < previous open, current open > previous close. Strong divergence signals are marked with visual indicators (🐂 for bullish, 🐻 for bearish) and have separate alert conditions.
Hidden Divergence:
Continuation patterns that signal trend continuation rather than reversal. Bullish hidden divergence: Price makes a higher low (current low > lowest low from previous period) but RSI makes a lower low (current RSI < lowest RSI from previous period). Bearish hidden divergence: Price makes a lower high (current high < highest high from previous period) but RSI makes a higher high (current RSI > highest RSI from previous period). These patterns indicate the trend is likely to continue in the current direction.
Volume Confirmation System
Volume threshold filtering requires current volume to exceed the volume SMA multiplied by the threshold factor. The formula: Volume Confirmed = Volume > (Volume SMA × Threshold). If the threshold is set to 0.1 or lower, volume confirmation is effectively disabled (always returns true). This allows you to use the indicator without volume filtering if desired.
Volume Climax is detected when volume exceeds: Volume SMA + (Volume StdDev × Multiplier). This indicates potential capitulation moments where extreme volume accompanies price movements. Volume Dry-Up is detected when volume falls below: Volume SMA - (Volume StdDev × Multiplier), indicating low participation periods that may produce unreliable signals. The volume SMA is cached for performance, updating on confirmed and real-time bars.
Multi-RSI Synergy
The script generates signals when multiple RSI periods align in overbought or oversold zones. This creates a confirmation system that reduces false signals. In "ALL" mode, all three RSIs (6, 14, 24) must be simultaneously above the overbought threshold OR all three must be below the oversold threshold. In "2-of-3" mode, any two of the three RSIs must align in the same direction. The script counts how many RSIs are in each zone: twoOfThreeOB = ((rsi6OB ? 1 : 0) + (rsi14OB ? 1 : 0) + (rsi24OB ? 1 : 0)) >= 2.
Synergy signals require: (1) Multi-RSI alignment (ALL or 2-of-3), (2) Volume confirmation, (3) Reset condition satisfied (enough bars since last synergy signal), (4) Additional filters passed (RSI50, Trend, ADX, Volume Dry-Up avoidance). Separate reset conditions track buy and sell signals independently. The reset condition uses ta.barssince() to count bars since the last trigger, returning true if the condition never occurred (allowing first signal) or if enough bars have passed.
Regression Forecasting
The script uses historical RSI values to forecast future RSI direction using four methods. The forecast horizon is configurable (1-50 bars ahead). Historical data is collected into an array, and regression coefficients are calculated based on the selected method.
Linear Regression: Calculates the least-squares fit line (y = mx + b) through the last N RSI values. The calculation: meanX = sumX / horizon, meanY = sumY / horizon, denominator = sumX² - horizon × meanX², m = (sumXY - horizon × meanX × meanY) / denominator, b = meanY - m × meanX. The forecast projects this line forward: forecast = b + m × i for i = 1 to horizon.
Polynomial Regression: Fits a quadratic curve (y = ax² + bx + c) to capture non-linear trends. The system of equations is solved using Cramer's rule with a 3×3 determinant. If the determinant is too small (< 0.0001), the system falls back to linear regression. Coefficients are calculated by solving: n×c + sumX×b + sumX²×a = sumY, sumX×c + sumX²×b + sumX³×a = sumXY, sumX²×c + sumX³×b + sumX⁴×a = sumX²Y. Note: Due to the O(n³) computational complexity of polynomial regression, the forecast horizon is automatically limited to a maximum of 20 bars when using polynomial regression to maintain optimal performance. If you set a horizon greater than 20 bars with polynomial regression, it will be automatically capped at 20 bars.
Exponential Smoothing: Applies exponential smoothing with adaptive alpha = 2/(horizon+1). The smoothing iterates from oldest to newest value: smoothed = alpha × series + (1 - alpha) × smoothed. Trend is calculated by comparing current smoothed value to an earlier smoothed value (at 60% of horizon): trend = (smoothed - earlierSmoothed) / (horizon - earlierIdx). Forecast: forecast = base + trend × i.
Moving Average: Uses the difference between short MA (horizon/2) and long MA (horizon) to estimate trend direction. Trend = (maShort - maLong) / (longLen - shortLen). Forecast: forecast = maShort + trend × i.
Confidence bands are calculated using RMSE (Root Mean Squared Error) of historical forecast accuracy. The error calculation compares historical values with forecast values: RMSE = sqrt(sumSquaredError / count). If insufficient data exists, it falls back to calculating standard deviation of recent RSI values. Confidence bands = forecast ± (RMSE × confidenceLevel). All forecast values and confidence bands are clamped to 0-100 to remain within RSI bounds. The regression functions include comprehensive safety checks: horizon validation (must not exceed array size), empty array handling, edge case handling for horizon=1 scenarios, division-by-zero protection, and bounds checking for all array access operations to prevent runtime errors.
Strong Top/Bottom Detection
Strong buy signals require three conditions: (1) RSI is at its lowest point within the bottom period: rsiVal <= ta.lowest(rsiVal, bottomPeriod), (2) RSI is below the oversold threshold minus a buffer: rsiVal < (oversoldThreshold - rsiTopBottomBuffer), where rsiTopBottomBuffer = 2.0 RSI points, (3) The absolute difference between current RSI and the lowest RSI exceeds the threshold value: abs(rsiVal - ta.lowest(rsiVal, bottomPeriod)) > threshold. This indicates a bounce from extreme levels with sufficient distance from the absolute low.
Strong sell signals use the inverse logic: RSI at highest point, above overbought threshold + rsiTopBottomBuffer (2.0 RSI points), and difference from highest exceeds threshold. Both signals also require: volume confirmation, reset condition satisfied (separate reset for buy vs sell), and all additional filters passed (RSI50, Trend, ADX, Volume Dry-Up avoidance).
The reset condition uses separate logic for buy and sell: resetCondBuy checks bars since isRSIAtBottom, resetCondSell checks bars since isRSIAtTop. This ensures buy signals reset based on bottom conditions and sell signals reset based on top conditions, preventing incorrect signal blocking.
Filtering System
RSI(50) Filter: Only allows buy signals when RSI(14) > 50 (bullish momentum) and sell signals when RSI(14) < 50 (bearish momentum). This filter ensures you're buying in uptrends and selling in downtrends from a momentum perspective. The filter is optional and can be disabled. Recommended to enable for noise reduction.
Trend Filter: Uses a long-term EMA (default 200) to determine trend direction. Buy signals require price above EMA, sell signals require price below EMA. The EMA slope is calculated as: emaSlope = ema - ema . Optional EMA slope filter additionally requires the EMA to be rising (slope > 0) for buy signals or falling (slope < 0) for sell signals. This provides stronger trend confirmation by requiring both price position and EMA direction.
ADX Filter: Uses the Directional Movement Index (calculated via ta.dmi()) to measure trend strength. Signals only fire when ADX exceeds the threshold (default 20), indicating a strong trend rather than choppy markets. The ADX calculation uses separate length and smoothing parameters. This filter helps avoid signals during sideways/consolidation periods.
Volume Dry-Up Avoidance: Prevents signals during periods of extremely low volume relative to average. If volume dry-up is detected and the filter is enabled, signals are blocked. This helps avoid unreliable signals that occur during low participation periods.
RSI Momentum Confirmation: Requires RSI to be accelerating in the signal direction before confirming signals. For buy signals, RSI must be consistently rising (recovering from oversold) over the lookback period. For sell signals, RSI must be consistently falling (declining from overbought) over the lookback period. The momentum check verifies that all consecutive changes are in the correct direction AND the cumulative change is significant. This filter ensures signals only fire when RSI momentum aligns with the signal direction, reducing false signals from weak momentum.
Multi-Timeframe Confirmation: Requires higher timeframe RSI to align with the signal direction. For buy signals, current RSI must be below the higher timeframe RSI by at least the confirmation threshold. For sell signals, current RSI must be above the higher timeframe RSI by at least the confirmation threshold. This ensures signals align with the larger trend context, reducing counter-trend trades. The higher timeframe RSI is fetched using request.security() from the selected timeframe.
All filters use the pattern: filterResult = not filterEnabled OR conditionMet. This means if a filter is disabled, it always passes (returns true). Filters can be combined, and all must pass for a signal to fire.
RSI Centerline and Period Crossovers
RSI(50) Centerline Crossovers: Detects when the selected RSI source crosses above or below the 50 centerline. Bullish crossover: ta.crossover(rsiSource, 50), bearish crossover: ta.crossunder(rsiSource, 50). You can select which RSI (6, 14, or 24) to use for these crossovers. These signals indicate momentum shifts from bearish to bullish (above 50) or bullish to bearish (below 50).
RSI Period Crossovers: Detects when different RSI periods cross each other. Available pairs: RSI(6) × RSI(14), RSI(14) × RSI(24), or RSI(6) × RSI(24). Bullish crossover: fast RSI crosses above slow RSI (ta.crossover(rsiFast, rsiSlow)), indicating momentum acceleration. Bearish crossover: fast RSI crosses below slow RSI (ta.crossunder(rsiFast, rsiSlow)), indicating momentum deceleration. These crossovers can signal shifts in momentum before price moves.
StochRSI Calculation
Stochastic RSI applies the Stochastic oscillator formula to RSI values instead of price. The calculation: %K = ((RSI - Lowest RSI) / (Highest RSI - Lowest RSI)) × 100, where the lookback is the StochRSI length. If the range is zero, %K defaults to 50.0. %K is then smoothed using SMA with the %K smoothing length. %D is calculated as SMA of smoothed %K with the %D smoothing length. All values are clamped to 0-100. You can select which RSI (6, 14, or 24) to use as the source for StochRSI calculation.
RSI Bollinger Bands
Bollinger Bands are applied to RSI(14) instead of price. The calculation: Basis = SMA(RSI(14), BB Period), StdDev = stdev(RSI(14), BB Period), Upper = Basis + (StdDev × Deviation Multiplier), Lower = Basis - (StdDev × Deviation Multiplier). This creates dynamic zones around RSI that adapt to RSI volatility. When RSI touches or exceeds the bands, it indicates extreme conditions relative to recent RSI behavior.
Noise Reduction System
The script includes a comprehensive noise reduction system to filter false signals and improve accuracy. When enabled, signals must pass multiple quality checks:
Signal Strength Requirement: RSI must be at least X points away from the centerline (50). For buy signals, RSI must be at least X points below 50. For sell signals, RSI must be at least X points above 50. This ensures signals only trigger when RSI is significantly in oversold/overbought territory, not just near neutral.
Extreme Zone Requirement: RSI must be deep in the OB/OS zone. For buy signals, RSI must be at least X points below the oversold threshold. For sell signals, RSI must be at least X points above the overbought threshold. This ensures signals only fire in extreme conditions where reversals are more likely.
Consecutive Bar Confirmation: The signal condition must persist for N consecutive bars before triggering. This reduces false signals from single-bar spikes or noise. The confirmation checks that the signal condition was true for all bars in the lookback period.
Zone Persistence (Optional): Requires RSI to remain in the OB/OS zone for N consecutive bars, not just touch it. This ensures RSI is truly in an extreme state rather than just briefly touching the threshold. When enabled, this provides stricter filtering for higher-quality signals.
RSI Slope Confirmation (Optional): Requires RSI to be moving in the expected signal direction. For buy signals, RSI should be rising (recovering from oversold). For sell signals, RSI should be falling (declining from overbought). This ensures momentum is aligned with the signal direction. The slope is calculated by comparing current RSI to RSI N bars ago.
All noise reduction filters can be enabled/disabled independently, allowing you to customize the balance between signal frequency and accuracy. The default settings provide a good balance, but you can adjust them based on your trading style and market conditions.
Alert System
The script includes separate alert conditions for each signal type: buy/sell (adaptive RSI crossovers), divergence (regular, strong, hidden), crossovers (RSI50 centerline, RSI period crossovers), synergy signals, and trend breaks. Each alert type has its own alertcondition() declaration with a unique title and message.
An optional cooldown system prevents alert spam by requiring a minimum number of bars between alerts of the same type. The cooldown check: canAlert = na(lastAlertBar) OR (bar_index - lastAlertBar >= cooldownBars). If the last alert bar is na (first alert), it always allows the alert. Each alert type maintains its own lastAlertBar variable, so cooldowns are independent per signal type. The default cooldown is 10 bars, which is recommended for noise reduction.
Higher Timeframe RSI
The script can display RSI from a higher timeframe using request.security(). This allows you to see the RSI context from a larger timeframe (e.g., daily RSI on an hourly chart). The higher timeframe RSI uses RSI(14) calculation from the selected timeframe. This provides context for the current timeframe's RSI position relative to the larger trend.
RSI Pivot Trendlines
The script can draw trendlines connecting pivot highs and lows on RSI(6). This feature helps visualize RSI trends and identify potential trend breaks.
Pivot Detection: Pivots are detected using a configurable period. The script can require pivots to have minimum strength (RSI points difference from surrounding bars) to filter out weak pivots. Lower minPivotStrength values detect more pivots (more trendlines), while higher values detect only stronger pivots (fewer but more significant trendlines). Pivot confirmation is optional: when enabled, the script waits N bars to confirm the pivot remains the extreme, reducing repainting. Pivot confirmation functions (f_confirmPivotLow and f_confirmPivotHigh) are always called on every bar for consistency, as recommended by TradingView. When pivot bars are not available (na), safe default values are used, and the results are then used conditionally based on confirmation settings. This ensures consistent calculations and prevents calculation inconsistencies.
Trendline Drawing: Uptrend lines connect confirmed pivot lows (green), and downtrend lines connect confirmed pivot highs (red). By default, only the most recent trendline is shown (old trendlines are deleted when new pivots are confirmed). This keeps the chart clean and uncluttered. If "Keep Historical Trendlines" is enabled, the script preserves up to N historical trendlines (configurable via "Max Trendlines to Keep", default 5). When historical trendlines are enabled, old trendlines are saved to arrays instead of being deleted, allowing you to see multiple trendlines simultaneously for better trend analysis. The arrays are automatically limited to prevent memory accumulation.
Trend Break Detection: Signals are generated when RSI breaks above or below trendlines. Uptrend breaks (RSI crosses below uptrend line) generate buy signals. Downtrend breaks (RSI crosses above downtrend line) generate sell signals. Optional trend break confirmation requires the break to persist for N bars and optionally include volume confirmation. Trendline angle filtering can exclude flat/weak trendlines from generating signals (minTrendlineAngle > 0 filters out weak/flat trendlines).
How Components Work Together
The combination of multiple RSI periods provides confirmation across different timeframes, reducing false signals. RSI(6) catches early moves, RSI(14) provides balanced signals, and RSI(24) confirms longer-term trends. When all three align (synergy), it indicates strong consensus across timeframes.
Volume confirmation ensures signals occur with sufficient market participation, filtering out low-volume false breakouts. Volume climax detection identifies potential reversal points, while volume dry-up avoidance prevents signals during unreliable low-volume periods.
Trend filters align signals with the overall market direction. The EMA filter ensures you're trading with the trend, and the EMA slope filter adds an additional layer by requiring the trend to be strengthening (rising EMA for buys, falling EMA for sells).
ADX filter ensures signals only fire during strong trends, avoiding choppy/consolidation periods. RSI(50) filter ensures momentum alignment with the trade direction.
Momentum confirmation requires RSI to be accelerating in the signal direction, ensuring signals only fire when momentum is aligned. Multi-timeframe confirmation ensures signals align with higher timeframe trends, reducing counter-trend trades.
Divergence detection identifies potential reversals before they occur, providing early warning signals. Pivot-based divergence provides more accurate detection by using actual pivot points. Hidden divergence identifies continuation patterns, useful for trend-following strategies.
The noise reduction system combines multiple filters (signal strength, extreme zone, consecutive bars, zone persistence, RSI slope) to significantly reduce false signals. These filters work together to ensure only high-quality signals are generated.
The synergy system requires alignment across all RSI periods for highest-quality signals, significantly reducing false positives. Regression forecasting provides forward-looking context, helping anticipate potential RSI direction changes.
Pivot trendlines provide visual trend analysis and can generate signals when RSI breaks trendlines, indicating potential reversals or continuations.
Reset conditions prevent signal spam by requiring a minimum number of bars between signals. Separate reset conditions for buy and sell signals ensure proper signal management.
Usage Instructions
Configuration Presets (Recommended): The script includes optimized preset configurations for instant setup. Simply select your trading style from the "Configuration Preset" dropdown:
- Scalping Preset: RSI(4, 7, 9) with minimal smoothing. Noise reduction disabled, momentum confirmation disabled for fastest signals.
- Day Trading Preset: RSI(6, 9, 14) with light smoothing. Momentum confirmation enabled for better signal quality.
- Swing Trading Preset: RSI(14, 14, 21) with moderate smoothing. Balanced configuration for medium-term trades.
- Position Trading Preset: RSI(24, 21, 28) with heavier smoothing. Optimized for longer-term positions with all filters active.
- Custom Mode: Full manual control over all settings. Default behavior matches previous script versions.
Presets automatically configure RSI periods, smoothing lengths, and filter settings. You can still manually adjust any setting after selecting a preset if needed.
Getting Started: The easiest way to get started is to select a configuration preset matching your trading style (Scalping, Day Trading, Swing Trading, or Position Trading) from the "Configuration Preset" dropdown. This instantly configures all settings for optimal performance. Alternatively, use "Custom" mode for full manual control. The default configuration (Custom mode) shows RSI(6), RSI(14), and RSI(24) with their default smoothing. Overbought/oversold fill zones are enabled by default.
Customizing RSI Periods: Adjust the RSI lengths (6, 14, 24) based on your trading timeframe. Shorter periods (6) for scalping, standard (14) for day trading, longer (24) for swing trading. You can disable any RSI period you don't need.
Smoothing Selection: Choose smoothing method based on your needs. EMA provides balanced smoothing, RMA (Wilder's) is traditional, Zero-Lag reduces lag but may increase noise. Adjust smoothing lengths individually or use global smoothing for consistency. Note: Smoothing lengths are automatically validated to ensure they are always less than the corresponding RSI period length. If you set smoothing >= RSI length, it will be auto-adjusted to prevent invalid configurations.
Dynamic OB/OS: The dynamic thresholds automatically adapt to volatility. Adjust the volatility multiplier and base percentage to fine-tune sensitivity. Higher values create wider thresholds in volatile markets.
Volume Confirmation: Set volume threshold to 1.2 (default) for standard confirmation, higher for stricter filtering, or 0.1 to disable volume filtering entirely.
Multi-RSI Synergy: Use "ALL" mode for highest-quality signals (all 3 RSIs must align), or "2-of-3" mode for more frequent signals. Adjust the reset period to control signal frequency.
Filters: Enable filters gradually to find your preferred balance. Start with volume confirmation, then add trend filter, then ADX for strongest confirmation. RSI(50) filter is useful for momentum-based strategies and is recommended for noise reduction. Momentum confirmation and multi-timeframe confirmation add additional layers of accuracy but may reduce signal frequency.
Noise Reduction: The noise reduction system is enabled by default with balanced settings. Adjust minSignalStrength (default 3.0) to control how far RSI must be from centerline. Increase requireConsecutiveBars (default 1) to require signals to persist longer. Enable requireZonePersistence and requireRsiSlope for stricter filtering (higher quality but fewer signals). Start with defaults and adjust based on your needs.
Divergence: Enable divergence detection and adjust lookback periods. Strong divergence (with engulfing confirmation) provides higher-quality signals. Hidden divergence is useful for trend-following strategies. Enable pivot-based divergence for more accurate detection using actual pivot points instead of simple lowest/highest comparisons. Pivot-based divergence uses tolerance-based matching (1% for price, 1.0 RSI point for RSI) for better accuracy.
Forecasting: Enable regression forecasting to see potential RSI direction. Linear regression is simplest, polynomial captures curves, exponential smoothing adapts to trends. Adjust horizon based on your trading timeframe. Confidence bands show forecast uncertainty - wider bands indicate less reliable forecasts.
Pivot Trendlines: Enable pivot trendlines to visualize RSI trends and identify trend breaks. Adjust pivot detection period (default 5) - higher values detect fewer but stronger pivots. Enable pivot confirmation (default ON) to reduce repainting. Set minPivotStrength (default 1.0) to filter weak pivots - lower values detect more pivots (more trendlines), higher values detect only stronger pivots (fewer trendlines). Enable "Keep Historical Trendlines" to preserve multiple trendlines instead of just the most recent one. Set "Max Trendlines to Keep" (default 5) to control how many historical trendlines are preserved. Enable trend break confirmation for more reliable break signals. Adjust minTrendlineAngle (default 0.0) to filter flat trendlines - set to 0.1-0.5 to exclude weak trendlines.
Alerts: Set up alerts for your preferred signal types. Enable cooldown to prevent alert spam. Each signal type has its own alert condition, so you can be selective about which signals trigger alerts.
Visual Elements and Signal Markers
The script uses various visual markers to indicate signals and conditions:
- "sBottom" label (green): Strong bottom signal - RSI at extreme low with strong buy conditions
- "sTop" label (red): Strong top signal - RSI at extreme high with strong sell conditions
- "SyBuy" label (lime): Multi-RSI synergy buy signal - all RSIs aligned oversold
- "SySell" label (red): Multi-RSI synergy sell signal - all RSIs aligned overbought
- 🐂 emoji (green): Strong bullish divergence detected
- 🐻 emoji (red): Strong bearish divergence detected
- 🔆 emoji: Weak divergence signals (if enabled)
- "H-Bull" label: Hidden bullish divergence
- "H-Bear" label: Hidden bearish divergence
- ⚡ marker (top of pane): Volume climax detected (extreme volume) - positioned at top for visibility
- 💧 marker (top of pane): Volume dry-up detected (very low volume) - positioned at top for visibility
- ↑ triangle (lime): Uptrend break signal - RSI breaks below uptrend line
- ↓ triangle (red): Downtrend break signal - RSI breaks above downtrend line
- Triangle up (lime): RSI(50) bullish crossover
- Triangle down (red): RSI(50) bearish crossover
- Circle markers: RSI period crossovers
All markers are positioned at the RSI value where the signal occurs, using location.absolute for precise placement.
Signal Priority and Interpretation
Signals are generated independently and can occur simultaneously. Higher-priority signals generally indicate stronger setups:
1. Multi-RSI Synergy signals (SyBuy/SySell) - Highest priority: Requires alignment across all RSI periods plus volume and filter confirmation. These are the most reliable signals.
2. Strong Top/Bottom signals (sTop/sBottom) - High priority: Indicates extreme RSI levels with strong bounce conditions. Requires volume confirmation and all filters.
3. Divergence signals - Medium-High priority: Strong divergence (with engulfing) is more reliable than regular divergence. Hidden divergence indicates continuation rather than reversal.
4. Adaptive RSI crossovers - Medium priority: Buy when adaptive RSI crosses below dynamic oversold, sell when it crosses above dynamic overbought. These use volatility-adjusted RSI for more accurate signals.
5. RSI(50) centerline crossovers - Medium priority: Momentum shift signals. Less reliable alone but useful when combined with other confirmations.
6. RSI period crossovers - Lower priority: Early momentum shift indicators. Can provide early warning but may produce false signals in choppy markets.
Best practice: Wait for multiple confirmations. For example, a synergy signal combined with divergence and volume climax provides the strongest setup.
Chart Requirements
For proper script functionality and compliance with TradingView requirements, ensure your chart displays:
- Symbol name: The trading pair or instrument name should be visible
- Timeframe: The chart timeframe should be clearly displayed
- Script name: "Ultimate RSI " should be visible in the indicator title
These elements help traders understand what they're viewing and ensure proper script identification. The script automatically includes this information in the indicator title and chart labels.
Performance Considerations
The script is optimized for performance:
- ATR and Volume SMA are cached using var variables, updating only on confirmed and real-time bars to reduce redundant calculations
- Forecast line arrays are dynamically managed: lines are reused when possible, and unused lines are deleted to prevent memory accumulation
- Calculations use efficient Pine Script functions (ta.rsi, ta.ema, etc.) which are optimized by TradingView
- Array operations are minimized where possible, with direct calculations preferred
- Polynomial regression automatically caps the forecast horizon at 20 bars (POLYNOMIAL_MAX_HORIZON constant) to prevent performance degradation, as polynomial regression has O(n³) complexity. This safeguard ensures optimal performance even with large horizon settings
- Pivot detection includes edge case handling to ensure reliable calculations even on early bars with limited historical data. Regression forecasting functions include comprehensive safety checks: horizon validation (must not exceed array size), empty array handling, edge case handling for horizon=1 scenarios, and division-by-zero protection in all mathematical operations
The script should perform well on all timeframes. On very long historical data, forecast lines may accumulate if the horizon is large; consider reducing the forecast horizon if you experience performance issues. The polynomial regression performance safeguard automatically prevents performance issues for that specific regression type.
Known Limitations and Considerations
- Forecast lines are forward-looking projections and should not be used as definitive predictions. They provide context but are not guaranteed to be accurate.
- Dynamic OB/OS thresholds can exceed 100 or go below 0 in extreme volatility scenarios, but are clamped to 0-100 range. This means in very volatile markets, the dynamic thresholds may not widen as much as the raw calculation suggests.
- Volume confirmation requires sufficient historical volume data. On new instruments or very short timeframes, volume calculations may be less reliable.
- Higher timeframe RSI uses request.security() which may have slight delays on some data feeds.
- Regression forecasting requires at least N bars of history (where N = forecast horizon) before it can generate forecasts. Early bars will not show forecast lines.
- StochRSI calculation requires the selected RSI source to have sufficient history. Very short RSI periods on new charts may produce less reliable StochRSI values initially.
Practical Use Cases
The indicator can be configured for different trading styles and timeframes:
Swing Trading: Select the "Swing Trading" preset for instant optimal configuration. This preset uses RSI periods (14, 14, 21) with moderate smoothing. Alternatively, manually configure: Use RSI(24) with Multi-RSI Synergy in "ALL" mode, combined with trend filter (EMA 200) and ADX filter. This configuration provides high-probability setups with strong confirmation across multiple RSI periods.
Day Trading: Select the "Day Trading" preset for instant optimal configuration. This preset uses RSI periods (6, 9, 14) with light smoothing and momentum confirmation enabled. Alternatively, manually configure: Use RSI(6) with Zero-Lag smoothing for fast signal detection. Enable volume confirmation with threshold 1.2-1.5 for reliable entries. Combine with RSI(50) filter to ensure momentum alignment. Strong top/bottom signals work well for day trading reversals.
Trend Following: Enable trend filter (EMA) and EMA slope filter for strong trend confirmation. Use RSI(14) or RSI(24) with ADX filter to avoid choppy markets. Hidden divergence signals are useful for trend continuation entries.
Reversal Trading: Focus on divergence detection (regular and strong) combined with strong top/bottom signals. Enable volume climax detection to identify capitulation moments. Use RSI(6) for early reversal signals, confirmed by RSI(14) and RSI(24).
Forecasting and Planning: Enable regression forecasting with polynomial or exponential smoothing methods. Use forecast horizon of 10-20 bars for swing trading, 5-10 bars for day trading. Confidence bands help assess forecast reliability.
Multi-Timeframe Analysis: Enable higher timeframe RSI to see context from larger timeframes. For example, use daily RSI on hourly charts to understand the larger trend context. This helps avoid counter-trend trades.
Scalping: Select the "Scalping" preset for instant optimal configuration. This preset uses RSI periods (4, 7, 9) with minimal smoothing, disables noise reduction, and disables momentum confirmation for faster signals. Alternatively, manually configure: Use RSI(6) with minimal smoothing (or Zero-Lag) for ultra-fast signals. Disable most filters except volume confirmation. Use RSI period crossovers (RSI(6) × RSI(14)) for early momentum shifts. Set volume threshold to 1.0-1.2 for less restrictive filtering.
Position Trading: Select the "Position Trading" preset for instant optimal configuration. This preset uses extended RSI periods (24, 21, 28) with heavier smoothing, optimized for longer-term trades. Alternatively, manually configure: Use RSI(24) with all filters enabled (Trend, ADX, RSI(50), Volume Dry-Up avoidance). Multi-RSI Synergy in "ALL" mode provides highest-quality signals.
Practical Tips and Best Practices
Getting Started: The fastest way to get started is to select a configuration preset that matches your trading style. Simply choose "Scalping", "Day Trading", "Swing Trading", or "Position Trading" from the "Configuration Preset" dropdown to instantly configure all settings optimally. For advanced users, use "Custom" mode for full manual control. The default configuration (Custom mode) is balanced and works well across different markets. After observing behavior, customize settings to match your trading style.
Reducing Repainting: All signals are based on confirmed bars, minimizing repainting. The script uses confirmed bar data for all calculations to ensure backtesting accuracy.
Signal Quality: Multi-RSI Synergy signals in "ALL" mode provide the highest-quality signals because they require alignment across all three RSI periods. These signals have lower frequency but higher reliability. For more frequent signals, use "2-of-3" mode. The noise reduction system further improves signal quality by requiring multiple confirmations (signal strength, extreme zone, consecutive bars, optional zone persistence and RSI slope). Adjust noise reduction settings to balance signal frequency vs. accuracy.
Filter Combinations: Start with volume confirmation, then add trend filter for trend alignment, then ADX filter for trend strength. Combining all three filters significantly reduces false signals but also reduces signal frequency. Find your balance based on your risk tolerance.
Volume Filtering: Set volume threshold to 0.1 or lower to effectively disable volume filtering if you trade instruments with unreliable volume data or want to test without volume confirmation. Standard confirmation uses 1.2-1.5 threshold.
RSI Period Selection: RSI(6) is most sensitive and best for scalping or early signal detection. RSI(14) provides balanced signals suitable for day trading. RSI(24) is smoother and better for swing trading and trend confirmation. You can disable any RSI period you don't need to reduce visual clutter.
Smoothing Methods: EMA provides balanced smoothing with moderate lag. RMA (Wilder's smoothing) is traditional and works well for RSI. Zero-Lag reduces lag but may increase noise. WMA gives more weight to recent values. Choose based on your preference for responsiveness vs. smoothness.
Forecasting: Linear regression is simplest and works well for trending markets. Polynomial regression captures curves and works better in ranging markets. Exponential smoothing adapts to trends. Moving average method is most conservative. Use confidence bands to assess forecast reliability.
Divergence: Strong divergence (with engulfing confirmation) is more reliable than regular divergence. Hidden divergence indicates continuation rather than reversal, useful for trend-following strategies. Pivot-based divergence provides more accurate detection by using actual pivot points instead of simple lowest/highest comparisons. Adjust lookback periods based on your timeframe: shorter for day trading, longer for swing trading. Pivot divergence period (default 5) controls the sensitivity of pivot detection.
Dynamic Thresholds: Dynamic OB/OS thresholds automatically adapt to volatility. In volatile markets, thresholds widen; in calm markets, they narrow. Adjust the volatility multiplier and base percentage to fine-tune sensitivity. Higher values create wider thresholds in volatile markets.
Alert Management: Enable alert cooldown (default 10 bars, recommended) to prevent alert spam. Each alert type has its own cooldown, so you can set different cooldowns for different signal types. For example, use shorter cooldown for synergy signals (high quality) and longer cooldown for crossovers (more frequent). The cooldown system works independently for each signal type, preventing spam while allowing different signal types to fire when appropriate.
Technical Specifications
- Pine Script Version: v6
- Indicator Type: Non-overlay (displays in separate panel below price chart)
- Repainting Behavior: Minimal - all signals are based on confirmed bars, ensuring accurate backtesting results
- Performance: Optimized with caching for ATR and volume calculations. Forecast arrays are dynamically managed to prevent memory accumulation.
- Compatibility: Works on all timeframes (1 minute to 1 month) and all instruments (stocks, forex, crypto, futures, etc.)
- Edge Case Handling: All calculations include safety checks for division by zero, NA values, and boundary conditions. Reset conditions and alert cooldowns handle edge cases where conditions never occurred or values are NA.
- Reset Logic: Separate reset conditions for buy signals (based on bottom conditions) and sell signals (based on top conditions) ensure logical correctness.
- Input Parameters: 60+ customizable parameters organized into logical groups for easy configuration. Configuration presets available for instant setup (Scalping, Day Trading, Swing Trading, Position Trading, Custom).
- Noise Reduction: Comprehensive noise reduction system with multiple filters (signal strength, extreme zone, consecutive bars, zone persistence, RSI slope) to reduce false signals.
- Pivot-Based Divergence: Enhanced divergence detection using actual pivot points for improved accuracy.
- Momentum Confirmation: RSI momentum filter ensures signals only fire when RSI is accelerating in the signal direction.
- Multi-Timeframe Confirmation: Optional higher timeframe RSI alignment for trend confirmation.
- Enhanced Pivot Trendlines: Trendline drawing with strength requirements, confirmation, and trend break detection.
Technical Notes
- All RSI values are clamped to 0-100 range to ensure valid oscillator values
- ATR and Volume SMA are cached for performance, updating on confirmed and real-time bars
- Reset conditions handle edge cases: if a condition never occurred, reset returns true (allows first signal)
- Alert cooldown handles na values: if no previous alert, cooldown allows the alert
- Forecast arrays are dynamically sized based on horizon, with unused lines cleaned up
- Fill logic uses a minimum gap (0.1) to ensure reliable polygon rendering in TradingView
- All calculations include safety checks for division by zero and boundary conditions. Regression functions validate that horizon doesn't exceed array size, and all array access operations include bounds checking to prevent out-of-bounds errors
- The script uses separate reset conditions for buy signals (based on bottom conditions) and sell signals (based on top conditions) for logical correctness
- Background coloring uses a fallback system: dynamic color takes priority, then RSI(6) heatmap, then monotone if both are disabled
- Noise reduction filters are applied after accuracy filters, providing multiple layers of signal quality control
- Pivot trendlines use strength requirements to filter weak pivots, reducing noise in trendline drawing. Historical trendlines are stored in arrays and automatically limited to prevent memory accumulation when "Keep Historical Trendlines" is enabled
- Volume climax and dry-up markers are positioned at the top of the pane for better visibility
- All calculations are optimized with conditional execution - features only calculate when enabled (performance optimization)
- Input Validation: Automatic cross-input validation ensures smoothing lengths are always less than RSI period lengths, preventing configuration errors
- Configuration Presets: Four optimized preset configurations (Scalping, Day Trading, Swing Trading, Position Trading) for instant setup, plus Custom mode for full manual control
- Constants Management: Magic numbers extracted to documented constants for improved maintainability and easier tuning (pivot tolerance, divergence thresholds, fill gap, etc.)
- TradingView Function Consistency: All TradingView functions (ta.crossover, ta.crossunder, ta.atr, ta.lowest, ta.highest, ta.lowestbars, ta.highestbars, etc.) and custom functions that depend on historical results (f_consecutiveBarConfirmation, f_rsiSlopeConfirmation, f_rsiZonePersistence, f_applyAllFilters, f_rsiMomentum, f_forecast, f_confirmPivotLow, f_confirmPivotHigh) are called on every bar for consistency, as recommended by TradingView. Results are then used conditionally when needed. This ensures consistent calculations and prevents calculation inconsistencies.
BK AK-13⚔️ BK AK-13 — The Mentor’s 13. Revealed on 11. Command the Band. Punish the Extremes. ⚔️
This is my 11th release—and that matters. 11 is a sacred number to me, so for release eleven I’m doing something I never planned to do: I’m putting my mentor’s secret 13 MA into the open.
For years, this 13-based MA framework was part of our private playbook—quietly doing work behind the scenes. Now I’m handing it to you fully armed, because I believe in karma in, karma out: I took years of wisdom from the market. I took years of wisdom from the men who taught me. This is one of the ways I give back—with structure, respect, and intent.
🎖 Full Credit — Respect the Origin
The core architecture of BK AK-13 is not mine. It stands firmly on the work of DZIV.
What comes from DZIV:
The Heikin Ashi MA engine (MA calculated on HA Open/High/Low/Close)
The multi-MA engine on the HA feed (ALMA / HMA / SMA / RMA / VWMA / WMA / ZLEMA / EMA)
The Body / Wick / Band zone classification for price
The dynamic body & wick clouds that give this structure its clean visual form
If this framework changes the way you see trend and price location, remember the name: DZIV.
On top of his backbone, I forged the BK AK-13 enhancement layer: trend-strength regimes, background modes, structured band-reversal arrows, momentum acceleration dots, extreme pivot markers, historical band-touch rails, the info panel, and a complete alert suite.
And as always, the “AK” in the name is not branding—it’s honor. It belongs to my mentor A.K. His secret 13 MA is the spine of this system, and his obsession with clarity, patience, and zero shortcuts sits behind every decision in this tool. Above that, all glory and gratitude to Gd—the real source of any wisdom, edge, or endurance we have in this game.
🧠 Why “BK AK-13”?
BK — my mark, the house I’m building.
AK — my mentor, the standard I’m still chasing.
13 — his secret moving average, the length that quietly shaped how I see trend, location, and pressure.
For years, 13 stayed off the public record—used, not discussed. Now, on indicator number 11, I’m putting that weapon in the open: 11th release. Sacred number. Secret 13 revealed, not for hype—but as karmic give-back. Karma in. Karma out.
🧱 What BK AK-13 Actually Is
BK AK-13 is a Heikin Ashi MA battle band with a brain and a conscience.
It does three big things:
Builds a smoothed HA-MA band using Heikin Ashi OHLC to create a cleaner, truer band around price.
Maps price into zones: Body, Upper Wick, Lower Wick, Above Band, Below Band—so every bar has a role.
Assigns a trend regime by computing a normalized trend-strength %, classifying the environment as Weak / Normal / Strong / Extreme.
You’re never guessing: Is this real trend or just drift? Am I in the spine, the wick, or off the rails? Is this where I press, fade, or stand down? The band, zones, and regimes answer that for you.
🎨 Visual Architecture — Band, Clouds, Regimes
Body & Wick Clouds (DZIV’s craft)
Body cloud between HA-MA Open & Close.
Wick clouds between body and HA-MA High/Low.
Color follows trend: bull, bear, or neutral.
You’re not decoding noisy candles—you’re reading the spine and skin of the move.
Background Regime Modes (BK layer)
Standard – background always on, soft trend-follow color.
Hybrid (Extreme + Breaks) – lights only on extreme trend states or reversal break events.
Hybrid (Strong/Extreme + Breaks) – shows strong & extreme regimes, darker tone on true extremes.
Breaks Only – background flashes only on reversal arrows.
When the background goes quiet, you’re in ordinary flow. When it lights up, something is strategic, not cosmetic.
🎯 Weapons Inside BK AK-13
⭐ Trend Change Stars
Stars appear when the internal band trend crosses zero: bull star when it flips negative → positive, bear star from positive → negative. They’re your pivot flags for swing shifts when aligned with your higher timeframe bias.
🔁 Band Reversal Arrows — Edge Flip Logic
Not every band tap—only structured reversals:
Reversal Down (short idea): first a break of the upper band, then later, for the first time, a break of the lower band.
Reversal Up (long idea): first a break of the lower band, then later, for the first time, a break of the upper band.
You can require a close outside the band and set a minimum break distance (% of band range) so only real punches count. These arrows mark campaign flips, not noise.
💡 Momentum Acceleration Dots
In strong trend regimes only:
Green dot = trend accelerating in its own direction (uptrend steepening, downtrend deepening).
Red dot = trend decelerating, even if direction hasn’t flipped yet.
They protect you from chasing late when the engine is dying and from staying stubborn when momentum is bleeding out.
⚠ Extreme Pivot Markers
Pivot highs/lows are found with a configurable lookback and only marked when trend strength at that pivot bar is above your threshold. You’ll see ⚠ above likely exhaustion tops in strong bulls and ⚠ below likely exhaustion lows in strong bears—perfect for final scale-outs, countertrend scouts, and knowing where campaigns commonly run out of blood.
📏 Historical Band-Touch Rails
Over your lookback window, BK AK-13 tracks the highest upper band touch and lowest lower band touch, drawing them as dashed rails. They’re dynamic SR built from real band extremes—ideal for trend targets, fade zones, and stop/scale-out context.
🧭 Info Panel — On-Chart War Room
The Info Panel compresses everything into a single strip: direction + strength codes (BULL STR, BEAR EXT, NEUT WEAK), four segments that brighten as |trend| climbs from weak → normal → strong → extreme, and a zone + deviation label (BDY/UW/LW/AB/BL × OK/AL/EX).
Hover and you get a full tactical brief: trend, momentum change, acceleration, band levels, distances to upper/lower/nearest band in ticks, outer-band streaks, strategic state, plus “Action” guidance and a “What-if” forward scenario. It doesn’t just tell you where you are—it pushes you toward a structured thought process on each bar.
🕹 How to Use BK AK-13 with Intent
1️⃣ Trend-Rider Mode
In Strong/Extreme bull with price in Body or Lower Wick: buy dips into the band (mid/lower) instead of chasing tops; target the upper band / upper rail while structure holds.
In Strong/Extreme bear with price in Body or Upper Wick: sell rallies into the band; target lower band / lower rail while acceleration stays healthy.
The band defines where you’re allowed to do business.
2️⃣ Extreme Snapback Hunter
Prime conditions: trend tagged Extreme, price pressed into the outer band in trend direction, strategic state lit + Hybrid background active. That’s where pressing fresh risk often flips from reward to punishment. Use it to stop adding, start harvesting, or launch controlled mean-reversion probes back to the midline—if your system and risk rules allow it.
3️⃣ Exhaustion & Turn Zones
Watch for confluence: red momentum dots, extreme pivot ⚠ markers, a reversal arrow, and a nearby historical rail or your own key level (Fibs, VWAP, volume structure, etc.). That’s where campaigns often end, traps are set, and new campaigns begin.
🔔 Alerts — The Chart Calls You
Included alerts: Bullish/Bearish Trend Change, Strategic Extreme at Outer Band, Reversal Up/Down, Extreme Pivot High/Low, and Body Zone Entry during Strong Trend. Use them so you respond to events, not impulses.
🔧 Tuning the Extremes — Help Me Perfect the Advanced Side
The extreme thresholds and advanced features are powerful but sensitive, and there is no single perfect universal setting. I’m still tuning them myself across instruments and timeframes: strong/extreme trend thresholds, extreme background thresholds, momentum acceleration threshold, pivot lookback + pivot trend filter, band-touch lookback, and minimum break distance for reversals.
Different markets and timeframes breathe differently.
If you find killer settings for a specific symbol + timeframe, please share:
Instrument & timeframe
Your tuned values for extremes and advanced modules
A few charts showing why they work
Experiment. Dial it in. Then share your best settings for the extremes and advanced features. Let this become a crowd-forged battle manual: I gave you the engine, you tune it to your battleground, and we all benefit from what’s discovered in live fire. Karma in. Karma out.
🤝 Pay It Forward
If BK AK-13 sharpens your read, don’t just flex screenshots—teach structure. Show newer traders body vs wick vs edge. Talk about when you didn’t take a trade because the band said “danger,” not just the wins. Share your settings, charts, and lessons—especially around the extremes and advanced modules. I’m sharing a mentor’s secret on release 11 for a reason. If it blesses you, don’t let it stop with you.
📜 King Solomon’s Lens
King Solomon said: “The prudent sees danger and hides himself, but the simple go on and suffer for it.”
BK AK-13 is built exactly around that dividing line: the simple chase candles at the outer band in extreme regimes and get punished; the prudent see danger in the structure, hide their size, hedge, or reverse with intent.
This indicator won’t make you prudent. It just removes your excuse for being simple.
⚔️ BK AK-13 — The mentor’s secret 13, revealed on 11. Let the band define the field. Let wisdom define your strike.
May Gd bless your eyes, your patience, your settings, and every decision you make at the edge. 🙏
Multiple (12) Strong Buy/Sell Signals + Momentum
Indicator Manual: "Multiple (12) Strong Buy/Sell Signals + Momentum"
This indicator is designed to identify strong buy and sell signals based on 12 configurable conditions, which include a variety of technical analysis methods such as trend-following indicators, pattern recognition, volume analysis, and momentum oscillators. It allows for customizable alerts and visual cues on the chart. The indicator helps traders spot potential entry and exit points by displaying buy and sell signals based on the selected conditions.
Key Observations:
• The script integrates multiple indicators and pattern recognition methods to provide comprehensive buy/sell signals.
• Trend-based indicators like EMAs and MACD are combined with pattern recognition (flags, triangles) and momentum-based signals (RSI, ADX, and volume analysis).
• User customization is a core feature, allowing adjustments to the conditions and thresholds for more tailored signals.
• The script is designed to be responsive to market conditions, with multiple conditions filtering out noise to generate reliable signals.
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Key Features:
1. 12 Combined Buy/Sell Signal Conditions: This indicator incorporates a diverse set of conditions based on trend analysis, momentum, and price patterns.
2. Minimum Conditions Input: You can adjust the threshold of conditions that need to be met for the buy/sell signals to appear.
3. Alert Customization: Set alert thresholds for both buy and sell signals.
4. Dynamic Visualization: Buy and sell signals are shown as triangles on the chart, with momentum signals highlighted as circles.
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Detailed Description of the 12 Conditions:
1. Exponential Moving Averages (EMA):
o Conditions: The indicator uses EMAs with periods 3, 8, and 13 for quick trend-following signals.
o Bullish Signal: EMA3 > EMA8 > EMA13 (Bullish stack).
o Bearish Signal: EMA3 < EMA8 < EMA13 (Bearish stack).
o Reversal Signal: The crossing over or under of these EMAs can signify trend reversals.
2. MACD (Moving Average Convergence Divergence):
o Fast MACD (2, 7, 3) is used to confirm trends quickly.
o Bullish Signal: When the MACD line crosses above the signal line.
o Bearish Signal: When the MACD line crosses below the signal line.
3. Donchian Channel:
o Tracks the highest high and lowest low over a given period (default 20).
o Breakout Signal: Price breaking above the upper band is bullish; breaking below the lower band is bearish.
4. VWAP (Volume-Weighted Average Price):
o Above VWAP: Bullish condition (price above VWAP).
o Below VWAP: Bearish condition (price below VWAP).
5. EMA Stacking & Reversal:
o Tracks the order of EMAs (3, 8, 13) to confirm strong trends and reversals.
o Bullish Reversal: EMA3 < EMA8 < EMA13 followed by a crossing to bullish.
o Bearish Reversal: EMA3 > EMA8 > EMA13 followed by a crossing to bearish.
6. Bull/Bear Flags:
o Bull Flag: Characterized by a strong price movement (flagpole) followed by a pullback and breakout.
o Bear Flag: Similar to Bull Flag but in the opposite direction.
7. Triangle Patterns (Ascending and Descending):
o Detects ascending and descending triangles using pivot highs and lows.
o Ascending Triangle: Higher lows and flat resistance.
o Descending Triangle: Lower highs and flat support.
8. Volume Sensitivity:
o Identifies price moves with significant volume increases.
o High Volume: When current volume is significantly above the moving average volume (set to 1.2x of the average).
9. Momentum Indicators:
o RSI (Relative Strength Index): Confirms overbought and oversold levels with thresholds set at 65 (overbought) and 35 (oversold).
o ADX (Average Directional Index): Confirms strong trends when ADX > 28.
o Momentum Up: Momentum is upward with strong volume and bullish RSI/ADX conditions.
o Momentum Down: Momentum is downward with strong volume and bearish RSI/ADX conditions.
10. Bollinger & Keltner Squeeze:
o Squeeze Condition: A contraction in both Bollinger Bands and Keltner Channels indicates low volatility, signaling a potential breakout.
o Squeeze Breakout: Price breaking above or below the squeeze bands.
11. 3 Consecutive Candles Condition:
o Bullish: Price rises for three consecutive candles with higher highs and lows.
o Bearish: Price falls for three consecutive candles with lower highs and lows.
12. Williams %R and Stochastic RSI:
o Williams %R: A momentum oscillator with signals when the line crosses certain levels.
o Stochastic RSI: Provides overbought/oversold levels with smoother signals.
o Combined Signals: You can choose whether to require both WPR and StochRSI to signal a buy/sell.
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User Inputs (Inputs Tab):
1. Minimum Conditions for Buy/Sell:
o min_conditions: Number of conditions required to trigger a buy/sell signal on the chart (1 to 12).
o Alert_min_conditions: User-defined alert threshold (how many conditions must be met before an alert is triggered).
2. Donchian Channel Settings:
o Show Donchian: Toggle visibility of the Donchian channel.
o Donchian Length: The length of the Donchian Channel (default 20).
3. Bull/Bear Flag Settings:
o Bull Flag Flagpole Strength: ATR multiplier to define the strength of the flagpole.
o Bull Flag Pullback Length: Length of pullback for the bull flag pattern.
o Bull Flag EMA Length: EMA length used to confirm trend during bull flag pattern.
Similar settings exist for Bear Flag patterns.
4. Momentum Indicators:
o RSI Length: Period for calculating the RSI (default 9).
o RSI Overbought: Overbought threshold for the RSI (default 65).
o RSI Oversold: Oversold threshold for the RSI (default 35).
5. Bollinger/Keltner Squeeze Settings:
o Squeeze Width Threshold: The maximum width of the Bollinger and Keltner Bands for squeeze conditions.
6. Stochastic RSI Settings:
o Stochastic RSI Length: The period for calculating the Stochastic RSI.
7. WPR Settings:
o WPR Length: Period for calculating Williams %R (default 14).
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User Inputs (Style Tab):
1. Signal Plotting:
o Control the display and colors of the buy/sell signals, momentum indicators, and pattern signals on the chart.
o Buy/Sell Signals: Can be customized with different colors and shapes (triangle up for buys, triangle down for sells).
o Momentum Signals: Custom circle placement for momentum-up or momentum-down signals.
2. Donchian Channel:
o Show Donchian: Toggle visibility of the Donchian upper, lower, and middle bands.
o Band Colors: Choose the color for each band (upper, lower, middle).
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How to Use the Indicator:
1. Adjust Minimum Conditions: Set the minimum number of conditions that must be met for a signal to appear. For example, set it to 5 if you want only stronger signals.
2. Set Alert Threshold: Define the number of conditions needed to trigger an alert. This can be different from the minimum conditions for visual signals.
3. Customize Appearance: Modify the colors and styles of the signals to match your preferences.
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Conclusion:
This comprehensive trading indicator uses a combination of trend-following, pattern recognition, and momentum-based conditions to help you spot potential buy and sell opportunities. By adjusting the input settings, you can fine-tune it to match your specific trading strategy, making it a versatile tool for different market conditions.
Signal Reliability Based on Condition Count
The reliability of the buy/sell signals increases as more conditions are met. Here's a breakdown of the probabilities:
1. 1-3 Conditions Met: Lower Probability
o Signals that meet only 1-3 conditions tend to have lower reliability and are considered less probable. These signals may represent false positives or weaker market movements, and traders should approach them with caution.
2. 4 Conditions Met: More Reliable Signal
o When 4 conditions are met, the signal becomes more reliable. This indicates that multiple indicators or market patterns are aligning, increasing the likelihood of a valid buy/sell opportunity. While not foolproof, it's a stronger indication that the market may be moving in a particular direction.
3. 5-6 Conditions Met: Strong Signal
o A signal meeting 5-6 conditions is considered a strong signal. This indicates a well-confirmed move, with several technical indicators and market factors aligning to suggest a higher probability of success. These are the signals that traders often prioritize.
4. 7+ Conditions Met: Rare and High-Confidence Signal
o Signals that meet 7 or more conditions are rare and should be considered high-confidence signals. These represent a significant alignment of multiple factors, and while they are less frequent, they are highly reliable when they do occur. Traders can be more confident in acting on these signals, but they should still monitor market conditions for confirmation.
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You can adjust the number of conditions as needed, but this breakdown should give a clear structure on how the signal strength correlates with the number of conditions met!
SMT SwiftEdge PowerhouseSMT SwiftEdge Powerhouse: Precision Trading with Divergence, Liquidity Grabs, and OTE Zones
The SMT SwiftEdge Powerhouse is a powerful trading tool designed to help traders identify high-probability entry points during the most active market sessions—London and New York. By combining Smart Money Technique (SMT) Divergence, Liquidity Grabs, and Optimal Trade Entry (OTE) Zones, this script provides a unique and cohesive strategy for capturing market reversals with precision. Whether you're a scalper or a swing trader, this indicator offers clear visual signals to enhance your trading decisions on any timeframe.
What Does This Script Do?
This script integrates three key concepts to identify potential trading opportunities:
SMT Divergence:
SMT Divergence compares the price action of two correlated assets (e.g., Nasdaq and S&P 500 futures) to detect hidden market reversals. When one asset makes a higher high while the other makes a lower high (bearish divergence), or one makes a lower low while the other makes a higher low (bullish divergence), it signals a potential reversal. This technique leverages institutional "smart money" behavior to anticipate market shifts.
Liquidity Grabs:
Liquidity Grabs occur when price breaks above recent highs or below recent lows on higher timeframes (5m and 15m), often triggering stop-loss orders from retail traders. These breakouts are identified using pivot points and confirm institutional activity, setting the stage for a reversal. The script focuses on liquidity grabs during the London and New York sessions for maximum market activity.
Optimal Trade Entry (OTE) Zones:
OTE Zones are Fibonacci-based retracement areas (e.g., 61.8%) calculated after a liquidity grab. These zones highlight where price is likely to retrace before continuing in the direction of the reversal, offering a high-probability entry point. The script adjusts the width of these zones using the Average True Range (ATR) to adapt to market volatility.
By combining these components, the script identifies when institutional activity (liquidity grabs) aligns with market reversals (SMT divergence) and pinpoints precise entry points (OTE zones) during high-liquidity sessions.
Why Combine These Components?
The integration of SMT Divergence, Liquidity Grabs, and OTE Zones creates a robust trading system for several reasons:
Synergy of Institutional Signals: SMT Divergence and Liquidity Grabs both reflect "smart money" behavior—divergence shows hidden reversals, while liquidity grabs confirm institutional intent to trap retail traders. Together, they provide a strong foundation for identifying high-probability setups.
Session-Based Precision: Focusing on the London and New York sessions ensures signals occur during periods of high volatility and liquidity, increasing their reliability.
Precision Entries with OTE: After confirming a setup with divergence and liquidity grabs, OTE zones provide a clear entry area, reducing guesswork and improving trade accuracy.
Adaptability: The script works on any timeframe, with adjustable settings for signal sensitivity, session times, and Fibonacci levels, making it versatile for different trading styles.
This combination makes the script unique by aligning institutional insights with actionable entry points, tailored to the most active market hours.
How to Use the Script
Setup:
Add the script to your chart (works on any timeframe, e.g., 1m, 5m, 15m).
Configure the settings in the indicator's inputs:
Session Settings: Adjust the start/end times for London and New York sessions (default: London 8-11 UTC, New York 13-16 UTC). You can disable session restrictions if desired.
Asset Settings: Set the primary and secondary assets for SMT Divergence (default: NQ1! and ES1!). Ensure the assets are correlated.
Signal Settings: Adjust the lookback period, ATR period, and signal sensitivity (Low/Medium/High) to control the frequency of signals.
OTE Settings: Choose the Fibonacci level for OTE zones (default: 61.8%).
Visual Settings: Enable/disable OTE zones, SMT labels, and debug labels for troubleshooting.
Interpreting Signals:
Blue Circles: Indicate a liquidity grab (price breaking a 5m or 15m pivot high/low), marking the start of a potential setup.
Blue OTE Zones: Appear after a liquidity grab, showing the retracement area (e.g., 61.8% Fibonacci level) where price is likely to enter for a reversal trade. The label "OTE Trigger 5m/15m" confirms the direction (Short/Long) and session.
Green/Red Entry Boxes: Mark precise entry points when price enters the OTE zone and confirms the SMT Divergence. Green boxes indicate a long entry, red boxes a short entry.
Trading Example:
On a 1m chart, a blue circle appears when price breaks a 5m pivot high during the London session.
A blue OTE zone forms, showing a retracement area (e.g., 61.8% Fibonacci level) with the label "OTE Trigger 5m/15m (Short, London)".
Price retraces into the OTE zone, and a red "Short Entry" box appears, confirming a bearish SMT Divergence.
Enter a short trade at the red box, with a stop-loss above the OTE zone and a take-profit at the next support level.
Originality and Utility
The SMT SwiftEdge Powerhouse stands out by merging SMT Divergence, Liquidity Grabs, and OTE Zones into a single, session-focused indicator. Unlike traditional indicators that focus on one aspect of price action, this script combines institutional reversal signals with precise entry zones, tailored to the most active market hours. Its adaptability across timeframes, customizable settings, and clear visual cues make it a versatile tool for traders seeking to capitalize on smart money movements with confidence.
Tips for Best Results
Use on correlated assets like NQ1! (Nasdaq futures) and ES1! (S&P 500 futures) for accurate SMT Divergence.
Test on lower timeframes (1m, 5m) for scalping or higher timeframes (15m, 1H) for swing trading.
Adjust the "Signal Sensitivity" to "High" for more signals or "Low" for fewer, high-quality setups.
Enable "Show Debug Labels" if signals are not appearing as expected, to troubleshoot pivot points and liquidity grabs.
Dskyz (DAFE) Aurora Divergence - Dskyz (DAFE) Aurora Divergence Indicator
Advanced Divergence Detection for Traders. Unleash the power of divergence trading with this cutting-edge indicator that combines price and volume analysis to spot high-probability reversal signals.
🧠 What Is It?
The Dskyz (DAFE) Aurora Divergence Indicator is designed to identify bullish and bearish divergences between the price trend and the On Balance Volume (OBV) trend. Divergence occurs when the price of an asset and a technical indicator (in this case, OBV) move in opposite directions, signaling a potential reversal. This indicator uses linear regression slopes to calculate the trends of both price and OBV over a specified lookback period, detecting when these two metrics are diverging. When a divergence is detected, it highlights potential reversal points with visually striking aurora bands, orbs, and labels, making it easy for traders to spot key signals.
⚙️ Inputs & How to Use Them
The indicator is highly customizable, with inputs grouped under "⚡ DAFE Aurora Settings" for clarity. Here’s how each input works:
Lookback Period: Determines how many bars are used to calculate the price and OBV slopes. Higher values detect longer-term trends (e.g., 20 for 1H charts), while lower values are more responsive to short-term movements.
Price Slope Threshold: Sets the minimum slope value for the price to be considered in an uptrend or downtrend. A value of 0 allows all slopes to be considered, while higher values filter for stronger trends.
OBV Slope Threshold: Similar to the price slope threshold but for OBV. Helps filter out weak volume trends.
Aurora Band Width: Adjusts the width of the visual bands that highlight divergence areas. Wider bands make the indicator more visible but may clutter the chart.
Divergence Sensitivity: Scales the strength of the divergence signals. Higher values make the indicator more sensitive to smaller divergences.
Minimum Strength: Filters out weak signals by only showing divergences above this strength level. A default of 0.3 is recommended for beginners.
Signal Cooldown (Bars): Prevents multiple signals from appearing too close together. Default is 5 bars, reducing chart clutter and helping traders focus on significant signals.
These inputs allow traders to fine-tune the indicator to match their trading style and timeframe.
🚀 What Makes It Unique?
This indicator stands out with its innovative features:
Price-Volume Divergence: Combines price trend (slope) and OBV trend for more reliable signals than price-only divergences.
Aurora Bands: Dynamic visual bands that highlight divergence zones, making it easier to spot potential reversals at a glance.
Interactive Dashboard: Displays real-time information on trend direction, volume flow, signal type, strength, and recommended actions (e.g., "Consider Buying" or "Consider Selling").
Signal Cooldown: Ensures only the most significant divergences are shown, reducing noise and improving usability.
Alerts: Built-in alerts for both bullish and bearish divergences, allowing traders to stay informed even when not actively monitoring the chart.
Beginner Guide: Explains the indicator’s visuals (e.g., aqua orbs for bullish signals, fuchsia orbs for bearish signals), making it accessible for new users.
🎯 Why It Works
The indicator’s effectiveness lies in its use of price-volume divergence, a well-established concept in technical analysis. When the price trend and OBV trend diverge, it often signals a potential reversal because the underlying volume support (or lack thereof) is not aligning with the price action. For example:
Bullish Divergence: Occurs when the price is making lower lows, but the OBV is making higher lows, indicating weakening selling pressure and potential upward reversal.
Bearish Divergence: Occurs when the price is making higher highs, but the OBV is making lower highs, suggesting weakening buying pressure and potential downward reversal.
The use of linear regression ensures smooth and accurate trend calculations over the specified lookback period. The divergence strength is then normalized and filtered based on user-defined thresholds, ensuring only high-quality signals are displayed. Additionally, the cooldown period prevents signal overload, allowing traders to focus on the most significant opportunities.
🧬 Indicator Recommendation
Best For: Traders looking to identify potential trend reversals in any market, especially those where volume data is reliable (e.g., stocks, futures, forex).
Timeframes: Suitable for all timeframes. Adjust the lookback period accordingly—smaller values for shorter timeframes (e.g., 1H), larger for longer ones (e.g., 4H or daily).
Pair With: Support and resistance levels, trend lines, other oscillators (e.g., RSI, MACD) for confirmation, and volume profile tools for deeper analysis.
Tips:
Look for divergences at key support/resistance levels for higher-probability setups.
Pay attention to signal strength; higher strength divergences are often more reliable.
Use the dashboard to quickly assess market conditions before entering a trade.
Set up alerts to catch divergences even when not actively watching the chart.
🧾 Credit & Acknowledgement
This indicator builds upon the classic concept of price-volume divergence, enhancing it with modern visualization techniques, advanced filtering, and user-friendly features. It is designed to provide traders with a powerful yet intuitive tool for spotting reversals.
📌 Final Thoughts
The Dskyz (DAFE) Aurora Divergence Indicator is more than just a divergence tool; it’s a comprehensive trading assistant that combines advanced calculations, intuitive visualizations, and actionable insights. Whether you’re a seasoned trader or just starting out, this indicator can help you spot high-probability reversal points with confidence.
Use it with discipline. Use it with clarity. Trade smarter.
**I will continue to release incredible strategies and indicators until I turn this into a brand or until someone offers me a contract.
-Dskyz
